What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2026-03-12 compared with 2025-03-12 · 71 added, 60 removed, 205 unchanged (39% of the section changed)

22 unchanged sentences

The Company's administrative headquarters are in Tontitown, Arkansas.

From this location we manage operations conducted through our wholly-owned subsidiaries based in various locations around the United States, Mexico, and Canada.

From this location we manage operations in the continental United States, Mexico, and Canada conducted through our wholly-owned subsidiaries.

The operations of these subsidiaries can generally be classified into either truckload services or brokerage and logistics services.

28 unchanged sentences

Insurance and claims

Loss(gain) on sale or disposal of property

Gain(loss) on sale or disposal of property

Total operating expenses

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For the year ended December 31, 2025, truckload services revenue, before fuel surcharges, decreased 14.8% to $359.6 million as compared to $422.0 million for the year ended December 31, 2024.

The decrease relates primarily to an 8.3% decrease in total miles travelled from 178.6 million during the year ended December 31, 2024 to 163.8 million for the year ended December 31, 2025 and to a 3.8% decrease in our rate per mile, from $2.10 for the year ended December 31, 2024 to $2.02 for the year ended December 31, 2025.

The reduction in total miles was primarily driven by a 10.4% reduction in the average number of trucks operated offset by a 2.7% improvement in average miles driven by each truck during the year ended December 31, 2025 compared to the year ended December 31, 2024.

The reduction in truck count and miles resulted from a less favorable freight market year over year, characterized by an oversupply of available trucks in the market compared to available freight.

Salaries, wages and benefits increased from 38.9% of revenues, before fuel surcharges, during 2024 to 42.0% of revenues, before fuel surcharges, during 2025.

The percentage-based increase relates primarily to the interaction of a decrease in operating revenues with the fixed-cost nature of employing human capital.

Rent and purchased transportation increased from 26.1% of revenues, before fuel surcharges, during 2024 to 27.4% of revenues, before fuel surcharges, during 2025.

The increase was primarily due to an increase in the percentage of miles driven by third-party owner-operators as opposed to company-employed drivers for the year ended December 31, 2025 compared to the year ended December 31, 2024.

Depreciation expense decreased from 23.3% of revenues, before fuel surcharges, for the year ended December 31, 2024 to 22.6% of revenues, before fuel surcharges, for the year ended December 31, 2025.

The decrease is primarily attributable to the absence of the incremental depreciation recognized in 2024 resulting from the Company’s change in accounting estimates related to the useful lives and salvage values of revenue equipment.

As previously disclosed, during the year ended December 31, 2024, the Company reduced the estimated useful lives of its trailer equipment and lowered the estimated salvage values of revenue equipment, which increased depreciation expense in that period.

Depreciation expense in 2025 reflects the continued application of those revised estimates but does not include a comparable incremental impact from an additional change in estimate.

Although depreciation decreased as a percentage of revenue year over year, it remains elevated relative to 2023 due to the ongoing effect of the shorter estimated useful lives and lower salvage values established in 2024, as well as the continued replacement of revenue equipment at costs that remain above historical levels.

In addition, the fixed-cost nature of depreciation expense, combined with lower operating revenues in 2025, affects period-over-period comparability of depreciation as a percentage of revenue.

Impairment loss accounted for 0% of revenues, before fuel surcharges, during 2025, compared to 1.5% of revenues, before fuel surcharges, during 2024.

Although management continues to believe that market conditions for used revenue equipment have deteriorated since their peak in 2022, the Company performed a recoverability analysis of its long-lived asset groups during the year ended December 31, 2025 and concluded that the carrying amounts of all applicable asset groups were recoverable, as the estimated future undiscounted cash flows for each asset group exceeded its respective carrying value.

Accordingly, no impairment loss was recognized during 2025.

In contrast, during the year ended December 31, 2024, management determined that certain asset groups of trucks and trailers were impaired, resulting in an impairment loss of approximately $6.4 million, or $0.22 loss per share, net of tax.

Insurance and claims increased from 4.6% of revenues, before fuel surcharges, during 2024 to 12.9% of revenues, before fuel surcharges, during 2025.

The increase is attributable to an increase in the Company’s auto-liability reserve during the fourth quarter of 2025.

This increase in auto-liability reserve is due to an agreement in principle to settle a significant auto-liability claim in which the Company was a named defendant.

The total settlement amount is $30.0 million, of which $26.5 million represents the Company’s net exposure after consideration of applicable insurance coverage.

Gains (losses) on disposition of equipment increased from a loss of 0.2% of revenues, before fuel surcharges, for the year ended December 31, 2024 to a gain of 4.3% of revenues, before fuel surcharges, for the year ended December 31, 2025.

The Company recognized a net loss on disposition of equipment of approximately $0.8 million during 2024, compared to net gains of approximately $15.5 million during 2025.

The increase was primarily attributable to higher disposition volumes in 2025, including the sale of approximately 650 additional trailers and 250 additional trucks compared to 2024, as well as the sale of certain equipment whose carrying values had been reduced in 2024 as a result of impairment charges.

The increased volume of disposals was driven in part by the reduction in estimated useful lives of trailers implemented in 2024, which accelerated the planned retirement and disposal of certain assets that were not previously expected to be sold in 2025.

Non-operating income increased from 1.9% of revenues, before fuel surcharges, during 2024 to 2.8% of revenues, before fuel surcharges, during 2025.

This increase resulted primarily from an increase in the market value of our marketable equity securities portfolio and an increase in the Company’s net realized gains from the sale of certain marketable equity securities during the year-ended December 31, 2025 as compared to the year ended December 31, 2024.

Interest expense increased from 2.9% of revenues, before fuel surcharges, for the year ended December 31, 2024 to 4.7% of revenues, before fuel surcharges, for the year ended December 31, 2025.

The increase was primarily attributable to a net increase in long-term debt of approximately $8.3 million, consisting of $91.9 million of equipment financing obtained during 2025, partially offset by $83.6 million of long-term debt repayments.

The weighted-average interest rate on debt incurred during 2025 was 5.71%, compared to 5.17% for debt incurred prior to 2025 that remained outstanding as of December 31, 2025, meaning the Company experienced a higher overall cost of new borrowings.

The repayment of lower-rate debt and issuance of new debt at higher prevailing interest rates further contributed to the increase in interest expense.

The fixed-cost nature of interest expense, combined with lower operating revenues in 2025, also increased interest expense as a percentage of revenue.

The truckload services division operating ratio, which measures the ratio of operating expenses, net of fuel surcharges, to operating revenues, before fuel surcharges, increased to 118.4% for 2025 from 111.2% for 2024.

2024 Compared to 2023

For the year ended December 31, 2024, truckload services revenue, before fuel surcharges, decreased 8.4% to $422.0 million as compared to $460.9 million for the year ended December 31, 2023.

The decrease relates primarily to a 5.7% decrease in total miles travelled from 189.5 million during the year ended December 31, 2023 to 178.6 million for the year ended December 31, 2024 and to a 3.2% decrease in our rate per mile, from $2.17 for the year ended December 31, 2023 to $2.10 for the year ended December 31, 2024.

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2023 Compared to 2022

For the year ended December 31, 2023, truckload services revenue, before fuel surcharges, decreased 14.8% to $460.9 million as compared to $540.9 million for the year ended December 31, 2022.

The decrease relates primarily to a 14.2% decrease in our rate per loaded mile, from $2.92 for the year ended December 31, 2022 to $2.51 for the year ended December 31, 2023 and to a 0.8% decrease in loaded miles from 185.0 million for the year ended December 31, 2022 to 183.8 million for the year ended December 31, 2023.

The decrease in rate per loaded mile reflects the challenging freight rate environment across our industry during 2023, while the slight reduction in loaded miles was largely due to the impacts of the automotive plant shutdowns during the UAW strikes in September and October 2023, partially offset by an increase in our average truck count during 2023 attributable to the acquisition of Metropolitan Trucking assets in June 2022.

Salaries, wages and benefits increased from 31.3% of revenues, before fuel surcharges, during 2022 to 37.8% of revenues, before fuel surcharges, during 2023.

The percentage-based increase relates primarily to an increase in the percentage of miles driven by company-employed drivers, as opposed to third-party owner-operators for the year-ended December 31, 2023 compared to December 31, 2022.

The increase also relates to the interaction of a decrease in operating revenues with the fixed-cost nature of employing human capital.

Operating supplies and expenses increased from 6.8% of revenues, before fuel surcharges, during 2022 to 11.8% of revenues, before fuel surcharges, during 2023.

The increase relates primarily to the interaction of expenses with fixed-cost characteristics, such as rents, driver training schools and operating taxes and licenses with a decrease in revenue.

The increase also relates to an increase in the average surcharge-adjusted fuel price paid per gallon of diesel fuel, due to decreased fuel surcharge collections from customers for the year ended December 31, 2023 compared to December 31, 2022.

Rent and purchased transportation decreased from 26.0% of revenues, before fuel surcharges, during 2022 to 23.5% of revenues, before fuel surcharges, during 2023.

The decrease was primarily due to a decrease in the percentage of miles driven by third-party owner-operators as opposed to company-employed drivers for the year-ended December 31, 2023 compared to December 31, 2022.

The decrease also relates to a decrease in the rates paid to third-party owner-operators for the year ended December 31, 2023 compared to the year ended December 31, 2022.

Depreciation increased from 11.3% of revenues, before fuel surcharges, during 2022 to 13.8% of revenues, before fuel surcharges, during 2023.

The increase relates primarily to an increase in cost for replacement revenue equipment compared to the cost of retired equipment and to the interaction of a decrease in operating revenues with the fixed-cost nature of depreciation expense.

Insurance and claims increased from 6.0% of revenues, before fuel surcharges, during 2022 to 6.7% of revenues, before fuel surcharges, during 2023.

This increase relates primarily to an increase in the rate per mile paid for auto liability insurance combined with a decrease in our revenue rate per mile.

Non-operating income increased from 0.5% of revenues, before fuel surcharges, during 2022 to 1.2% of revenues, before fuel surcharges, during 2023.

This increase resulted primarily from an increase in interest income recognized, as well as a larger increase in the market value of our marketable equity securities portfolio at December 31, 2023 as compared to December 31, 2022.

Results of Operations - Logistics and Brokerage Services

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For the year ended December 31, 2025, logistics and brokerage services revenues, before fuel surcharges, decreased 19.3% to $167.0 million as compared to $207.0 million for the year ended December 31, 2024.

The decrease relates to a reduction in the average rates charged to customers year to year, while total brokered loads remained flat.

The truckload market continues to be negatively impacted by downward rate pressure driven by the challenging truckload rate environment.

The decrease relates to a reduction in the average rates charged to customers year to year, coupled with a 25.4% decrease in brokered loads year over year.

The brokerage market continued to be negatively impacted by downward rate pressure driven by the challenging truckload rate environment.

Rent and purchased transportation increased from 86.6% of revenues, before fuel surcharges, in 2024 to 89.3% of revenues, before fuel surcharges, in 2025.

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For the year ended December 31, 2024, logistics and brokerage services revenues, before fuel surcharges, decreased 15.6% to $207.0 million as compared to $245.2 million for the year ended December 31, 2023.

The decrease was primarily related to a 21.4% decrease in revenue per load, partially offset by a 12.3% increase in the number of loads during 2023 as compared to 2022.

The decrease in revenue per load was due to a reduction in rates paid for brokered loads during 2023, as spot market rates were negatively impacted by downward rate pressure driven by the challenging truckload freight rate environment across our industry during 2023.

The decrease relates to a reduction in the average rates charged to customers year to year, while total brokered loads remained flat, as the brokerage market was negatively impacted by downward rate pressure driven by the challenging truckload rate environment.

Rent and purchased transportation increased from 84.6% of revenues, before fuel surcharges, in 2023 to 86.6% of revenues, before fuel surcharges, in 2024.

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2025 Compared to 2024

Income tax benefit was approximately $9.8 million in 2024, resulting in an effective rate of 23.5%, as compared to income tax expense of approximately $10.2 million, or an effective tax rate of 35.6% in 2023.

Income tax benefit was approximately $17.7 million in 2025, resulting in an effective rate of 25.2%, as compared to income tax benefit of approximately $9.8 million, or an effective tax rate of 23.5% in 2024.

The effective tax rate is impacted by the effect of state taxes and other factors.

In determining whether a tax asset valuation allowance is necessary, management, in accordance with the provisions of Accounting Standards Codification (“ASC”) 740-10-30, weighs all available evidence, both positive and negative to determine whether, based on the weight of that evidence, a valuation allowance is necessary.

If negative conditions exist which indicate a valuation allowance might be necessary, consideration is then given to what effect the future reversals of existing taxable temporary differences and the availability of tax strategies might have on future taxable income to determine the amount, if any, of the required valuation allowance.

As of December 31, 2024, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by taxing authorities, based on the technical merits of the position.

As of December 31, 2024, an adjustment to the Company’s consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

As of December 31, 2025, management conducted a tax asset valuation allowance as described above and determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

Additionally, s of December 31, 2025, an adjustment to the Company’s consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense.

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The major tax jurisdictions in which we operate generally provide for a deficiency assessment statute of limitation period of three years and as a result, the Company’s tax years 2022 and forward remain open to examination in those jurisdictions.

The combined net loss for all divisions was $31.8 million, or 5.1% of revenues, before fuel surcharge, for 2024 as compared to the combined net income for all divisions of $18.4 million or 2.6% of revenues, before fuel surcharge, for 2023.

Diluted (loss) earnings per share decreased to ($1.45) for the year ended December 31, 2024 from $0.83 for the year ended December 31, 2023.

The combined net loss for all divisions was $52.6 million, or 10.0% of revenues, before fuel surcharge, for 2025 as compared to the combined net loss for all divisions of $31.8 million, or 5.1% of revenues, before fuel surcharge, for 2024.

Diluted loss per share decreased to ($2.48) for the year ended December 31, 2025 from ($1.45) for the year ended December 31, 2024.

2024 Compared to 2023

Income tax expense was approximately $10.2 million in 2023, resulting in an effective rate of 35.6%, as compared to approximately $28.3 million, or an effective tax rate of 23.8% in 2022.

The effective tax rate is impacted by the effect of state taxes and other factors.

In determining whether a tax asset valuation allowance is necessary, management, in accordance with the provisions of ASC 740-10-30, weighs all available evidence, both positive and negative to determine whether, based on the weight of that evidence, a valuation allowance is necessary.

As of December 31, 2023, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

As of December 31, 2023, an adjustment to the Company’s consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

As of December 31, 2024, management conducted a tax asset valuation allowance as described above and determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary.

Additionally, as of December 31, 2024, management determined that an adjustment to the Company’s consolidated financial statements for uncertain tax positions was not required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws.

The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense.

During 2023 and 2022, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions.

The combined net income for all divisions was $18.4 million, or 2.6% of revenues, before fuel surcharge, for 2023 as compared to the combined net income for all divisions of $90.7 million or 11.1% of revenues, before fuel surcharge, for 2022.

Diluted earnings per share decreased to $0.83 for the year ended December 31, 2023 from $4.04 for the year ended December 31, 2022.

During 2023, the Company did not recognize or accrue any interest or penalties related to uncertain income tax positions.

Diluted (loss) earnings per share decreased to ($1.45) for the year ended December 31, 2024 from $0.83 for the year ended December 31, 2023.

Liquidity and Capital Resources

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During 2025, we generated $17.3 million in cash from operating activities compared to $59.0 million and $114.6 million in 2024 and 2023, respectively.

Investing activities used $100.2 million in cash during 2024 compared to using $11.3 million and $113.5 million in 2023 and 2022, respectively.

Financing activities generated $8.6 million in cash during 2024 compared to using $76.8 million during 2023 and generating $0.3 million during 2022.

Investing activities generated $18.4 million in cash during 2025 compared to using $100.2 million and $11.3 million in 2024 and 2023, respectively.

Financing activities used $68.6 million in cash during 2025 compared to generating $8.6 million during 2024 and using $76.8 million during 2023.

See the Consolidated Statements of Cash Flows in Item 8 of this Report.

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We typically use installment notes, our existing lines of credit on an interim basis, proceeds from the sale or trade of equipment, and cash flows from operations to finance capital expenditures and repay long-term debt.

During 2024 and 2023, we utilized cash on hand, installment notes, and our lines of credit to finance revenue equipment purchases of approximately $143.5 million and $113.5 million, respectively.

During 2025 and 2024, we utilized cash on hand, long-term debt, and our lines of credit to finance purchases of revenue equipment and other assets of approximately $40.7 million and $195.7 million, respectively.

In addition, we acquired approximately $61.9 million and $50.0 million of revenue equipment through vendor-direct financing arrangements during 2025 and 2024, respectively.

These non-cash financing arrangements provide an additional source of liquidity for acquiring new equipment but do not result in cash inflows or outflows and, accordingly, are not reflected in the consolidated statement of cash flows.

We often finance the acquisition of revenue equipment through installment notes with fixed interest rates.

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At December 31, 2025, we had no outstanding borrowings against the line of credit and approximately $0.3 million of outstanding letters of credit, with availability to borrow $59.7 million.

Trade accounts receivable remained relatively flat year-over-year, with a balance of $80.0 million at December 31, 2024 compared to $80.6 million at December 31, 2023.

Marketable equity securities at December 31, 2024 decreased approximately $0.6 million as compared to December 31, 2023.

The decrease resulted from the sales of marketable equity securities approximating $3.7 million offset by an increase in the market value of the portfolio by approximately $3.1 million.

Trade accounts receivable decreased by approximately $13.1 million from $80.0 million as of December 31, 2024 to $66.9 million as of December 31, 2025.

The decrease is attributed to a general decrease in freight revenue and fuel surcharge revenue, which flows through the accounts receivable account, during the fourth quarter of 2025 as compared to the freight revenue and fuel surcharge revenue generated during the fourth quarter of 2024.

Marketable equity securities at December 31, 2025 increased approximately $5.9 million as compared to December 31, 2024.

The increase resulted from the unrealized appreciation in the fair value of the portfolio by $4.8 million coupled with the purchase of $4.2 million in marketable equity securities, partially offset by the sales of marketable equity securities approximating $3.1 million.

At December 31, 2025, the remaining marketable equity securities have a combined cost basis of approximately $28.2 million and a combined fair market value of approximately $48.5 million.

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The holding term of these securities depends largely on the general economic environment, the equity markets, borrowing rates, and the Company's cash requirements.

Property and equipment increased by approximately $65.4 million from $771.1 as of December 31, 2023 to $836.5 million as of December 31,2024.

This increase is primarily attributable to the purchase of $144.2 million of revenue equipment partially offset by the disposal of approximately $93.8 million of revenue equipment during 2024.

Also contributing to the increase was the purchase of property in El Paso, Texas that will serve as an additional terminal for our truckload operations and the construction of a driver training facility at our corporate headquarters in Tontitown, Arkansas.

Partially offsetting the increase to property and equipment was an impairment loss of $6.4 million which resulted from management’s assessment that the market conditions for used revenue equipment had deteriorated to an extent that required a test for recoverability and subsequent impairment charge against certain asset groups of used trucks and trailers.

Accounts payable decreased from $62.7 million at December 31, 2023 to $31.2 million at December 31, 2024.

This decrease was primarily attributable to payments made during 2024 for new revenue equipment that was invoiced or delivered, but not yet paid as of December 31, 2023.

This decrease was also attributable to a decrease in the amounts payable to third party carriers as of December 31, 2024.

Accounts payable accruals can vary significantly at the end of each reporting period depending on the timing of the actual date of payment in relation to the last day of the reporting period.

Accrued expenses and other liabilities decreased from $16.8 million at December 31, 2023 to $14.6 million at December 31, 2024.

The decrease is primarily attributable to a decrease in auto liability claims accrued during the year ended December 31, 2024 compared to auto liability claims accrued for the year ended December 31, 2023.

Property and equipment decreased by approximately $44.1 million from $836.5 as of December 31, 2024 to $792.4 million as of December 31,2025.

This decrease is primarily attributable to the disposal of aging trucks and trailers totaling $160.2 million during 2025.

This was partially offset by the purchase of new trucks and trailers approximating $108.2 million and the remodel of our corporate headquarters and a driver training facility at our corporate headquarters in Tontitown, Arkansas during 2025.

Accounts payable remained relatively flat year over year with a balance of $32.8 million at December 31, 2025 compared to a balance of $31.2 million at December 31, 2024.

Accrued expenses and other liabilities increased from $14.6 million at December 31, 2024 to $41.1 million at December 31, 2025.

The increase is primarily attributable to an increase in the Company’s auto-liability reserve during the fourth quarter of 2025.

This increase in auto-liability reserve is due to an agreement in principle to settle a significant auto-liability claim in which the Company was a named defendant totaling $26.5 million after consideration of applicable insurance coverage.

For 2026, we expect to purchase 570 new trucks and 700 trailers while continuing to sell or trade equipment that has reached the end of its life cycle.

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Over the past three years, the effect of inflation has been significant.

If the current rate of inflation persists, inflation, coupled with supply chain issues and international events could continue to result in increased costs for drivers, employee wages, equipment, fuel and other costs.

If the current rate of inflation persists, inflation, coupled with supply chain issues and international events, such factors could continue to result in increased costs for drivers, employee wages, equipment, fuel and other costs.

Adoption of Accounting Policies

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The effect of this change increased depreciation expense by $24.7 million and increased basic and diluted loss per share by $0.86 net of tax, for the year ended December 31, 2024.

The impact of this change on depreciation expense and earnings per share for the year ended December 31, 2025 was not material.

Impairment of Long-Lived Assets.

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The determination of fair value involves significant management judgment, including assumptions about future revenue growth, operating costs, asset utilization, and discount rates.

During the year ended December 31, 2025, management evaluated its long-lived assets for impairment and performed recoverability testing where indicators were present.

Based on these analyses, management concluded that all asset groups were recoverable and no impairment charges were recorded in 2025.

During the year ended December 31, 2024, management determined that the market conditions for used revenue equipment had deteriorated since its peak in 2022.

17 unchanged sentences

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.

What changed 10-K

Item 5. Market for Registrant’s Common Equity