CVLG 10-K & 10-Q changes, risk factors and insider trading

The truckload industry is highly cyclical, and our business is dependent on a number of factors that may have a materially adverse effect on our results of operations, many of which are beyond our control. We believe that some of the most significant of these factors include (i) recessionary economic cycles; (ii) changes in customers’ inventory levels and practices, including shrinking product/package sizes, and in the availability of funding for their working capital; (iii) changes in the way our customers choose to utilize our services; (iv) downturns in our customers’ business cycles, including declines in consumer spending, (v) excess trucking capacity in comparison with shipping demand, (vi) driver shortages and increases in driver’s compensation, (vii) industry compliance with ongoing regulatory requirements, (viii) the availability and price of new revenue equipment and/or declines in the resale value of used revenue equipment; (ix) the impact of public health crises, epidemics, pandemics, or similar events, such as COVID-19events; (x) compliance with ongoing regulatory requirements; (xi) strikes, work stoppages or work slowdowns at our facilities, or at customer, port, border crossing or other shipping-related facilities, including related reductions in demand; (xii) increases in interest rates, inflation, fuel taxes, insurance, tolls, and license and registration fees; (xiii) changes in trade policy and tariff rates; and (xiv) rising costs of healthcare.

Economic conditions that decrease shipping demand or increase the supply of available tractors and trailers can exert downward pressure on rates and equipment utilization, thereby decreasing asset productivity. The risks associated with these factors are heightened when the United StatesU.S. economy is weakened. Some of the principal risks during such times, are as follows:

In addition, events outside our control, such as deterioration of U.S. transportation infrastructure and reduced investment in such infrastructure, public health crises, epidemics, pandemics, or similar event, such as COVID-19,events, strikes or other work stoppages at our facilities or at customer, port, border or other shipping locations, armedglobal conflicts, including the conflicts in Ukraine and the Middle East or as a result of rising tensions between China and Taiwan, terrorist attacks, efforts to combat terrorism, military action against a foreign state or group located in a foreign stateaction, or heightened security requirements could lead to wear, tear and damage to our equipment, driver dissatisfaction, reduced economic demand and freight volumes, reduced availability of credit, increased prices for fuel, or temporary closing of the shipping locations or U.S. borders. Such events or enhanced security measures in connection with such events could impair our operating efficiency and productivity and result in higher operating costs.

The Trumpimposition administration has stated its intention to imposeof new or increased tariff rates on imported goods from a number of countries, including China, Canada, Mexico,tariffs and the E.U. Suchother trade policies and tariff implementations,restrictions, and any related retaliatory trade policies and tariff implementations by foreign governments may result in decreased shipping volumes and have an adverse impact on our revenues and results of operations.

Our initiatives include continuingexiting tounprofitable improvebusiness relationships, moderately reducing our total truckload fleet (while growing the durabilitymost ofprofitable contractscomponents), improving free cash flow, deleveraging our balance sheet, and opportunistically investing in ourareas Expeditedthat differentiate us from other carriers, such as high value and Dedicatedhigh reportableservice segments,requirement growing our Dedicated reportable segment, with new poultry related business, delivering more consistent returns for our stockholders, increasing operating income and margins in each of our segments, improving profitability, and reducing costs and inefficiencies.freight. Such initiatives will require time, management and financial resources, and changes in our operations and sales functions, and monitoring and implementation of technology.functions. We may be unable to effectively and successfully implement, or achieve sustainable improvement from, our strategic plan and initiatives or achieve these objectives. In addition, our operating margins could be adversely affected by future changes in and expansion of our business. Further, our operating results may be negatively affected by a failure to further penetrate our existing customer base, cross-sell our services, pursue new customer opportunities, or manage the operations and expenses. There is no assurance that we will be successful in achieving our strategic plan and initiatives. Even if we are successful in achieving our strategic plan and initiatives, we still may not achieve our goals. If we are unsuccessful in implementing our strategic plan and initiatives, our financial condition, results of operations, and cash flows could be adversely affected.

Generally, we do not have contractual relationships that guarantee any minimum volumes with our customers, and there can be no assurance that our customer relationships will continue as presently in effect. Our business with the Department of DefenseWar is not subject to a contract, requires significant compliance work, and could be terminated at any time. Our Dedicated reportable segment is typically subject to longer term written contracts than our other reportable segments. However, certain of these contracts contain cancellation clauses, including our “evergreen” contracts, which automatically renew for one-year terms but that can be terminated more easily. There is no assurance any of our customers, including our Dedicated customers, will continue to utilize our services, renew our existing contracts, or continue at the same volume levels. For our multi-year and Dedicated contracts, the rates we charge may not remain advantageous. Further, despite the existence of contractual arrangements, certain of our customers may nonetheless engage in competitive bidding processes that could negatively impact our contractual relationship. In addition, certain of our major customers may increasingly use their own truckload and delivery fleets, which would reduce our freight volumes. A reduction in or termination of our services by one or more of our major customers, including our Dedicated customers, could have a material adverse effect on our business, financial condition, and results of operations.

We may not be able to improve profitability in the future. Improving profitability depends upon numerous factors, including our ability to effectively and successfully implement other strategic initiatives, increase our average revenue per tractor, improve driver retention, implement technology, and control costs and inefficiencies. If we are unable to improve our profitability, then our liquidity, financial position, and results of operations may be adversely affected.

Acquisitions have provided a substantial portion of our growth. We may not have the financial capacity or be successful in identifying, negotiating, or consummating any future acquisitions. If we fail to make any future acquisitions, our historical growth rate could be materially and adversely affected. Any acquisitions we undertake could involve the dilutive issuance of equity securities and/or incurring indebtedness, the terms of which may be less favorable to us than anticipated. Any future acquisitions we may consummate involve numerous risks, any of which could have a materially adverse effect on our business, financial condition, and results of operations, including:

Although we do not have any direct operations inoutside Russia, Belarus, Ukraine,of the Middle East, China, or Taiwan,U.S., we may be affected by the broader consequences of the conflictsglobal in Ukraine or the Middle East, or expansion ofconflicts, such conflicts to other areas or countries or similar conflicts elsewhere, such as,as increased inflation, supply chain issues (including access to parts for our revenue equipment), embargoes, geopolitical shift, access to diesel fuel, higher energy prices, potential retaliatory actionactions by the Russian or other governments, including cyber-attacks, and the extent of the conflict’s effect on the global economy. The increased tensions between China and Taiwan, and any resulting hostilities, may have similar consequences. The magnitude of these risks cannot be predicted, including the extent to which the conflict may heighten other risks disclosed herein. Ultimately, these or other factors could materially and adversely affect our results of operations.

Our business is subject to the risk of litigation by employees, independent contractors, customers, vendors, government agencies, stockholders, and other parties through private actions, class actions, administrative proceedings, regulatory actions, and other processes. Recently, trucking companies, including us, have been and currently are subject to lawsuits, including class action lawsuits, alleging violations of various federal and state wage and hour laws regarding, among other things, employee meal breaks, rest periods, overtime eligibility, and failure to pay for all hours worked. A number of these lawsuits have resulted in the payment of substantial settlements or damages by the defendants. We operate a business that hauls arms, ammunitions, explosives, and explosivesother hazardous materials that could increase our exposure if there were an accident involving this freight.

The outcome of litigation, particularly class action lawsuits and regulatory actions, is difficult to assess or quantify, and the magnitude of the potential loss relating to such lawsuits may remain unknown for substantial periods of time. The cost to defend litigation may also be significant. Not all claims are covered by our insurance, and there can be no assurance that our coverage limits will be adequate to cover all amounts in dispute. Additionally, our premiums for certain insurance layers are subject to upward adjustments based on claims experience. To the extent we experience claims that are uninsured, exceed our coverage limits, involve significant aggregate use of our self-insured retention amounts, or cause increases in futureour insurance premiums, theit could lead to increased volatility in our insurance and claims expense and any resulting increases in such expenses could have a materially adverse effect on our business, results of operations, financial condition, or cash flows.

We self-insure for a significant portion of our claims exposure,and have exposure outside of our insurance coverage, which could significantly increase the volatility of, and decrease the amount of, our earnings.

Our business results in a substantial number of claims and litigation related to personal injuries, property damage, workers’ compensation, employment issues, health care, and other issues. We self-insure a significant portion of our claims exposure,and have exposure outside of our insurance coverage, which could increase the volatility of, and decrease the amount of, our earnings, and could have a materially adverse effect on our results of operations. See Note 1, "Summary of Significant Accounting Policies," of the accompanying consolidated financial statements for more information regarding our self-insured retention amounts. Our future insurance and claims expenses may exceed historical levels, which could reduce our earnings. We currentlyrecord accruea amountsliability for liabilitiesthe basedestimated on our assessmentcost of the uninsured portion of pending claims and the estimated allocated loss adjustment expenses, including legal and other direct costs associated with a claim, when we believe that it is probable that a loss has been incurred and the amount can be reasonably estimated. There are inherent uncertainties in these legal matters, some of which are beyond management’s control, making the ultimate outcomes difficult to predict. Moreover, management's views and estimates related to pending claims may change in the future, as new events and circumstances arise and our insurance coverage for the periodsmatters in which the claims arise, and we evaluate and revise these accruals from timecontinue to time based on additional information.develop. Actual settlement of such liabilities could differ from our estimates due to a number of uncertainties, including evaluation of severity, legal costs, and claims that have been incurred but not reported. Due to our significant self-insured amounts,amounts and exposure outside of insurance coverage, we have significant exposure to fluctuations in the number and severity of claims and the risk of being required to accrue or pay additional amounts if our estimates are revised or the claims ultimately prove to be more severe than originally assessed. Historically, we have had to significantly adjust our reservesaccruals on several occasions, and future significant adjustments may occur. Further, our self-insured retention levels could change and result in more volatility than in recent years. If we are required to accrue or pay additional amounts because our estimates are revised or the claims ultimately prove to be more severe than originally assessed orassessed, if our self-insured retention levels or overall coverage change, or we experience claims not covered by our insurance, our financial condition and results of operations may be materially adversely affected.

We maintain insurance for most risks above the amounts for which we self-insure with licensed insurance carriers. If any claim were to exceed our coverage, or fall outside the aggregatescope or coverage limit, we would bear the excess or uncovered amount, in addition to our other self-insured amounts. Insurance carriers have recently raised premiums for our industry, and premiums in the near term are expected to continue to increase. Our insurance and claims expense could increase if we have a similar experience at renewal, or we could find it necessary to raise our self-insured retention or decrease our aggregate coverage limits when our policies are renewed or replaced. Additionally, with respect to our insurance carriers, the industry is experiencing a decline in the number of carriers and underwriters that offer certain insurance policies or that are willing to provide insurance for trucking companies, and the necessity to go off-shore for insurance needs has increased. This may materially adversely affect our insurance costs or make insurance in excess of our self-insured retention more difficult to find, as well as increase our collateral requirements for policies that require security. Should these expenses increase, we become unable to find excess coverage in amounts we deem sufficient, we experience a claim in excess of our coverage limits, we experience a claim for which we do not have coverage, or we have to increase our reservesaccruals or collateral, there could be a materially adverse effect on our results of operations and financial condition.

Our auto liability insurance policy contains a provision under which we have the option, on a retroactive basis, to assume responsibility for the entire cost of covered claims during the policy period in exchange for a refund of a portion of the premiums we paid for the policy. This is referred to as "commuting" the policy. We have elected to commute policies on several occasions in the past. In exchange, we have assumed the risk for all claims during the years for the policies commuted. Our subsequent payouts for the claims assumed have been less than the refunds. We expect the total refunds to exceed the total payouts; however, not all of the claims have been finally resolved and we cannot assure you of the result. We may continue to commute policies for certain years in the future. To the extent we do so, and one or more claims result in large payouts, we will not have insurance, and our financial condition, results of operation, and liquidity could be materially and adversely affected. For additional clarification, see Note 16, "Commitments and Contingencies" of our consolidated financial statements.

Our self-insurance for auto liability claims and our use of a captive insurance companiescompany could adversely impact our operations.

Covenant Transport, LLC has been approved to self-insure for auto liability by the FMCSA. We believe this status, along with the use of a captive insurance companies,company, allows us to post substantially lower aggregate letters of credit and restricted cash than we would be required to post without this status or the use of captive insurance companies. We have two wholly owneda captive insurance subsidiariescompany. whichOur arecaptive insurance subsidiary is a regulated insurance companiescompany through which we insure a portion of our auto liability claims in certain states. An increase in the number or severity of auto liability claims for which we self-insure through theour captive insurance companiescompany or pressure in the insurance and reinsurance markets could adversely impact our earnings and results of operations. Further, both arrangements increase the possibility that our expenses will be volatile.

Our captive insurance companiescompany areis regulated by state authorities. State regulations generally provide protection to policy holders, rather than stockholders. Such regulations may increase our costs, limit our ability to change premiums, restrict our ability to access cash held by these subsidiaries, and otherwise impede our ability to take actions we deem advisable.

We, our drivers, and our equipment are regulated by the DOT, the EPA, the DHS, the U.S. Department of Defense,War, and other agencies in states in which we operate. The sections of Environmental and Other Regulation included in “Regulation” under “Item 1. Business” discuss several proposed, pending, suspended, and final regulations that could materially impact our business and operations. Our 2022 acquisition of an arms, ammunitions, and explosives carrier requires us to meet stringent rules relating to those operations and failure to comply could result in loss of all business purchased and our related investment. Future laws and regulations may be more stringent, require changes in our operating practices, influence the demand for transportation services or require us to incur significant additional costs. Higher costs incurred by us, or by our suppliers who pass the costs onto us through higher supplies and materials pricing, or liabilities we may incur related to our failure to comply with existing or future regulations could adversely affect our results of operations.

Developments in labor and employment law and any unionizing efforts by employees or employees of related businesses could have a materially adverse effect on our results of operations.

Compliance with and changes to various environmental laws and regulations upon which our operations are subject may increase our costs of operations and non-compliance with such laws and regulations could result in substantial fines or penalties.

In addition to direct regulation under the DOT and related agencies, we are subject to various environmental laws and regulations dealing with the hauling and handling of hazardous materials, fuel storage tanks, air emissions from our vehicles and facilities, and discharge and retention of storm water. Our tractor terminals are often are located in industrial areas where groundwater or other forms of environmental contamination may have occurred or could occur. Our operations involve the risks of fuel spillage or seepage, environmental damage, and hazardous waste disposal, among others. We also maintain above-ground bulk fuel storage tanks and fueling islands at several of our facilities. A small percentage of our freight consists of low-grade hazardous substances, which subjects us to a wide array of regulations.regulations, and another portion consists of high security cargo such as arms, ammunitions, and explosives, which subjects us to a myriad of regulatory requirements concerning the storage, handling and transportation of hazardous materials, chemicals, and explosives. Although we have instituted programs to monitor and control environmental risks and promote compliance with applicable environmental laws and regulations, if we are involved in a spill or other accident involving hazardous substances, if there are releases of hazardous substances we transport, if soil or groundwater contamination is found at our facilities or results from our operations, or if we are found to be in violation of applicable laws or regulations, we could be subject to cleanup costs and liabilities, including substantial fines or penalties or civil and criminal liability, any of which could have a materially adverse effect on our business and operating results.

Governmental agencies continue to enact more stringentrevise laws and regulations toregarding reducegreenhouse enginegases and emissions. These laws and regulations are applicable to engines used in our revenue equipment. WeWhen these laws and regulations have incurredbecome more stringent, we have incurred, and continue to incurincur, costsincreased relatedcompliance costs. More recently, the EPA proposed to repeal certain federal regulations regarding greenhouse gases and emissions, which could lead to more states enacting similar laws, resulting in a patchwork of emission regulations, which may increase our compliance costs. Legal challenges to the implementationrepeal or enactment of these more rigoroussuch laws and regulations.regulations at both the federal and state level could lead to uncertainty regarding our compliance which may negatively affect our results of operations. Additionally, in certain locations governments have banned or may in the future ban internal combustion engines for some types of vehicles. To the extent these bans affect our revenue equipment, we may be forced to incur substantial expense to retrofit existing engines or make capital expenditures to update our fleet. As a result, our business, results of operations, and financial condition could be negatively affected.

Changes to trade regulation, quotas,export controls, duties, or tariffs, caused by the changing U.S. and geopolitical environments or otherwise, may increase our costs and materially adversely affect our business.

Since April 2025, new substantial tariffs have been imposed on imports to the U.S. The imposition of additional tariffs or quotasexport orcontrols, changes to certain trade agreements, includingor tariffsretaliatory appliedtrade to goods traded between the United States and China, and proposed changes to tariffs on various imports from other countries (such as Canada, Mexico, and the E.U.)policies could, among other things, increase the costs of the materials used by our suppliers to produce new revenue equipment or increase the price of fuel. Such cost increases for our revenue equipment suppliers would likely be passed on to us, and to the extent fuel prices increase, we may not be able to fully recover such increases through rate increases or our fuel surcharge program, either of which could have a material adverse effect on our business. Further, such tariffs or other trade restrictions, or changes in trade agreements could exacerbate the effects of other macroeconomic or geopolitical conditions, the severity and impacts of which are uncertain, and as a result, our business, results of operations, and financial condition could be negatively affected.

To the extent regulatory changes continueare relatedaimed toat curbing climate change, we could incur significant costs to our operation, mainly centered around our revenue producing equipment and our warehousing operations. We are not able to accurately predict the materiality of any potential losses or costs. Concern over climate change, including the impact of global warming, has previously led to significant legislative and regulatory efforts to limit carbon and other greenhouse gas emissions. Emission-related regulatory actions have historically resulted in increased costs related to revenue equipment, diesel fuel, equipment maintenance, and environmental monitoring or reporting requirements, and future legislation, if any, could impose substantial costs that may adversely affect our results of operations. In addition, any such legislation may require changes in our operating practices, impair equipment productivity, or require additional reporting disclosures, and compliance with any such legislation may increase our risk of litigation or governmental investigations or proceedings.

Conflicting views on environmental, socialenvironmental and governance (“ESG”)societal matters may have a negative impact on our business, impose additional costs on us, and expose us to additional risks.

Certain stakeholders have pressured companies on initiatives relating to ESGenvironmental and societal matters, including environmentalmatters stewardship,related social responsibility, andto corporate governance. Organizations that provide information to investors on corporate governance and related matters have developed ratings processes for evaluating companies on their approach to ESGenvironmental and societal matters. Such ratings are used by some investors to inform their investment and voting decisions. Unfavorable ESG ratings may lead to negative investor sentiment toward the Company, which could have a negative impact on our stock price. Additionally,Further, givenstandards thefor Trump administration’s initiatives surrounding ESGtracking and diversity,reporting equity,environmental and inclusionsocietal matters,matters whichcontinue to evolve, and our reporting may conflictnot withmatch stakeholder initiatives on such matters, we may experience conflicts between governmental regulations and stakeholder expectations which could impose additional costs on our business and negatively impact investor sentiment.expectations.

Like many truckload carriers, we experience substantial difficulty in attracting and retaining sufficient numbers of qualified drivers, which includes the engagement of independent contractors. The truckload industry periodically experiences a shortage of qualified drivers, particularly during periods of economic expansion, in which alternative employment opportunities, including in the construction and manufacturing industries, are more plentiful and freight demand increases, or during periods of economic downturns, in which unemployment benefits might be extended and financing is limited for independent contractors who seek to purchase equipment or for students who seek financial aid for driving school. Furthermore, increased scrutiny of accreditation of driving schools and limitations on capacity at driving schoolsschools, maywhether beresulting limited byfrom future outbreaks of contagious diseases, likeany COVID-19.governmental imposed lockdown or other attempts to reduce the spread of such an outbreak, or other factors may reduce the pool of potential drivers available to us. Regulatory requirements, including those related to safety ratings, ELDs, hours-of-service changes, government-imposed measures related to future outbreaks of contagious diseases, like COVID-19, and an improved economyrequirements could further reduce the number of eligible drivers or force us to increase driver compensation to attract and retain drivers. WeSuch haveregulatory seenrequirements evidenceinclude thatthose stricterrelated hours-of-serviceto regulationssafety adoptedratings, byELDs, and hours-of-service, as well as the DOT guidelines issued in 2025 strengthening enforcement of the pastFMCSA’s havelongstanding tightened,English and,proficiency to the extent new regulations are enacted, may continue to tighten, the marketrequirements for eligible drivers. The lack of adequate tractor parking along some U.S. highways and congestion caused by inadequate highway funding may make it more difficult for drivers to comply with hours-of-service regulations and cause added stress for drivers, further reducing the pool of eligiblecommercial drivers. Further, the compensationFMCSA weissued offeran ourinterim driversrule in 2025 revising the requirements for the issuance or renewal of CDLs to non-domiciled persons and independentrestricting contractorthe expensesissuance areor subjectrenewal of a CDL for non-domiciled persons without a lawful immigration status or legitimate employment-based reason to markethold conditions,a CDL. While the interim rule has been challenged and weenforcement mayhas findbeen temporarily stayed by a federal appeals court while it necessaryreviews the legality of the interim rule, it remains uncertain whether there will be further changes to increasethe driverinterim and independent contractor compensationrule in futureresponse periods.to such challenges or whether it will go into effect as originally issued.

Our agreements with the independent contractors we engage are governed by the federal leasing regulations, which impose specific requirements on us and the independent contractors. If more stringent federal leasing regulations are adopted, independent contractors could be deterred from becoming independent contractor drivers, which could materially adversely affect our goalability ofto growing our current fleet levels ofengage independent contractors.

Our Managed Freight reportable segment is dependent upon the services of third-party capacity providers, including other truckload carriers. For this business, we do not own or control the transportation assets that deliver our customers' freight, and we do not employ or control the people directly involved in delivering the freight. This reliance could also cause delays in reporting certain events, including recognizing revenue and claims. These third-party providers may seek other freight opportunities and may require increased compensation in times of improved freight demand or tight truckload capacity. If we are unable to secure the services of these third-partiesthird orparties, if we become subject to increases in the prices we must pay to secure such services, or if we become responsible for accidents involving these providers, our business, financial condition, and results of operations may be materially adversely affected, and we may be unable to serve our customers on competitive terms. Our ability to secure sufficient equipment or other transportation services may be affected by many risks beyond our control, including equipment shortages increased equipment prices, interruptions in service due to labor disputes, driver shortages, changes in regulations impacting transportation, and changes in transportation rates. For additional clarification, see Note 16, "Commitments and Contingencies" of our consolidated financial statements.

We depend on the proper functioning and availability of our management information and communication systems and other information technology assets (including the data contained therein) and a system failure or unavailability, including those caused by cybersecurity breaches internally or with third-parties,third parties, or an inability to effectively upgrade such systems and assets could cause a significant disruption to our business and have a materially adverse effect on our results of operations.

Our operations and those of our technology and communications service providers are vulnerable to interruption by natural disasters, such as fires, storms, and floods, which may increase in frequency and severity due to climate change, as well as, power loss, telecommunications failure, cyberattacks, terrorist attacks, Internet failures, computer viruses, and other events beyond our control. More sophisticated and frequent cyberattacks in recent years have also increased security risks associated with information technology systems. We also maintain information security policies to protect our systems, networks, and other information technology assets (and the data contained therein) from cybersecurity breaches and threats, such as hackers, malware, and viruses; however, such policies cannot ensure the protection of our systems, networks, and other information technology assets (and the data contained therein). In addition, remote or flexible work options for our employees could create increased demand for information technology resources and increase the avenues for unauthorized access to sensitive information, phishing, and other cyberattacks. If any of our critical information systems fail or become otherwise unavailable, whether as a result of a system upgrade project or otherwise, we would have to perform the functions manually, which could temporarily impact our ability to dispatch and manage our fleet efficiently, to respond to customers' requests effectively, to maintain billing and other records reliably, and to bill for services and prepare financial statements accurately or in a timely manner. Our business interruption insurance may be inadequate to protect us in the event of an unforeseeable and extreme catastrophe. Any significant system failure, upgrade complication, security breach (including cyberattacks), or other system disruption could interrupt or delay our operations, damage our reputation, cause us to lose customers, or impact our ability to dispatch and manage our operations and report our financial performance, any of which could have a materially adverse effect on our business. Such risks related to system failure, upgrade complication, security breach (including cyberattacks), or other system disruption may also impact our customers, vendors, third-party capacity providers, and other counterparties, which could result in declines and volatility in customer demand and unavailability of products and services from vendors and third-party capacity providers, any of which would have a material adverse effect on our business. In addition, we are currently dependent on a single vendor to support several information technology functions. If the stability or capability of such vendor became compromised and we were forced to migrate such functions to a new platform, it could adversely affect our business, financial condition, and results of operations. For further discussion of our cybersecurity programs, please see "Item 1C. Cybersecurity."

In addition, the adoption of artificial intelligence (“AI”) and other emerging technologies may become significant to operating results in the future.future, including in areas such as brokerage, dispatch, routing, pickup, and delivery appointments, and other areas where automation is possible. While AI and other technologies may offer substantial benefits, they may also introduce additional risk.risk, including those relating to errors or inaccuracies in work product developed through the use of AI and privacy, intellectual property, and legal and regulatory risks. If we are unable to successfully implement and utilize such emerging technologies as effectively as competitors, we may be at a competitive disadvantage to such competitors and our results of operation may be negatively affected. Furthermore, the use of AI by bad actors may make cyberattacks more difficult to anticipate or detect, and we may be unable to implement adequate preventive or curative measures in the case of such an attack.

We face a wide variety of risks related to public health crises, epidemics, pandemics, or similar events, such as COVID-19.events. If a new health epidemic or outbreak were to occur, we could experience broad and varied impacts similar to the impact of COVID-19,impacts, including adverse impacts to our workforce, our operations, equipment availability and financial results, such as increased costs, tightening of credit markets, greater risk for collection of amounts owed, market volatility and a weakened freight environment. If any of these were to occur, our operations, financial condition, liquidity, results of operations, and cash flows could be adversely impacted.

Our subsidiary, LTSTLTST, derives the majority of its revenue from the transportation of poultry and feed products related to poultry operations. While LTST does not transport eggs, a widespread outbreak of avian flu or related illness among our customers’ poultry flocks could reduce the volume of loads hauled for such customers. Additionally, public concern following a nation-wide or well-publicized outbreak of avian flu may cause fear about the consumption of chicken, turkey, eggs, and other products derived from poultry, which could cause customers to consume less poultry and related products, reducing the volume of poultry and related products produced and negatively affecting the revenues of LTST. Any decrease in the revenue of LTST may negatively impact our income and results of operations.

A decrease in vendor output may have a materially adverse effect on our ability to purchase or take possession of a quantity of new revenue equipment that is sufficient to sustain our desired growth rate and to maintain a late-model fleet. Tractor and trailer vendors may reduce their manufacturing output in response to lower demand for their products in economic downturns or shortages of component parts. DuringIn therecent COVID-19 pandemicyears, some tractor and trailer manufacturers experienced periodic shortages of certain component parts and supplies, including semi-conductor chips, forcing such manufacturers to curtail or suspend their production, which led to a lower supply of tractors and trailers and higher prices. If such shortages occur again, such shortages could have a material adverse effect on our business, financial condition, and results of operations, particularly our maintenance expense, driver retention, and the length of our trade cycle.

A depressed market for used equipment could require us to trade our revenue equipment at depressed values or to record losses on disposal or impairments of the carrying values of our revenue equipment that is not protected by residual value arrangements. Used equipment prices are subject to substantial fluctuations based on freight demand, the supply of new and used equipment, the availability and terms of financing, the presence of buyers for export to foreign countries, the desirability of specific models of used equipment, and commodity prices for scrap metal. If there is a deterioration of resale prices, it could have a material adverse effect on our business, financial condition, and results of operations. In 2022 through 2024, we experienced a softened used equipment market.

We hold a 49% interest in TEL, a used equipment leasing company and reseller. We account for our investment in TEL using the equity method of accounting. TEL faces several risks similar to those we face and additional risks particular to its business and operations. TEL has significant ongoing capital requirements and carries significant debt. The ability to secure financing and market fluctuations in interest rates could impact TEL's ability to grow its leasing business and its margins on leases. Adverse economic activity may restrict the number of used equipment buyers and their ability to pay prices for used equipment that we find acceptable. In addition, TEL's leasing customers are typically small trucking companies without substantial financial resources, and TEL is subject to risk of loss should those customers be unable to make their lease payments or declare bankruptcy, which has happened in the past. A portion of TEL’s business includes leasing equipment to individual independent contractors who are generally not required to provide significant amounts to secure their obligations under the lease agreements with TEL. Such independent contractors generally have few assets and are at a heightened risk of defaulting under such lease agreements, which may cause TEL to incur unreimbursed costs related to the recovery of equipment, equipment maintenance and repair, missed lease payments, and the reletting of the equipment. In addition, the shrinking independent contractor market may decrease the number of drivers available to utilize such portion of TEL’s business and could decrease TEL’s revenues. Further, we believe the used equipment market will significantly impact TEL's results of operations and such market has been volatile in the past and declinedhas been soft recently. There can be no assurance that TEL will experience gains on sale similar to those it has experienced in the past and it may incur losses on sale. As regulations change, the market for used equipment may be impacted as such regulatory changes may make used equipment costly to upgrade to comply with such regulations or we may be forced to scrap equipment if such regulations eliminate the market for particular used equipment. Further, there is an overlap in providers of equipment financing to TEL and our wholly owned operations and those providers may consider the combined exposure and limit the amount of credit available to us.

As of December 31, 2024, we had goodwill of $78.9 million and other intangible assets of $90.1 million. We evaluate our goodwill and other intangible assets for impairment. We could recognize further impairments in the future, and we may never realize the full value of our goodwill or intangible assets. If these eventsevent occur, our profitability and financial condition will suffer.

Our Chairman of the Board and Chief Executive Officer, David Parker, and his wife, Jacqueline Parker, beneficially own or have sole voting and dispositive power approximately 13% of our outstanding Class A common stock and 100% of our Class B common stock. On all matters with respect to which our stockholders have a right to vote, including the election of directors, each share of Class A common stock is entitled to one vote, while each share of Class B common stock is entitled to two votes. All outstanding shares of Class B common stock are owned by our Chairman of the ParkersBoard and Chief Executive Officer, David Parker, and his wife Jacqueline (together, the "Parkers"). Shares of Class B common stock are convertible to Class A common stock on a share-for-share basis at the election of the Parkers or automatically upon transfer to someone outside of the ParkerParkers' immediate family. ThisAs votinga structureresult givesof the two-class structure, and including 800,000 unexercised options to purchase Class A common stock that are held by Mr. Parker, the Parkers may be deemed to control stock possessing approximately 39%41% of the voting power of all of our outstanding stock. As such, the Parkers are able to substantially influence decisions requiring stockholder approval, including the election of our entire Board, the adoption or extension of anti-takeover provisions, mergers, and other business combinations. This concentration of ownership could limit the price that some investors might be willing to pay for the Class A common stock, and could allow the Parkers to prevent or could discourage or delay a change of control, which other stockholders may favor. The interests of the Parkers may conflict with the interests of other holders of Class A common stock, and they may take actions affecting us with which other stockholders disagree.

Moreover, Mr. Parker serves as both our Chief Executive Officer and Chairman of our Board. Although the Board has determined that the combination of Chief Executive Officer and Chairman of the Board positions is the most appropriate and suitable structure for proper and efficient Board functioning and communication, Mr. Parker may have an outsized ability to influence the operations of the Company, which may result in conflicts with the interests of Mr. Parker, the Parker Family,Parkers and the interests of our other stockholders.

Our ThirdFourth Amended and Restated Articles of Incorporation (“Articles of Incorporation”), our Sixth Amended and Restated Bylaws ("Bylaws"), and Nevada corporate law contain provisions that could delay, discourage or prevent a change of control or changes in our Board or management that a stockholder might consider favorable. For example, our Articles of Incorporation authorize our Board to issue preferred stock without stockholder approval and to set the rights, preferences and other terms thereof, including voting rights of those shares; our Articles of Incorporation do not provide for cumulative voting in the election of directors, which would otherwise allow holders of less than a majority of stock to elect some directors; our Class B common stock possesses disproportionate voting rights; and our Bylaws provide that a stockholder must provide advance notice of business to be brought before an annual meeting or to nominate candidates for election as directors at an annual meeting of stockholders. These provisions will apply even if the change may be considered beneficial by some of our stockholders, and thereby negatively affect the price that investors might be willing to pay in the future for our Class A common stock. Furthermore, pursuant to the “Acquisition of Controlling Interest” statutes set forth in Sections 78.378 to 78.3793, inclusive, of the Nevada Revised Statutes (the “Control Statutes”), if a person acquires a controlling interest in the Company (defined in Nevada Statutes Section 78.3785 as ownership of voting securities to exercise voting power in the election of directors in excess of 1/5, 1/3, or a majority thereof), the voting rights of such person in excess of the applicable threshold would be nullified, unless the acquirer obtains approval of the disinterested stockholders or unless the Company amends its Articles of Incorporation or Bylaws within ten days of the acquisition to provide that the Control Statutes do not apply to the Company or to types of existing or future stockholders. Our Bylaws provide that the Control Statutes do not apply to an acquisition of a controlling interest in the Company by the Parkers or their affiliates. In addition, to the extent that these provisions discourage an acquisition of our company or other change in control transaction, they could deprive stockholders of opportunities to realize takeover premiums for their shares of our Class A common stock.

Our effective tax rate may be adversely impacted by, among other things, changes in the regulations relating to capital expenditure deductions, or changes in tax laws where we operate, including the uncertainty of future tax rates. The OBBBA was signed into law in 2025. The OBBBA, among other things, includes provisions that permanently restored 100% bonus depreciation, reinstated current deductibility of domestic research and development under Section 174, eased the Section 163(j) interest limitation through a return to earnings before interest, taxes, depreciation, and amortization, and rolled back certain alternative energy credits. Although we do not expect the OBBBA to have a negative effect on our financial position, results of operations, and cash flows, until certain regulations are promulgated, we may not know the full extent of the OBBBA’s effects on our financial results and financial position. Additionally, President Trump has indicated a desire to potentially amend the federal tax laws.laws further. Until any changes are passed into law we will not know if such changes, if any, will have a materially adverse effect on our financial results and financial position. Any changes to the federal tax laws are likely to have an immediate revaluation of our deferred tax assets and liabilities in the year of enactment.

The increase in total revenue resulted from a $44.1$37.9 million and $1.0$36.8 million increase in DedicatedManaged Freight and WarehouseDedicated freight revenue, respectively, partially offset by a $10.0$29.5 million and $7.4$0.5 million decrease in freight revenue from our Managed FreightExpedited and ExpeditedWarehousing reportable segments, respectively.

The increase in salaries, wages, and related expenses on a dollars basis is primarily the result of pay increases due to the expanded scale of our Dedicated agriculture supply chain operations and the strategic reduction in commoditized freight across the Expedited and Dedicated fleets since the prior period, as well as averaging more drivers and tractors resulting in higher driver salaries, wages, and benefits as a result of growth in Dedicated,Dedicated. alongAs witha increasedpercentage shopof technicianfreight salariesrevenue salaries, wages, and benefits,related workersexpenses compensationdecreased andas groupthe healthforegoing costs,factors partiallyincreasing these expenses were offset by contracta laborlower reductions.percentage of revenue from Expedited, where we have driver pay, and a higher percentage of revenue from Managed Freight, where we don't have driver pay.

We believe driver and non-driver, including shop technicians, pay and benefits will continue to increase as the result of wage inflation, higher healthcare costs, and, in certain periods, increased incentive compensation due to better performance. Driver pay may also fluctuate based on the number of miles driven. While driver pay remains stable at the present time, we have historically put driver pay increases in place as necessary to address driver market pressure and will continue to do so in the future as necessary. If freight market rates increase, we would expect to, as we have historically, pass a portion of those rate increases on to our professional drivers. Salaries, wages, and related expenses will fluctuate to some extent based on the percentage of revenue generated by independent contractors and our Managed Freight reportable segment, for which payments are reflected in the purchased transportation line item.item, as well as the mix of specialized freight (which requires higher driver pay) and commoditized freight.

Net fuel expense decreasedincreased $2.5$6.5 million, or 25.1%,87.3%, for the year ended December 31, 2024,2025, compared to 2023.2024. As a percentage of freight revenue, net fuel expense decreasedincreased 0.3%0.6% for the year ended December 31, 2024,2025, compared to 2023,2024, primarily due to decreased fuel surcharge recovery partially offset by lower fuel prices. There were no diesel fuel hedge gains or loss for the years ended December 31, 2024 or 2023. As of December 31, 2024, we had no remaining fuel hedge contracts.

The decreaseincrease in operations and maintenance expense was primarily related to the reduced maintenance costs as a result of thehigh Company'sdemands strategic efforts to purchase neweron equipment andas replacewe oldergrow our fleet into specialty freight areas, as well as more equipment thatdamage than was moreexperienced costlyin tothe maintain.prior year.

Going forward, we believe this category will fluctuate based on several factors, including the condition of the driver market and our ability to hire and retain drivers, our continued ability to maintain a relatively young fleet, accident severity and frequency, weather, the reliability of new and untested revenue equipment models, our mix of specialty and thecommoditized globalfreight, and any disruption of the supply chain. Additionally, operations and maintenance costs may increase if we experience wage and parts inflation.

The decreaseincrease in revenue equipment rentals and purchased transportation was primarily the result of aan reductionincrease in purchased transportation costs inrelated ourto new business awarded to the Managed Freight reportable segment as a result ofduring the softening freight market, the reduction in leased revenue equipment as the result of largely transitioning from tractors held under operating leases to owned tractors in 2023. These decreases wereyear, partially offset by a slight increasedecrease in the percentage of the total miles run by independent contractors from 7.5% for 2023 to 7.8% for 2024.2024 to 7.3% for 2025 and a first quarter $7.6 million decrease in purchased transportation costs due to the decline in the spot market that primarily affected the Managed Freight reportable segment.

We expect purchased transportation to fluctuate as volumes in our Managed Freight reportable segment may be volatile. In addition, if fuel prices increase, it would result in a further increase in what we pay third-party carriersproviders and independent contractors. However, this expense category will fluctuate with the number and percentage of loads hauled by independent contractors, loads handled by Managed Freight, and tractors, trailers, and other assets financed with operating leases. In addition, factors such as the cost to obtain third-party transportation services and the amount of fuel surcharge revenue passed through to the third-party carriersproviders and independent contractors will affect this expense category. If industry-wide trucking capacity tightens in relation to freight demand, we may need to increase the amounts we pay to third-party transportation providers and independent contractors, which could increase this expense category on an absolute basis and as a percentage of freight revenue absent an offsetting increase in revenue. If we were to recruit more independent contractors we would expect this line item to increase as a percentage of revenue.

Insurance and claims per mile cost increased to 21.726.6 cents per mile for 20242025 from 19.121.7 cents per mile in 2023.2024. The increase is primarily the result of an increase in current period claims expenseand premium expense, including the settlement of a large currentauto yearliability claim incurredduring partially2025, offsetbeing byspread aover decreasedecreased in insurance premiumsmiles compared to 2023.the prior year.

Our insurance program includes multi-year policies with specific insurance limits that may be eroded over the course of the policy term. If that occurs, we will be operating with less liability insurance coverage at various levels of our insurance tower.tower and may incur additional premiums. For the policy period that ran from April 1, 2018 to March 31, 2021, the aggregate limits available in the coverage layer $9.0 million in excess of $1.0 million were fully eroded based on claims expense. We replaced our $9.0 million in excess of $1.0 million layer with a new $7.0 million in excess of $3.0 million policy effective starting January 28, 2021 that we continue to maintain. Due to the erosion of the $9.0 million in excess of $1.0 million layer, any adverse developments in claims filed between April 1, 2018 and March 31, 2021, could result in additional expense accruals. As of December 31, 2025, there were no outstanding claims in this layer. We have maintained our retention and limits set in place during the prior renewal cycle. Due to these developments, we may experience additional expense accruals, increased insurance and claims expenses, and greater volatility in our insurance and claims expenses, which could have a material adverse effect on our business, financial condition, and results of operations.

For the period presented, the change in communications and utilities areis insignificant both as a percentage of total revenue and freight revenue.

The increasedecrease in general supplies and expenses was primarily the result of a $15.8$2.8 million increase in the contingent consideration liability sincerecognized thein 20232025 periodcompared to a $16.0 million increase recognized in 2024, partially offset by additional costs related to investments in technology and the acquisitionStar of LTST.Acquisition.

Depreciation increased $14.6$4.9 million in 20242025 to $77.0$81.9 million compared to 2023,2024, primarily as a result of the increased cost of new equipment purchasedand an additional $2.2 million of depreciation expense as parta result of ouran strategicincreased initiativerate toof supportdepreciation growthduring inthe ourquarter Dedicatedended segmentDecember and31, replace older equipment.2025. Amortization of intangible assets increased $2.0$1.3 million in 20242025 to $9.5$10.8 million compared to 2023,2024, primarily due to the amortization of the intangible assets related to the LTST2025 acquisitions. Subsequent to our January 29, 2026 earnings release, we reclassified $6.5 million of depreciation for 2025 from depreciation and Simsamortization acquisitions.to write-down of held-for-sale assets. This reclassification did not change our total operating expenses for 2025.

We expect depreciation and amortization to increase going forward as the cost of new equipment increases and we see the effect of our equipment investment and replacement plan.increases. Additionally, changes in the used tractor market couldhave causecaused us to adjust residual values,values and increase depreciation, and further adjustments may be necessary in the future. These changes may also cause us to hold assets longer than planned, or experience increased losses on sale. SuccessfullyIf executingwe were to grow our 2025Expedited growthor planDedicated couldreportable alsosegments increasewe may face additional increases in depreciation and amortization going forward.amortization.

Loss (gain) on disposition of property and equipment, net

For the period presented, the increasechange in interestdisposition expense,of property and equipment, net is primarilyinsignificant theboth resultas a percentage of an increase intotal revenue equipmentand installmentfreight notes as we implemented our 2024 revenue equipment replacement plan.revenue.

We have accounted for our investment in TEL using the equity method of accounting and thus our financial results include our proportionate share of TEL's net income. For the year ended December 31, 2024, ourOur earnings resulting from our investment in TEL decreased towere $14.7 million.million Thefor decreaseboth in2025 2024and as compared to 2023 is the result of a reduction of gain on sale of revenue equipment.2024. Due to TEL's business model, gains and losses on sale of equipment is a normal part of the business and can cause earnings to fluctuate from period to period and therefore our income from investment to similarly fluctuate. We currently expect TEL's results for 20252026 to remain similar to those of 2024.2025.

The decrease in tax expense primarily relates to the decrease in operating income and earnings on investment in TEL as described above.

Our Expedited total revenue decreased $7.4$43.2 million, as fuel surcharge revenue decreased $10.3$13.7 million and freight revenue increaseddecreased $2.9$29.5 million. The increasedecrease in Expedited freight revenue relates to a 1542 (or 1.7%4.7%) average tractor increasedecrease compared to 2023,2024, partially offset byand a decrease in average freight revenue per tractor per week of 1.1%.3.7%. The decrease in average freight revenue per tractor per week is the result of an approximately 4.4% decrease in average miles per tractor partially offset by a 1.7%,0.5%, or 3.71.1 cents per mile, decreaseincrease in average rate per total mile partially offset by an approximately 0.9% increase in average miles per tractor when compared to 2023.2024. Seated team driven tractors increaseddecreased approximately 1.8%4.9% to an average of 788 teams in 2025 from 829 teams in 2024 from 815 teams in 2023.2024.

Our Dedicated total revenue increased $44.1$38.8 million, as freight revenue increased $49.3$36.8 million and fuel surcharge revenue decreasedincreased $5.2$1.9 million. The increase in Dedicated freight revenue relates to a 133157 (or 10.8%11.5%) average tractor increase and an increase in average freight revenue per tractor per week of 6.6%,0.4%, compared to 2023.2024. The increase in average freight revenue per tractor per week is the result of a 8.0%,8.9%, or 21.325.5 cents per mile, increase in average rate per total mile, aspartially welloffset asby 1.0%8.0% fewer miles per tractor.

Managed Freight total revenue decreasedincreased $10.0$37.9 million in 2024,2025, compared to 20232024 as a result of reducednew volumesbusiness awarded during 2025, the October 2025 Star Acquisition, and the team's effort to identify and execute on overflow capacity from our Expedited reportable segment. During the fourth quarter of high-margin2025, overflowsome freightnew frombusiness bothawarded Expeditedduring and2025 Dedicatedwas truckload operations and excess capacity in the marketplace impacting freight rates and volumes.discontinued. Revenue in this reportable segment is expected to fluctuate with changes in the freight market and our percentage of contracted versus non-contracted freight.

The increase in our revenue equipment installment notes was primarily due to equipmentadditional acquisitionborrowings related to support growth in our Dedicatedtrade reportable segment.cycle. The decrease in operating and finance lease obligations was primarily due to amortization of the respective lease liability.

As of December 31, 2024,2025, we had no$30.0 million borrowings outstanding, undrawn letters of credit outstanding of approximately $19.8$19.9 million, and available borrowing capacity of $90.2$53.3 million under the Credit Facility. Additionally, we had availability of a $45.0 million line of credit from Triumph Bank ("Triumph") which is available solely to fund any indemnification owed to Triumph in relation to the sale of TFS. Fluctuations in the outstanding balance and related availability under our Credit Facility arewere driven primarily by the Star Acquisition, cash flows from operations and the timing and nature of property and equipment additions that are not funded through notes payable and leases, as well as the nature and timing of collection of accounts receivable, payments of accrued expenses, and receipt of proceeds from disposals of property and equipment. Refer to Note 10, “Debt” of the accompanying consolidated financial statements for further information about material debt agreements.

Our net capital expenditures for the year ended December 31, 20242025 totaled $80.8$112.1 million of expenditures as compared to $125.8$80.8 million of expenditures for the prior year. Our 2023 net capital investment included approximately $91 million invested in the fourth quarter to acquire new tractors and trailers, of which approximately $30 million was originally planned to be acquired in 2024. However, due to early availability and the ability to take advantage of certain tax incentives not available to us in 2024, we opportunistically elected to bring these purchases forward. Our baseline expectation for 20252026 fleet net capital expenditures is a range of $70$40 million to $80$50 million andwhich reflectsis oura prioritiessignificant ofreduction growingcompared ourto Dedicated2025 footprint,due maintainingto purchasing fewer new tractors in the averageyear agethan of our fleet in a manner that allows us to optimize operational uptime and related operating costs, and offering a fleet of equipment that our professional driverswe are proud to operate.selling. These assumptions are subject to risk. For example, global supply chain disruptions similar to 2021 and 2022 could impact the availability of tractors and trailers and lead to increased pricing on new and used equipment. Net losses on disposal of equipment and real estate forin December 31, 20242025 were $1.6$0.3 million compared to a net gain of $12.6$1.6 million in 2023, which was primarily due to a $7.6 million gain on the sale of a Tennessee terminal during 2023.2024.

We distributed a total of $7.2 million and $5.8 million to stockholders through dividends during the years ended December 31, 20242025 and 2023,2024, respectively.

Net cash flows used by investing activities were $107.7$140.1 million in 2024,2025, compared with $235.9$107.6 million used in 2023.2024. The decreaseincrease in net cash flows used by investing activities was primarily due to the AprilOctober 20232025 andStar the August 2023 acquisitions of LTST and Sims, respectively,Acquisition for $107.9$27.1 million, netcompared of cash acquired, partially offset byto the $4.6 million payment related to the acquisition of LTST and our Section 338(h)(10) election during the 2024 period, and the timing of our trade cycle whereby we took delivery of approximately 511 new tractors and 1012 new trailers, while disposing of approximately 465 used tractors and 310 used trailers during 2025 compared to delivery of 747 new tractors and 791 new trailers, while disposing of approximately 1,051 used tractors and 444 used trailers during 2024 compared to delivery of 1,242 new tractors and 1,111 new trailers, while disposing of approximately 1,235 used tractors and 634 used trailers in 2023. Additionally, the 2023 period provided $12.5 million of proceeds related to the sale of a Tennessee terminal.2024.

Net cash flows providedused by financing activities were approximately $18.1$4.3 million in 2024,2025, compared to $84.7$18.1 million usedprovided by financing activities in 2023.2024. The change in net cash flows from financing activities was primarily the result of the repurchase of $36.6 million of shares of our Class A common stock during 2025 compared to none during 2024, partially offset by net proceeds relating to notes payable and our Credit Facility of $30.0$45.8 million during 2025, compared to net proceeds of $129.7$30 million in 2023 and the repurchase of $25.4 million of shares of our Class A common stock during 2023 compared to none during 2024.

Net cash flows provided by operating activities and used by financing activities in the 2025 period also included payment of $8.0 million and $5.3 million, respectively, of contingent consideration liabilities related to the acquisition of LTST. Net cash flows provided by operating activities and provided by financing activities in the 2024 period also included payment of $3.0 million and $7.0 million, respectively, of contingent consideration liabilities related to the acquisition of AAT. Net cash flows provided by operating activities and provided by financing activities in the 2023 period also included payment of $0.8 million and $9.2 million, respectively, of contingent consideration liabilities related to the acquisition of AAT.

Our cash flows may fluctuate depending on capital expenditures, future stock repurchases, dividends, strategic investments or divestitures, any indemnification calls related to the TFS settlement, and the extent of future income tax obligations and refunds.

While we attempt to identify, manage, and mitigate risks and uncertainties associated with our business, some level of risk and uncertainty will always be present. Our Form 10-K for the year ended December 31, 2025, in the section entitled "Item 1A. Risk Factors," describe some of the risks and uncertainties associated with our business. The information below supplements such risk factors. We are amending and restating in its entirety the risk factor entitled "Litigation may adversely affect our business, financial condition, and results of operations" from our Form 10-K for the year ended December 31, 2025, as set forth below. The risk factor set forth below should be read in conjunction with the risk factors included in our Form 10-K for the year ended December 31, 2025. These risks and uncertainties have the potential to materially affect our business, financial condition, results of operations, cash flows, projected results, and future prospects.

This report contains certain statements that may be considered forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. All statements, other than statements of historical or current fact, are statements that could be deemed forward-looking statements, including without limitation: any projections of earnings, revenues, or other financial items; any statement of plans, strategies, and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; and any statements of belief and any statements of assumptions underlying any of the foregoing. In this Form 10-Q, statements relating to future impact of accounting standards, future third-party transportation provider expenses, future tax rates, expenses, and deductions, expected freight demand, capacity, and volumes and trucking industry conditions, potential defaults and results of a default and testing of our fixed charge covenant under the Credit Facility or other debt agreements, expected sources, as well as adequacy, of working capital and liquidity (including our mix of debt, finance leases, and operating leases as means of financing revenue equipment), future inflation, future stock repurchases and dividends, if any, expected capital expenditures, allocations, and requirements, future customer relationships, future interest expense, future driver market conditions, including driver satisfaction, future use of independent contractors, expected cash flows, future investments in and growth of our reportable segments and services, future margins of our reportable segments, future rates and prices, future depreciation and amortization, future salaries, wages, and related expenses, including driver compensation, expected net fuel costs, strategies for managing fuel costs, the effectiveness and impact of, and cash flows relating to, our fuel surcharge programs, future fluctuations in operations and maintenance expenses, expected effects and mix of our solo and team operations, future fleet size, management, utilization, upgrades, and age, availability and usage of tractors and trailers, the market value of used equipment, the anticipated impact of our investment in TEL, the future impact of our business model, service standards, strategic plan and other strategic initiatives, changes to and deviations from our business model, strategic plan, and other strategic initiatives, claims and litigation, anticipated levels of and fluctuations relating to insurance and claims expenses, including the erosion of available limits in our aggregate insurance policies andpolicies, insurance and claims accruals, and the impact of a recent Supreme Court decision discussed in Item 1A of Part II in this Form 10-Q, contingent consideration related to our prior acquisitions, and the future impact of our prior acquisitions, among others, are forward-looking statements. Forward-looking statements may be identified by the use of terms or phrases such as "believe," "may," "could," "would," "will," "expects," "estimates," "projects," "appears," "mission," "anticipates," "plans," " outlook," "focus," "seek," "potential," "continue," "goal," "target," "objective," "optimistic," "intends," "improve," "remain," "strategy," derivations thereof, and similar terms and phrases. Such statements are based on currently available operating, financial, and competitive information. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the sections entitled "Item 1A. Risk Factors," set forth in this Form 10-Q and our Form 10-K for the year ended December 31, 2025. Readers should review and consider the factors discussed in "Item 1A. Risk Factors," set forth in this Form 10-Q and our Form 10-K for the year ended December 31, 2025, along with various disclosures in our press releases, stockholder reports, and other filings with the Securities and Exchange Commission.

Additional items of note for the firstsecond quarter of 2026 include the following:

At MarchJune 31,30, 2026, we operated 2,2342,202 tractors and 7,2657,142 trailers. Of such tractors, 2,1402,117 were owned, 1415 were financed under finance or operating leases, and 8070 tractors were provided by independent contractors, who own and drive their own tractors. Of such trailers, 6,4066,405 were owned and 859737 were held under finance or operating leases. At MarchJune 31,30, 2026, our fleet had an average tractor age of 2.2 years and an average trailer age of 5.96.1 years.

COMPARISON OF three and six months ended MarchJune 31,30, 2026 TO three and six months ended MarchJune 31,30, 2025

The increase in total revenue for the three months ended MarchJune 31,30, 2026 compared to 2025 primarily resulted from a $33.9$22.0 million, $9.0$3.9 million, and $3.5$1.1 million increase in freight revenue for Managed Freight, Dedicated, and Warehousing, respectively, partially offset by ana $8.3$9.5 million decrease in freight revenue for Expedited, as well as aan $0.9$11.9 million decreaseincrease in fuel surcharge revenue. The increase in total revenue for the six months ended June 30, 2026 compared to 2025 primarily resulted from a $55.9 million, $12.8 million, and $4.7 million increase in freight revenue for Managed Freight, Dedicated, and Warehousing, respectively, partially offset by a $17.8 million decrease in freight revenue for Expedited, as well as an $11.0 million increase in fuel surcharge revenue.

Salaries, wages, and related expenses increasedremained relatively even on a dollars basis for the three months ended MarchJune 31,30, 2026 compared to the same 2025 period and increased on a dollars basis for the six months ended June 30, 2026 compared to the same 2025 period primarily as a result of growth in our Dedicated and Warehousing reportable segments, pay increases since the prior period, and group health expenses.expenses, partially offset by a lower percentage of revenue from Expedited. As a percentage of freight revenue for the three and six months ended MarchJune 31,30, 2026, salaries, wages, and related expenses decreased as the foregoing factors increasing these expenses were offset by a lower percentage of revenue from Expedited, where we incur driver pay for team-driven tractors, and a higher percentage of revenue from Managed Freight, where we don't incur driver pay.

Total fuel expense for the three and six months ended MarchJune 31,30, 2026 remained relatively evenincreased on a dollars basis primarily due to anhigher 8.0%fuel prices partially offset by a 15.9% and 12.1% decrease in total milesmiles, offset by higher fuel pricesrespectively, compared to the 2025 period.periods. As a percentage of freight revenue for the three and six months ended MarchJune 31,30, 2026, total fuel expense decreasedincreased as the foregoing factors werepartially offset by a lower percentage of revenue from Expedited, where we incur fuel expense, and a higher percentage of revenue from Managed Freight, where we don't incur fuel expense.

The rate of fuel price changes also can have an impact on results. Most fuel surcharges are based on the average fuel price as published by the Department of Energy ("DOE") for the week prior to the shipment, meaning we typically bill customers in the current week based on the previous week's applicable index. Therefore, in times of increasing fuel prices, we do not recover as much as we are currently paying for fuel. In periods of declining prices, the opposite is true. Fuel prices as measured by the DOE were $1.34$1.43 per gallon, or 37.3%,39.6%, higher for the quarter ended MarchJune 31,30, 2026 compared with the same quarter in 2025.

We expect to continue managing our idle time and tractor speeds, investing in more fuel-efficient tractors and auxiliary power units to improve our miles per gallon, partnering with customers to adjust fuel surcharge programs that are inadequate to recover a fair portion of fuel costs, and testing the latest technologies that reduce fuel consumption. Going forward, our net fuel expense is expected to fluctuate as a percentage of revenue based on factors such as diesel fuel prices, percentage recovered from fuel surcharge programs, percentage of uncompensated miles, percentage of revenue generated by team-driven tractors (which tend to generate higher miles and lower revenue per mile, thus proportionately more fuel cost as a percentage of revenue), percentage of revenue generated from independent contractors, and the success of fuel efficiency initiatives. These fluctuations could be greater given international conflicts impacting the price of fuel.

The increase in operations and maintenance for the three and six months ended MarchJune 31,30, 2026 was primarily the result of the increased average age of tractors, high demands on equipment as we grow our fleet in niche service areas, and increased recruiting costs.

Going forward, we believe this category will fluctuate based on several factors, including the condition of the driver market and our ability to hire and retain drivers, the average age of our tractor fleet, accident severity and frequency, weather, the reliability of new and untested revenue equipment models, our mix of specialty and commoditized freight, wage and parts inflation, and any disruption of the supply chain. Additionally,Our operations and maintenance costsexpenses mayfor increasethe ifthree and six months ended June 30, 2026 were at an elevated level, which we experiencedo wagenot andexpect partsto inflation.continue going forward.

The increases in revenue equipment rentals and purchased transportation for the three and six months ended MarchJune 31,30, 2026 were primarily the result of the 2025 Star Acquisition and heightened costs associated with securing capacity within the Managed Freight reportable segment. Additionally, total miles run by independent contractors decreased from 7.1% and 7.0% for the three and six months ended MarchJune 31,30, 2025, to 6.7%6.0% and 6.4% for the same 2026 period,periods, respectively.

We expect purchased transportation to fluctuate as volumes in our Managed Freight reportable segment may be volatile. In addition, if fuel prices increase, it would result in a further increase in what we pay third-party providers and independent contractors. However, this expense category will fluctuate with the number and percentage of loads hauled by independent contractors, loads handled by Managed Freight, and tractors, trailers, and other assets financed with operating leases. In addition, factors such as the cost to obtain third party transportation services and the amount of fuel surcharge revenue passed through to the third-party providers and independent contractors will affect this expense category. IfAs industry-wide trucking capacity tightens in relation to freight demand, we mayhave needneeded to increase the amounts we pay to third-party transportation providers and independent contractors, which could increaseincreased this expense category on an absolute basis and as a percentage of freight revenue absentdue anto offsettingheightened increasecosts inoutpacing revenue.our ability to capture contractual rate increases with certain of our customers. This trend may continue if capacity tightens further and we are unable to capture contractual rate increases to cover the heightened costs. If we were to recruit more independent contractors, we would expect this line item to increase as a percentage of revenue.

On a cents per mile basis, insurance and claims decreasedincreased to 21.431.3 cents per mile and 26.3 cents per mile for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to 23.825.1 cents per mile and 24.5 for the 2025 periodperiods, respectively, primarily due to reduced insurance and claims expense partially offset by decreased miles compared to the same 2025 period.periods and increased settlements in the three months ended June 30, 2026, partially offset by reduced insurance and claims expense during the six months ended June 30, 2026. Miles decreased primarily due to reducing our Expedited fleet as well as weather duringin the 2026 period.2026.

Our insurance program includes multi-year policies with specific insurance limits that may be eroded over the course of the policy term. If that occurs, we will be operating with less liability insurance coverage at various levels of our insurance tower and may incur additional premiums. For the policy period that ran from April 1, 2018 to March 31, 2021, the aggregate limits available in the coverage layer $9.0 million in excess of $1.0 million were fully eroded based on claims expense. We replaced our $9.0 million in excess of $1.0 million layer with a new $7.0 million in excess of $3.0 million policy that we continue to maintain. Due to the erosion of the $9.0 million in excess of $1.0 million layer, any adverse developments in claims filed between April 1, 2018 and March 31, 2021, could result in additional expense accruals. As of MarchJune 31,30, 2026, there were no outstanding claims in this layer. We have maintained our retention and limits set in place during the prior renewal cycle. Due to these developments, we may experience additional expense accruals, increased insurance and claims expenses, and greater volatility in our insurance and claims expenses, which could have a materially adverse effect on our business, results of operations, financial condition, or liquidity.

We expect insurance and claims expense to continue to be volatile over the long-term. The May 2026 United States Supreme Court decision that the Federal Aviation Administration Authorization Act does not preempt state law liability claims against freight brokers could lead to additional volatility in our insurance and claims expense, as discussed in Item 1A of Part II in this Form 10-Q. To the extent damages awarded against us for any claims exceed our coverage limits, involve significant aggregate use of our self-insured retention amounts, are uninsured, or cause increases in our insurance premiums, our insurance and claims expense would be volatile and increase. Any resulting increases in such expenses could have a materially adverse effect on our business, results of operations, financial condition, or liquidity. For additional details regarding our claims accruals, see Note 9, "Commitments and Contingencies" of the accompanying condensed consolidated financial statements.

For the three and six months ended MarchJune 31,30, 2026, general supplies and expenses increased on a dollars basisdecreased as a result of increasedthe technology$0.7 costsmillion partially offset by theand $0.3 million increasedecreases in the fair value of the contingent consideration recognized during the 2026 periodperiods, respectively, compared to an increaseincreases of $0.7 and $1.4 million recognized during the same 2025 period.periods, partially offset by increased technology costs during the 2026 periods.

Depreciation expense increaseddecreased $1.6$0.6 million to $21.0$19.8 million for the three months ended MarchJune 31,30, 2026 and increased $1.0 million to $40.8 million for the six months ended June 30, 2026, compared to $19.4$20.3 million and $39.8 million in the same 2025 period.periods. Amortization of intangible assets was $3.0 million and $6.0 million for the three and six months ended MarchJune 31,30, 2026 compared to $2.4$2.8 million and $5.1 million for the same 2025 period.periods. The increase for the three and six months ended MarchJune 31,30, 2026 is due to the amortization of the intangible asset related to the Star Acquisition.

We expect depreciation and amortization to increase on a per unit basis going forward as the cost of new equipment increases. Additionally, changes in the used tractor market have caused us to adjust residual values and increase depreciation, and further adjustments may be necessary in the future. These changes may also cause us to hold assets longer than planned, or experience increased losses on sale. If we were to grow our Expedited or Dedicated reportable segments we may face additional increases in depreciation and amortization.

For the periodperiods presented, the change in loss on disposition of property and equipment, net was insignificant both as a percentage of total revenue and freight revenue.

For the periodperiods presented, the change in interest expense, net was insignificant both as a percentage of total revenue and freight revenue.

We have accounted for our investment in TEL using the equity method of accounting and thus our financial results include our proportionate share of TEL's net income or loss. The change in TEL's contribution to our results for the three and six months ended MarchJune 31,30, 2026 was insignificant for the periods presented. For the remainder of 2026, we expect TEL's earnings to remain relatively similar to those of the current period. However, due to TEL's business model, gains and losses on sale of equipment is a normal part of the business and can cause earnings to fluctuate from period to period and therefore our income from investment to similarly fluctuate.

The decreasedecreases in income tax expense for the three and six months ended MarchJune 31,30, 2026 waswere the result of a $2.5$2.2 million and $4.7 million decrease in pre-tax incomeincome, respectively, compared to the same 2025 period.periods. The changes in pre-tax income resulted from the aforementioned changes in operating income.

COMPARISON OF three and six months ended MarchJune 31,30, 2026 TO three and six months ended MarchJune 31,30, 2025

The decrease in Expedited revenue for the three months ended MarchJune 31,30, 2026 relates to a 10.4%decrease decreaseof 17.0% in average total tractors compared to the 2025 quarter andpartially offset by a $1.7$5.6 million decreaseincrease in fuel surcharge revenue. Average freight revenue per tractor per week wasincreased comparable to the 2025 quarter as6.8% a result of a 3.4% decrease in average miles per unit largely offset by a 7.025.0 cents per mile (or 3.3%11.8%) increase in average rate per total mile aspartially offset by a 4.2% decrease in average miles per unit compared to the 2025 quarter. Expedited team-driven tractors averaged 709659 and 796806 tractors in the firstsecond quarter of 2026 and 2025, respectively.

The increase in Dedicated revenue forFor the threesix months ended MarchJune 31,30, 2026 the decrease in Expedited revenue relates to a 31,decrease orof 2.1%,13.8% in average tractortotal increasetractors andcompared anto the 2025 period partially offset by a $3.9 million increase in averagefuel surcharge revenue. Average freight revenue per tractor per week ofincreased 8.7%3.3% compared to the 2025 quarter.period Theas increase in average freight revenue per tractor per week was thea result of a 35.016.0 cents per mile (or 11.3%7.5%) increase in average rate per total mile partially offset by a 2.3%3.8% decrease in average miles per unit as compared to the 2025 quarter.period. Expedited team-driven tractors averaged 683 and 801 tractors in the six months ended June 30, 2026 and 2025, respectively.

For the three and six months ended MarchJune 31,30, 2026, Managed Freight total revenue increased compared to the 2025 periods primarily as a result of the fourth quarter 2025 Star Acquisition.Acquisition, with the second quarter of 2026 total revenue partially offset by the benefit of a surge contract during the second quarter of 2025 that was later discontinued.

For the three and six months ended MarchJune 31,30, 2026, Warehousing total revenue increased $3.5$1.1 million and $4.7 million compared to the 2025 periodperiods primarily due to onboarding a significant customer in the fourth quarter of 2025.

The decreaseincrease in Expedited segment operating income for the three months ended MarchJune 31,30, 2026 was primarily the result of a decrease in Expedited segment operating expenses partially offset by the aforementioned decrease in revenue. For the six months ended June 30, 2026 the decrease in Expedited segment operating income was primarily the result of the aforementioned decrease in revenue, partially offset by a decrease in Expedited segment operating expenses. The decrease in Expedited segment operating expenses for the three and six months ended MarchJune 31,30, 2026 was primarily the result of decreases in salaries, wages, and benefits for our professional drivers, operations and maintenance, and purchased transportation as compared to the same 2025 periodperiods as a result of fewer average miles per unit and a decrease in the average number of Expedited team-driven tractors. Going forward, our focus in Expedited will be on improving margins through rate increases, exiting less profitable business, and adding more profitable business.

The increase in Dedicated segment operating income for the three and six months ended MarchJune 31,30, 2026 was primarily the result of aforementioned increase in revenue, partially offset by an increase in Dedicated segment operating expenses. The increase in Dedicated segment operating expenses for the three and six months ended MarchJune 31,30, 2026, was primarily the result of increased salaries, wages, and benefits for our professional drivers, fuel expenses, and operations and maintenance costs since the 2025 periodperiods as a result of productivity from our agricultural protein related fleet which was negatively impacted by avian influenza during the prior year period.periods as well as exiting non-specialized dedicated business that was below our preferred profitability thresholds. Going forward, we remain focused on our strategy of growing our dedicated fleet, specifically in areas that provide value-added services for customers. We believe that if we are successful in providing best in class service and controlling our costs, growth and improved profitability will result.

The increasedecrease in segment operating income for Managed Freight for the three and six months ended MarchJune 31,30, 2026 was primarily the result of the aforementioned increase in Managed Freight revenue partially offset by an increase in Managed Freight segment operating expenses.expenses partially offset by the aforementioned increase in Managed Freight revenue. The increase in Managed Freight segment operating expenses for the three and six months ended MarchJune 31,30, 2026 was primarily the result of the increases in revenue driving increases in variable expenses, primarily purchased transportation.transportation as well as heightened costs associated with securing capacity currently outpacing our ability to capture contractual rate increases with certain of our customers. Going forward, we seek to grow Managed Freight with profitable revenue from new customers from organic initiatives and the Star Acquisition, working closely with our asset-based segments to capitalize on overflow opportunities when available, and optimizing costs to yield longer-term margin goals in the mid-single digits, which would generate an acceptable return on capital given the asset light nature of the business.

The decrease in segment operating income for Warehousing for the three and six months ended MarchJune 31,30, 2026 is primarily due to startup-related costs and inefficiencies for a significant customer onboarded during the fourth quarter of 2025 that more than offset the aforementioned increase in revenue. Going forward, as activities within this startup normalize, our goal is to have operating income margins in the high-single digit range.range through a combination of rate increases and cost reductions.

Our business requires significant capital investments over the short-term and the long-term. Historically, we have financed our capital requirements with borrowings under our Credit Facility, cash flows from operations, long-term operating leases, finance leases, secured installment notes with finance companies, and proceeds from the sale of our used revenue equipment. Going forward, we expect revenue equipment acquisitions to primarily be through purchases and finance leases. Further, we expect to increase our capital allocation toward our Dedicated, Managed Freight, and Warehousing reportable segments to become the go-to partner for our customers’ most critical transportation and logistics needs. We had working capital (total current assets less total current liabilities) of $9.0$26.6 million and $22.8 million at MarchJune 31,30, 2026 and December 31, 2025, respectively. Our working capital on any particular day can vary significantly due to the timing of collections and cash disbursements. Based on our expected financial condition, net capital expenditures, results of operations, related net cash flows, installment notes, and other sources of financing, we believe our working capital and sources of liquidity will be adequate to meet our current and projected needs, and we do not expect to experience material liquidity constraints in the foreseeable future.

With an average tractor fleet age of 2.2 years at MarchJune 31,30, 2026, we believe we have flexibility to manage our fleet, and we plan to regularly evaluate our tractor replacement cycle, new tractor purchase requirements, and purchase options. If we were to grow our independent contractor fleet, our capital requirements would be reduced.

As of MarchJune 31,30, 2026 and December 31, 2025 we had $291.8$324.4 million and $338.7 million in debt and lease obligations, respectively, consisting of the following:

As of MarchJune 31,30, 2026, we had $29.0$51.0 million borrowings outstanding, undrawn letters of credit outstanding of approximately $19.9 million, and available borrowing capacity of $57.5$59.1 million under the Credit Facility. Fluctuations in the outstanding balance and related availability under our Credit Facility are driven primarily by cash flows from operations and the nature and timing of property and equipment additions that are not funded through notes payable, as well as the nature and timing of collection of accounts receivable, payments of accrued expenses, and receipt of proceeds from disposals of property and equipment.

Our net capital expenditures for the threesix months ended MarchJune 31,30, 2026 totaled $24.2$0.2 million of proceeds,expenditures, as compared to $23.9$52.8 million of expenditures for the threesix months ended MarchJune 31,30, 2025. During the threesix months ended MarchJune 31,30, 2026, we took delivery of approximately 53181 new tractors and 15116 new trailers, while disposing of approximately 422573 used tractors and 29113 used trailers. Net losses on disposal of equipment and real estate in the threesix months ended MarchJune 31,30, 2026 and 2025 were $0.3$0.6 million,million respectively.for each period. Our current fleet plan for the remainderbalance of 2026 ranges from $40.0$50.0 million to $50.0$60.0 million, which is a significant reduction compared to 2025. Our expected capital expenditures are subject to change based on growth opportunities in our Dedicated fleet and the potential impacts of tariffs during the year. Our equipment plan reflects our priorities of maintaining the average age of our fleet in a manner that allows us to optimize operational uptime and related operating costs and offer a fleet of equipment that our professional drivers are proud to operate. We expect the benefits of improved utilization, fuel economy and maintenance costs to produce acceptable returns despite increased prices of new equipment and potentially lower values of used equipment. Given the mix change between our high mileage Expedited fleet and lower mileage Dedicated fleets, going forward, we anticipate the average age of our equipment to range from 25 to 28 months.

We distributed a total of $1.8$3.5 million to stockholders in the first threesix months of 2026 through dividends.

Net cash flows provided by operating activities increaseddecreased to $29.0$18.1 million for the threesix months ended MarchJune 31,30, 2026, compared to $24.8$46.7 million for the same 2025 period. Changes in operating assets and liabilities providedused $2.1$35.5 million and $1.7$7.7 million during the threesix months ended MarchJune 31,30, 2026 and 2025, respectively, whileand net income decreased to $13.0 million for the six months ended June 30, 2026, compared to $16.4 million for the same 2025 period. These increases in cash used during the 2026 period were partially offset by higher non-cash expenses such as deferred income tax expense and depreciation and amortization increased during the 2026 period. These increases were partially offset by a decrease in net income to $4.4 million for the three months ended March 31, 2026, compared to $6.6 million for the same 2025 period.amortization.

Net cash flows providedused by investing activities were $24.2$0.8 million for the threesix months ended MarchJune 31,30, 2026, compared to $24.1$53.5 million used in the same 2025 period. The increasedecrease in net cash flows providedused by investing activities was primarily due to disposing of a large amount of unproductive used revenue equipment and buying very little new equipment, whereby we took delivery of approximately 53181 new tractors and 15116 new trailers, while disposing of approximately 422573 used tractors and 29113 used trailers during the 2026 period compared to delivery of 163385 new tractors and 201425 new trailers, while disposing of approximately 100193 used tractors and 76242 used trailers in the same 2025 period.

Net cash flows used by financing activities were $46.9$19.7 million for the threesix months ended MarchJune 31,30, 2026, compared to $25.1$28.7 million providedused in the same 2025 period. The increasedecrease in net cash flows used inby financing activities was primarily aattributable functionto the absence of common stock repurchases during the 2026 period compared to $35.6 million of net common stock repurchases (inclusive of excise tax) in the 2025 period. This decrease in net cash usage was partially offset by net repayments relating to our notes payable and our Credit Facility of $44.5$9.0 million in the 2026 period compared to net repaymentsborrowings of $18.4$14.0 million in the 2025 period.

Net cash flows provided by operating activities also included paymentcontingent ofconsideration $8.0 million for the 2025 periodpayments related to the LTST acquisition of LTST$8.3 million and net$8.0 million during the 2026 and 2025 periods, respectively. Net cash flows used by financing activities in the 2026 and 2025 periods also included payment of contingent consideration liabilitiespayments $0.3of $4.2 million related to the LTST acquisition and $0.6 million related to the Asset Acquisition andduring 2026, compared to contingent consideration payments of $4.5 million related to the LTST acquisition ofduring LTST.2025.

On April 23, 2025, the Board approved a stock repurchase program authorizing the purchase of up to $50 million of the Company's Class A common stock from time-to-time based upon market conditions and other factors. The stock may be repurchased on the open market, in privately negotiated transactions, or other legally permissible means, including pursuant to Rule 10b5-1 trading plans. The Company did not place a limit on the duration of the repurchase program. The stock repurchase program does not obligate the Company to repurchase any specific number of shares, and the Company may suspend or terminate the program at any time without prior notice. There were no shares repurchased during threesix months ended MarchJune 31,30, 2026 or 2025. During the year ended December 31 2025, we repurchasedand approximately 1.6 million shares of our Classclass A common stock for $36.2$35.2 million (excluding excise tax). repurchased during the six months ended June 30, 2025 and the year ended December 31 2025.

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires us to make decisions based upon estimates, assumptions, and factors we consider as relevant to the circumstances. Such decisions include the selection of applicable accounting principles and the use of judgment in their application, the results of which impact reported amounts and disclosures. Changes in future economic conditions or other business circumstances may affect the outcomes of our estimates and assumptions. Accordingly, actual results could differ from those anticipated. There have been no material changes to our most critical accounting policies and estimates during the three and six months ended MarchJune 31,30, 2026, compared to those disclosed in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," included in our Form 10-K for the year ended December 31, 2025.