6 unchanged sentences
We operate in a highly competitive and fragmented industry, and our business may suffer if we are unable to adequately address any downward pricing pressures or other factors that may adversely affect our ability to compete with other carriers.
−Removed: Further, we are affected by recessionary economic cycles and downturns in customers’
−Removed: business cycles, particularly in market segments and industries, such as the automotive industry, where we have a significant concentration of customers.
+Added: Further, we are affected by recessionary economic cycles and downturns in customers’ business cycles, particularly in market segments and industries, such as the automotive industry, where we have a significant concentration of customers.
Economic conditions may also adversely affect our customers and their ability to pay for our services.
12 unchanged sentences
Purchase price increases for new revenue equipment, decreases in the value of used revenue equipment and/or disruptions in the availability of new revenue equipment could have an adverse effect on our results of operations, cash flows and financial condition.
−Removed: Over the past decade, the purchase price of new revenue equipment has increased significantly as equipment manufacturers recover increased materials and engine design costs resulting from compliance with increasingly stringent EPA engine emission standards, government tariffs on raw materials and other factors beyond the Company’s control.
+Added: Over the past decade, the purchase price of new revenue equipment has increased significantly as equipment manufacturers recover increased materials and engine design costs resulting from compliance with increasingly stringent EPA engine emission standards, government tariffs on raw materials and other factors beyond the Company’s control.
Additional EPA emission mandates, tariff increases on raw materials, or other factors that increase material or manufacturing costs of new equipment in the future could increase the purchase price paid by the Company for new revenue equipment and could result in higher than anticipated depreciation expenses.
−Removed: If we were unable to offset any such increase in expenses with freight rate increases, our cash flows and results of operations could be adversely affected.
+Added: If we are unable to offset any such increase in expenses with freight rate increases, our cash flows and results of operations could be adversely affected.
If the market price for used revenue equipment declines, we could incur substantial losses upon disposition of our revenue equipment which could adversely affect our results of operations and financial condition.
−Removed: Additionally, supply chain disruptions resulting from the COVID-19 pandemic and the related global shortage of microprocessors and other computer chips has caused significant production slowdowns at the North American Class 8 truck manufacturers and has substantially limited the availability of new revenue equipment available for delivery.
−Removed: Should such disruptions continue or worsen, it could significantly disrupt our equipment replacement cycle, further increase the prices for new revenue equipment and cause us to incur increased maintenance and operating expenses due to having to utilize existing equipment for longer time periods, and of which could have a material adverse effect on our business and profitability.
We have significant ongoing capital requirements that could affect our liquidity and profitability if we are unable to generate sufficient cash from operations or obtain sufficient financing on favorable terms.
3 unchanged sentences
Our operations are authorized and regulated by various federal and state agencies in the United States, Mexico and Canada that generally govern such activities as authorization to engage in motor carrier operations, safety, and financial reporting.
−Removed: Specific standards and regulations such as equipment dimensions, engine emissions, maintenance, drivers’
−Removed: hours of service, drug and alcohol testing, and hazardous materials are regulated by the Department of Transportation, Federal Motor Carrier Safety Administration, the Environmental Protection Agency and various other state and federal agencies.
+Added: Specific standards and regulations such as equipment dimensions, engine emissions, maintenance, drivers’ hours of service, drug and alcohol testing, and hazardous materials are regulated by the Department of Transportation, Federal Motor Carrier Safety Administration, the Environmental Protection Agency and various other state and federal agencies.
We may become subject to new or more restrictive regulations imposed by these authorities, which could significantly impair equipment and driver productivity and increase operating expenses.
The FMCSA administers carrier safety compliance and enforcement through its CSA program, which places carriers in peer groups and assigns each carrier a relative ranking compared to their peers in various categories.
−Removed: Carriers that exceed allowable thresholds in a particular category are placed in “intervention”
−Removed: status by the FMCSA until the score improves to a level below the threshold.
−Removed: If future roadside inspections or crashes were to result in the Company being placed in intervention status, we may incur additional operating costs to improve our safety program in deficient categories, experience increased roadside inspections, or have onsite visits by the FMCSA.
+Added: Carriers that exceed allowable thresholds in a particular category are placed in “intervention” status by the FMCSA until the score improves to a level below the threshold.
+Added: While the Company has not exceeded allowable thresholds to date, if future roadside inspections or crashes were to result in the Company being placed in intervention status, we may incur additional operating costs to improve our safety program in deficient categories, experience increased roadside inspections, or have onsite visits by the FMCSA.
If the intervention category is not remedied, it could affect our ability to attract and retain drivers and customers as they seek competitive carriers with scores below intervention thresholds.
8 unchanged sentences
Federal and state legislation as well as tax and other regulatory authorities often seek to assert that independent contractors in the transportation service industry are employees rather than independent contractors.
−Removed: An example of such legislation recently enacted in California is currently under a judicial stay with respect to trucking companies while a legal challenge to the law is pending.
−Removed: There can be no assurance that interpretations that support the independent contractor status will not change, that other federal or state legislation will not be enacted or that various authorities will not successfully assert a position that re-classifies independent contractors to be employees.
−Removed: If our independent contractors are determined to be our employees, that determination could materially increase our exposure under a variety of federal and state tax, workers’
−Removed: compensation, unemployment benefits, labor, employment and tort laws, as well as our potential liability for employee benefits.
−Removed: In addition, such changes may be applied retroactively, and if so, we may be required to pay additional amounts to compensate for prior periods.
+Added: Recently issued rulemaking by the U.S.
+Added: Department of Labor, which is effective March 11, 2024, and the laws of several states, including California, apply stricter tests for determining whether an independent contractor should be classified as an employee.
+Added: We believe we are in compliance with all applicable independent contractor classification requirements.
+Added: However, it is possible that other federal or state legislation or regulations could be enacted or that various authorities could assert a position that re-classifies independent contractors as employees.
+Added: If our independent contractors are determined to be properly classified as employees, that determination could materially increase our exposure under a variety of federal and state tax, workers’ compensation, unemployment benefits, labor, employment and tort laws, as well as our potential liability for employee benefits.
+Added: In addition, such changes may be applied retroactively, and if so, we may be required to pay additional amounts to compensate individuals for prior time periods.
Any of the above increased costs would adversely affect our business and operating results.
We may incur additional operating expenses or liabilities as a result of potential future requirements to address climate change issues.
−Removed: As global warming issues become more prevalent, federal, state and local governments, as well as some of our customers, have made efforts to respond to these issues.
+Added: As issues related to climate change become more prevalent, federal, state and local governments, as well as some of our customers, have made efforts to respond to these issues.
This increased focus on sustainability may result in new legislation or regulations and customer requirements that could negatively affect us as we may incur additional costs or be required to make changes to our operations in order to comply with any new regulations or customer requirements.
−Removed: Legislation or regulations that potentially impose restrictions, caps, taxes, or other controls on emissions of greenhouse gases such as carbon dioxide, a by-product of burning fossil fuels such as those used in the Company’s trucks, could adversely affect our operations and financial results.
+Added: Legislation or regulations that potentially impose restrictions, caps, taxes, or other controls on emissions of greenhouse gases such as carbon dioxide, a by-product of burning fossil fuels such as those used in the Company’s trucks, could adversely affect our operations and financial results.
More specifically, legislative or regulatory actions relating to climate change could adversely impact the Company by increasing our fuel costs and reducing fuel efficiency and could result in the creation of substantial additional capital expenditures and operating costs in the form of taxes, emissions allowances, or required equipment upgrades.
3 unchanged sentences
Risks Related to Our Business
−Removed: The ongoing impact of the COVID-19 pandemic, or other similar outbreaks in the future, could negatively impact our financial condition, liquidity, results of operations, and cash flows.
−Removed: The rapid spread of COVID-19 resulted in governmental authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter in place orders, increased border and port controls and closures, and shutdowns.
−Removed: These measures and the public health concerns resulting from the outbreak severely disrupted economic and commercial activity.
−Removed: The resulting impact on domestic and global supply chains caused slowdowns and reduced freight demand for transportation companies such as ours.
−Removed: Because we have a significant concentration of customers within the automotive industry, our freight volumes and revenues were significantly affected by the closure of North American automotive manufacturing facilities beginning in late March of 2020.
−Removed: Our automotive customers resumed operations during the second quarter of 2020 and have not been materially disrupted during 2021 or 2022.
−Removed: Any future delays or interruptions of automotive production and other consumer activity affecting our customers that could result from any future wave of the virus or other similar outbreaks could further adversely affect our business.
−Removed: In addition, the implementation of measures to protect the health and safety of our employees, customers, vendors and the general public, or any state of federal vaccination mandates, may disrupt our ability to efficiently manage personnel and operations and to recruit and retain driver and non-driver personnel, which could have a material adverse effect on our operating results. Further, negative financial results, an economic downturn or uncertainty, or a tightening of credit markets caused by COVID-19 or other similar outbreaks could have a material adverse effect on our liquidity and our ability to effectively meet our short- and long-term financial obligations.
Numerous competitive factors could impair our ability to operate at an acceptable profit.
2 unchanged sentences
some of our competitors periodically reduce their freight rates to gain business, especially during times of reduced growth rates in the economy, which may limit our ability to maintain or increase freight rates, maintain our margins or maintain significant growth in our business;
−Removed: many customers reduce the number of carriers they use by selecting so-called “core carriers”
−Removed: as approved service providers, and in some instances we may not be selected;
+Added: many customers reduce the number of carriers they use by selecting so-called “core carriers” as approved service providers, and in some instances we may not be selected;
many customers periodically accept bids from multiple carriers for their shipping needs, and this process may depress freight rates or result in the loss of some of our business to competitors;
11 unchanged sentences
Generally, we do not have long-term contractual relationships with our major customers, and we cannot assure that our customer relationships will continue as presently in effect.
−Removed: Our business and profitability was materially and adversely affected by the closure of North American automotive manufacturing facilities during the spring of 2020 due to the COVID-19 outbreak and is currently being adversely impacted by similar production slowdowns and closures within the automotive manufacturing industry due to shortages of microprocessors and other computer chips essential for new vehicle production.
Any sustained or future reduction in or termination of our services by our major customers could have a further material adverse effect on our business and operating results.
−Removed: A significant labor dispute involving one or more of our customers could reduce our revenues and harm our profitability.
+Added: Ongoing effects from recent labor disputes involving several of our customers or the impact of any future significant labor dispute involving one or more of our customers, or that could otherwise affect our operations, could reduce our revenues and harm our profitability.
A substantial number of the employees of our largest customers are members of industrial trade unions and are employed under the terms of collective bargaining agreements.
−Removed: Future labor disputes involving our customers could affect our operations.
−Removed: If the unions and our automotive customers and their suppliers are unable to negotiate new contracts in the future and our customers’
−Removed: plants experience slowdowns or closures as a result, our revenue and profitability could be negatively impacted.
−Removed: A labor dispute involving another supplier to our customers that results in a slowdown or closure of our customers’
−Removed: plants to which we provide services could also have a material adverse effect on our business.
+Added: In September 2023, the United Auto Workers initiated a trilateral strike against Ford, General Motors, and Stellantis that lasted several weeks until each of these automotive customers was able to negotiate a new contract with the union.
+Added: The strike targeted select plants at each of these automotive companies, causing prolonged plant shutdowns for these customers and ripple effects on plants and workers for other customers and automotive suppliers.
+Added: The effects of these shutdowns adversely impacted our business and financial performance during the third and fourth quarters of 2023 and have continued into the first quarter of 2024.
+Added: While operations at the affected customer and supplier plants have resumed, some of these customer facilities have yet to return to fully operational status, and we continue to experience reduced freight volumes as a result of the recent labor disruptions.
+Added: Any sustained slowdown in operations for these customers and any future labor disputes involving our customers could further affect our operations.
+Added: If our automotive customers and their suppliers are unable to return to full operations in the near future or if these customers are unable to negotiate new contracts in the future and our customers’ plants experience slowdowns or closures as a result, our revenue and profitability could be negatively impacted.
+Added: A labor dispute involving another supplier to our customers that results in a slowdown or closure of our customers’ plants to which we provide services could also have a material adverse effect on our business.
Ongoing insurance and claims expenses could significantly reduce our earnings.
Our future insurance and claims expenses might exceed historical levels, which could reduce our earnings.
−Removed: The Company is self-insured for a material portion of auto liability claims in excess of two million dollars and for health and workers’
−Removed: compensation insurance up to certain limits.
+Added: The Company is self-insured for a material portion of auto liability claims in excess of two million dollars and for health and workers’ compensation insurance up to certain limits.
The actual cost to settle self-insured claims can differ from amounts reserved due to various uncertainties, including the ultimate severity of the claims and potential amounts required to defend and settle claims.
36 unchanged sentences
Under this new decree, operating companies are no longer able to source their labor resources used to carry out core business functions from service entities or third-party providers and could be subject to the loss of tax deductions and value-added tax credits on payments to outsourced personnel and certain penalties for failing to comply with the new requirements.
−Removed: The passage of this decree did not have a material adverse impact on our business and financial results.
+Added: The passage of this decree has not had a material adverse impact on our business and financial results to date.
Our results of operations may be affected by seasonal factors.
13 unchanged sentences
We operate in industrial areas, where truck terminals and other industrial activities are located, and where groundwater or other forms of environmental contamination could occur.
−Removed: We also maintain bulk fuel storage and fuel islands at one of our facilities.
Our operations may involve the risks of fuel spillage or seepage, environmental damage, and hazardous waste disposal, among others.
30 unchanged sentences
In addition, the insurance premiums charged for some or all of the coverage currently maintained by us could increase dramatically or such coverage could be unavailable in the future.
+Added: Future public health crises could negatively impact our financial condition, liquidity, results of operations, and cash flows.
+Added: The rapid spread of the COVID-19 pandemic during 2020 resulted in governmental authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter in place orders, increased border and port controls and closures, and shutdowns.
+Added: These measures and the public health concerns resulting from the outbreak severely disrupted economic and commercial activity.
+Added: The resulting impact on domestic and global supply chains caused slowdowns and reduced freight demand for transportation companies such as ours.
+Added: Because we have a significant concentration of customers within the automotive industry, our freight volumes and revenues were significantly affected by the temporary closure of North American automotive manufacturing facilities during the spring of 2020 as a result of the pandemic.
+Added: Any future delays or interruptions of automotive production and other consumer activity affecting our customers that could result from any future public health crises could further adversely affect our business.
+Added: In addition, the implementation of measures to protect the health and safety of our employees, customers, vendors and the general public, or any state of federal vaccination mandates, may disrupt our ability to efficiently manage personnel and operations and to recruit and retain driver and non-driver personnel, which could have a material adverse effect on our operating results.
+Added: Further, negative financial results, an economic downturn or uncertainty, or a tightening of credit markets caused by a public health crisis could have a material adverse effect on our liquidity and our ability to effectively meet our short- and long-term financial obligations.
Risks Related to Our Common Stock
−Removed: The Chairman of our board of directors holds a controlling interest in the Company;
−Removed: therefore, the influence of our public shareholders over significant corporate actions is limited, and we are not subject to certain corporate governance standards that apply to other publicly traded companies.
−Removed: Moroun, the Chairman of our Board of Directors, and a trust of which Mr.
−Removed: Moroun is a co-trustee together own approximately 70% of our outstanding common stock.
−Removed: As a result, Mr.
−Removed: Moroun has the power to:
−Removed: control all matters submitted to our shareholders;
−Removed: elect our directors;
−Removed: adopt, extend or remove any anti-takeover provisions that are available to us;
−Removed: exercise control over our business, policies and affairs.
−Removed: This concentration of ownership could limit the price that some investors might be willing to pay for shares of our common stock, and our ability to engage in significant transactions, such as a merger, acquisition or liquidation, will require the consent of Mr.
−Removed: Conflicts of interest could arise between us and Mr.
−Removed: Moroun, and any conflict of interest may be resolved in a manner that does not favor us.
−Removed: Accordingly, Mr.
−Removed: Moroun could cause us to enter into transactions or agreements of which our other shareholders would not approve or make decisions with which they may disagree.
−Removed: Because of Mr.
−Removed: Moroun’s level of ownership, we have elected to be treated as a controlled company in accordance with the rules of the NASDAQ Stock Market.
−Removed: Accordingly, we are not required to comply with NASDAQ Stock Market rules which would otherwise require a majority of our Board to be comprised of independent directors and require our Board to have a compensation committee and a nominating and corporate governance committee comprised of independent directors.
−Removed: Moroun may continue to retain control of the Company for the foreseeable future and may decide not to enter into a transaction in which shareholders would receive consideration for our common stock that is much higher than the then-current market price of our common stock.
−Removed: In addition, Mr.
−Removed: Moroun could elect to sell a controlling interest in us to a third-party and our other shareholders may not be able to participate in such transaction or, if they are able to participate in such a transaction, such shareholders may receive less than the then-current fair market value of their shares.
−Removed: Any decision regarding ownership of us that Mr.
−Removed: Moroun may make at some future time will be in his absolute discretion, subject to applicable laws and fiduciary duties.
+Added: Our public shareholders may have limited influence over our significant corporate actions.
+Added: Moroun, the Chairman of our Board of Directors, is the trustee of family trusts that collectively own greater than 50% of our outstanding common stock.
+Added: In this capacity, Mr.
+Added: Moroun holds investment power over the shares of our common stock held by the family trusts.
+Added: Calderone, a member of our Board of Directors, is the special trustee of certain of these family trusts, and in that capacity, he exercises voting power over the shares held by such trusts, while Mr.
+Added: Moroun exercises voting power over the shares held by the other family trust of which he is trustee.
+Added: The special trustee serves at the discretion of the trustee of the trusts, and members of the Moroun family are the beneficiaries of the family trusts.
+Added: Moroun and Calderone have entered into a voting agreement under which Mr.
+Added: Moroun agreed to vote the shares of our common stock over which he exercises voting power in accordance with and in the same manner as Mr.
+Added: Calderone votes the shares of our common stock held by the family trusts over which the special trustee exercises voting power.
+Added: Therefore, votes cast on behalf of the family trusts control any action requiring the general approval of our shareholders, including the election of our board of directors, the adoption of amendments to our certificate of incorporation and bylaws, and the approval of any merger or sale of substantially all of our assets.
+Added: This concentration of ownership could also limit the price that some investors might be willing to pay for shares of our common stock.
+Added: The interests of our controlling shareholders may conflict with those of the Company and our other shareholders.
+Added: The interests of the Moroun family trusts could conflict with the interests of the Company or our other shareholders.
+Added: For example, the concentration of ownership in the trusts could delay, defer, or prevent a change of control of the Company that may otherwise be favorable to the Company and our other shareholders.
+Added: The votes cast on behalf of the family trusts could also result in our entry into transactions or agreements that our other shareholders do not approve.
+Added: Our controlling shareholders might also refrain from voting in favor of a transaction that would result in our other shareholders receiving consideration for our common stock that is much higher than its then-current market price.
+Added: Any such decisions that may be made in the future by our controlling shareholders will be in their absolute discretion, subject to applicable laws and fiduciary duties.
+Added: Because we are a “ controlled company ” under NASDAQ rules, we are not subject to certain corporate governance standards that apply to other publicly traded companies.
+Added: The NASDAQ rules state that a controlled company is one in which more than 50% of the voting power is held by another person or group of persons acting together.
+Added: A controlled company may elect not to comply with certain corporate governance requirements, including:
+Added: a majority of the board of directors consist of independent directors;
+Added: a nominating and corporate governance committee composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;
+Added: the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
+Added: We are a controlled company under these rules, and these requirements will not apply to us as long as we retain that status.
+Added: Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of NASDAQ.
Our stock trading volume may not provide adequate liquidity for investors.
3 unchanged sentences
Given the daily average trading volume of our common stock, significant sales of the common stock in a brief period of time, or the expectation of these sales, could cause a decline in the price of our common stock.
−Removed: Additionally, low trading volumes may limit a stockholder’s ability to sell shares of our common stock.
+Added: Additionally, low trading volumes may limit a stockholder’s ability to sell shares of our common stock.
We currently do not intend to pay future dividends on our common stock.
2 unchanged sentences
Therefore, stockholders should not rely on future dividend income from shares of our common stock.
−Removed: Unresolved Staff Comments.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.