1、Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31,2021orTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXC
2、HANGE ACT OF 1934For the transition period from toCommission File Number:001-38528U.S.Xpress Enterprises,Inc.(Exact name of registrant as specified in its charter)Nevada62-1378182(State/other jurisdiction of incorporation or(I.R.S.Employer Identification No.)organization)4080 Jenkins RoadChattanooga
3、,Tennessee37421(Address of principal executive offices)(Zip Code)(423)510-3000(Registrants telephone number,including area code)Securities registered pursuant to Section 12(b)of the Act:Class A Common Stock,$0.01 par value per shareUSXThe New York Stock Exchange(Title of each class)(Trading Symbol)(
4、Name of each exchange on which registered)Securities registered pursuant to Section 12(g)of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes NoIndicate by check mark if the registrant is not required to file reports
5、 pursuant to Section 13 or 15(d)of the Act.Yes NoIndicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of1934 during the preceding 12 months(or for such shorter period that the registrant was required to file s
6、uch reports),and(2)has been subject to suchfiling requirements for the past 90 days.Yes NoIndicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405of Regulation S-T(232.405 of this chapter)during the preceding
7、 12 months(or for such shorter period that the registrant was required to submitsuch files).Yes NoIndicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,oremerging growth company.See the definitions of large
8、 accelerated filer,accelerated filer,smaller reporting company,and emerging growthcompany in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the re
9、gistrant has elected not to use the extending transition period for complying with anynew or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment
10、of the effectiveness of its internalcontrol over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm thatprepared or issued its audit report.Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-
11、2 of the Exchange Act).Yes NoThe aggregate market value of the common equity held by non-affiliates of the registrant as of June 30,2021,the last business day of the registrantsmost recently completed second fiscal quarter,was approximately$280.9 million(based upon the$8.60 per share closing price o
12、n that date asreported by The New York Stock Exchange).In making this calculation the registrant has assumed,without admitting for any purpose,that allexecutive officers,directors,and affiliated holders of more than 10%of a class of outstanding common stock,including through groups,and no otherperso
13、ns,are affiliates.As of February 18,2022,the registrant had 35,001,769 shares of Class A common stock and 15,657,089 shares of Class B common stockoutstanding.DOCUMENTS INCORPORATED BY REFERENCEPortions of the materials from the registrants definitive proxy statement for the 2022 Annual Meeting of S
14、tockholders to be held on May25,2022,have been incorporated by reference into Part III of this Form 10-K.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm1/155Table of Content
15、sTable of ContentsPart IItem 1.Business4Item 1A.Risk Factors18Item 1B.Unresolved Staff Comments33Item 2.Properties33Item 3.Legal Proceedings33Item 4.Mine Safety Disclosures33Part IIItem 5.Market for Registrants Common Equity,Related Stockholder Matters and IssuerPurchases of Equity Securities33Item
16、6.Reserved34Item 7.Managements Discussion and Analysis of Financial Condition and Results ofOperations35Item 7A Quantitative and Qualitative Disclosures about Market Risk50Item 8.Financial Statements and Supplementary Data50Item 9.Changes in and Disagreements with Accountants on Accounting and Finan
17、cialDisclosure81Item 9A.Controls and Procedures81Item 9B.Other Information83Item 9CDisclosure Regarding Foreign Jurisdictions that Prevent Inspections83Part IIIItem 10.Directors,Executive Officers,and Corporate Governance83Item 11.Executive Compensation83Item 12.Security Ownership of Certain Benefic
18、ial Owners and Management and RelatedStockholder Matters83Item 13.Certain Relationships and Related Transactions,and Director Independence84Item 14.Principal Accounting Fees and Services84Part IVItem 15.Exhibits and Financial Statement Schedules85Item 16.Form 10-K Summary88SignaturesReport of Indepe
19、ndent Registered Public Accounting Firm51Financial DataConsolidated Balance Sheets54Consolidated Statements of Comprehensive Income(Loss)55Consolidated Statements of Stockholders Equity56Consolidated Statements of Cash Flows57Notes to Consolidated Financial Statements582025/1/18 08:34sec.gov/Archive
20、s/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm2/155Table of ContentsPART ICautionary Note Regarding Forward-looking StatementsThis Annual Report on Form 10-K(this“Annual Report”)contains certain stateme
21、nts that may beconsidered forward-looking statements within the meaning of Section 21E of the Securities ExchangeAct of 1934,as amended(the“Exchange Act”),and Section 27A of the Securities Act of 1933,asamended(the“Securities Act”)and such statements are subject to the safe harbor created by thosese
22、ctions and the Private Securities Litigation Reform Act of 1995,as amended.All statements,otherthan statements of historical or current fact,are statements that could be deemed forward-lookingstatements,including without limitation:any projections of earnings,revenues or other financial items;any st
23、atement of plans,strategies,outlook,growth prospects or objectives of management for futureoperations;our operational and financial targets;general economic trends,performance or conditionsand trends in the industry and markets;the competitive environment in which we operate;anystatements concerning
24、 proposed new services,technologies or developments;and any statement ofbelief and any statements of assumptions underlying any of the foregoing.In this Annual Report,statements relating to the impact of new accounting standards,future tax rates,expenses,anddeductions,expected freight demand,capacit
25、y,and volumes,potential results of a default under ourCredit Facility or other debt agreements,expected sources of working capital and liquidity(includingour mix of debt,finance leases,and operating leases as means of financing revenue equipment),as wellas the adequacy of working capital and liquidi
26、ty,expected capital expenditures,expected fleet age andmix of owned versus leased equipment,expected impact of technology,including our strategicinitiatives,our ability to profitably scale and achieve operational efficiencies in Variant,as well as ourBrokerage segment,future performance of our Dedic
27、ated division,including pricing and margins,future customer relationships,future utilization of independent contractors,future fluctuations inpurchased transportation expense and fuel surcharge reimbursement,future driver market conditionsand driver turnover and retention rates,any projections of ea
28、rnings,revenues,cash flows,dividends,capital expenditures,operating ratio,margins,or other financial items,expected cash flows,expectedoperating improvements,any statements regarding future economic conditions or performance,anystatement of plans,strategies,programs and objectives of management for
29、future operations,includingthe anticipated impact of such plans,strategies,programs and objectives,future rates and prices,futureutilization,future depreciation and amortization,future salaries,wages,and related expenses,includingdriver compensation,future insurance and claims expense,future fluctua
30、tions in fuel costs and fuelsurcharge revenue,including the future effectiveness of our fuel surcharge program,strategies formanaging fuel costs,political conditions,legislation,and regulations,future fleet size and management,including allocation of trucks among Variant,Dedicated and legacy Over-th
31、e-Road,future shortagesand pricing of new revenue equipment,any statements concerning proposed acquisition plans,newservices or developments,the anticipated impact of legal proceedings on our financial position andresults of operations,the future impact and the anticipated effect of the COVID-19 pan
32、demic and anyrelated vaccination mandates on our business and results of operations,among others,are forward-looking statements.Such statements may be identified by their use of terms or phrases such as“believe,”“may,”“could,”“should,”“expects,”“estimates,”“projects,”“anticipates,”“plans,”“intends,”
33、“outlook,”“strategy,”“target,”“optimistic,”“focus,”“seek,”“potential,”“goal,”“continue,”“will,”derivations thereof,and similar terms and phrases.Such statements are based oncurrently available operating,financial and competitive information.Forward-looking statements areinherently subject to risks a
34、nd uncertainties,some of which cannot be predicted or quantified,whichcould 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 suchdifferences include,but are not l
35、imited to,those discussed in the section entitled“Item 1A.RiskFactors,”set forth below.Readers should review and consider the factors discussed in“Item 1A.RiskFactors,”along with various disclosures in our press releases,stockholder reports,and other filingswith the Securities and Exchange Commissio
36、n(“SEC”).All such forward-looking statements speak only as of the date of this Annual Report.You are cautionednot to place undue reliance on such forward-looking statements.We expressly disclaim any obligationor undertaking to release publicly any updates or revisions to any forward-looking statemen
37、ts containedherein to reflect any change in our expectations with regard thereto or any change in the events,conditions,or circumstances on which any such statement is based.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/dat
38、a/923571/000155837022002527/usx-20211231x10k.htm3/155Page 3References in this Annual Report to“we,”“us,”“our,”or the“Company”or similar terms referto U.S.Xpress Enterprises,Inc.,and its subsidiaries.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.s
39、ec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm4/155Table of ContentsPage 4ITEM 1.BUSINESSOur BusinessWe are one of the largest asset-based truckload carriers in the United States by revenue,generating over$1.9 billion in total operating revenue in 2021.We provide services
40、primarily throughout the UnitedStates,with a focus in the densely populated and economically diverse eastern half of the United States.We offer customers a broad portfolio of services using our own truckload fleet and third-party carriersthrough our non-asset-based truck brokerage network.As of Dece
41、mber 31,2021,our fleet consisted ofapproximately 6,400 tractors and approximately 13,600 trailers,including approximately 1,200 tractorsprovided by independent contractors.Our terminal network is established and capable of handlingsignificantly larger volumes without meaningful additional investment
42、.For much of our history,we focused primarily on scaling our fleet and expanding our service offeringsto support sustainable,multi-faceted relationships with customers.More recently,we have focused onour core service offerings and refined our network to focus on shorter,more profitable lanes with mo
43、redensity,which we believe are more attractive to drivers.We believe we have the strategy,managementteam,revenue base,modern fleet,and capital structure that position us very well to execute upon ourinitiatives,drive further operational gains,and deliver long term value for our stockholders.We are c
44、urrently focused on three main priorities.The first is optimizing our Truckload network andresulting average revenue per tractor per week through repositioning equipment and allocating capacityto our Dedicated service offering and Variant,our digital fleet,from certain portions of our Over-the-Road(
45、“OTR”)service offering.The second is improving the experience of our professional truckdrivers,including their safety and security.The third is advancing our technology initiatives centered ondigitization of our loads and business,automated load acceptance and prioritization.During 2021,wecontinued
46、to see tangible,financial benefits of our strategic initiatives focused on utilizing technology toimprove our processes,accelerate the velocity of our business,reduce the number of our preventableaccidents,improve our customers and drivers satisfaction,and lower our costs.We intend to continue succe
47、ssfully developing and implementing these digital initiatives that we believeare re-engineering our Company to be a market leader in growth and profitability over the next decade.We believe the result of these initiatives will provide for a more scalable model with significantly lowercosts.Our Servi
48、ce OfferingsWe organize our service offerings into two reportable segments,Truckload and Brokerage.TheTruckload segment offers asset-based truckload services,including the OTR and dedicated contractservices described below.Our Brokerage segment is principally engaged in non-asset-based freightbroker
49、age services.We believe many customers seek truckload operators that offer both asset-based andnon-asset-based services to help ensure capacity will be available as needed.We believe that each of ourservice offerings,on a stand-alone revenue basis,would represent one of the largest participants in i
50、tsrespective market.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm5/155Table of ContentsBelow is a brief overview of our service offerings:Approximate%of 2021Revenue(1)Desc
51、riptionOTR 43%Transports a full trailer of freight for a singlecustomer from origin to destination,typicallywithout intermediate stops or handling Includes our Variant fleet Short-term contracts and spot moves thatinclude irregular route moves withoutvolume and capacity commitments Tractors are oper
52、ated with one driver or ateam of two drivers to handle more time-sensitive,higher margin freight Routes are generally between 450 and 1,050miles in length Fuel surcharge programs help us offset mostof the negative impact of rising fuel pricesassociated with loaded or billed milesDedicatedContract32%
53、Contractually assigned equipment,driversand on-site personnel to address customersneeds for committed capacity and servicelevels Multi-year initial contract term withguaranteed volumes and pricing We have renewed substantially all of ourdedicated contracts after the initial contractterm Fuel costs a
54、re typically more predictable andless volatile under the fixed and variablepricing of these contracts Historically,our dedicated contract customersgenerally adjust pricing to account for driverwage increases,although these adjustmentsmay not be contractually requiredBrokerage23%Non-asset-based freig
55、ht brokerage servicethrough which loads are contracted to third-party carriers Allocation strategy designed to maximizeprofitability of our Truckload fleet beforeoutsourcing loads to third-party carriers In the past 12 months,we have utilized thecapacity of approximately 24,000 third-partycarriers(1
56、)Based on revenue,before fuel surcharge.Approximately 2%of revenue is attributable to otherancillary services.We primarily operate in the eastern half of the United States.We also have business to and from Mexicovia a more variable cost model using third party carriers.The revenue from such model is
57、 generated inthe United States.During 2021 and 2020,all of our operating revenue was generated in the UnitedStates.Customer RelationshipsWe maintain a diverse,long-standing customer base that includes many Fortune 500 companies,including Dollar General,Dollar Tree,FedEx,Home Depot,Kroger,Procter&Gam
58、ble,Target,TractorTruckload(75%)2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm6/155Page 5Supply and Walmart.Our customers fall within a broad spectrum of geographies and en
59、d markets,including retail,food and beverage,e-commerce and packages,manufacturing,consumer products andthird-party logistics.No other category comprised more than five percent of the end markets we servedat December 31,2021.Relationships with our top ten customers exceed ten years on average.For202
60、5/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm7/155Table of Contentsthe year ended December 31,2021,our largest customer accounted for approximately 11%of ourrevenue,excluding
61、 fuel surcharge.Tractor and Trailer FleetsWe operate a modern fleet of approximately 5,200 company-owned tractors and approximately 13,600trailers,and we also contract for additional tractor capacity through approximately 1,200 independentcontractors,who provide both the tractor and a driver and,exc
62、ept for the trailer,which we generallyprovide,bear the operating expenses of each load.Our company tractor fleet continues to include themost advanced technology in todays market including electronic logging devices(“ELDs”),electronicspeed limiters,electronic roll stability,improved aerodynamics and
63、 fuel efficiency technologies,enhanced tractor connectivity with remote updating capabilities,improved automatic transmissions,lanedeparture and collision warning/avoidance systems,upgraded braking systems and event recorders.Each of our company tractors is also equipped with onboard communication u
64、nits that offer real timefreight positioning to our customers and instant communication between our drivers and us.Tractors and trailers represent our most substantial capital investments.In general,we expect to operatea tractor for approximately 475,000 to 575,000 miles,which when averaged across o
65、ur fleet as ofDecember 31,2021 equates to approximately 4.5 years of operation and a trailer for up to 10 years ormore of operation.We depreciate or finance our equipment over their useful lives and down to salvagevalues that we expect to represent fair market value at the expected time of sale.Our
66、ongoing capitalexpenditures are significant,and our annual depreciation expense is expected to be approximately equalto maintenance capital expenditures,net of proceeds of dispositions,assuming a constant percentage ofleased versus owned equipment and a constant trade cycle.In practice,we vary our t
67、rade cycle andfinancing based on the market for new and used tractors,the quality,dependability and cost per mile tooperate the equipment,our capital budget,expected tax benefits and other factors.Based on the volumeswe purchase,we believe that we have a cost advantage in the procurement of new trac
68、tors and trailerscompared to the prices paid by small trucking companies.Our company tractors had an average age of approximately 1.7 years at December 31,2021.Our Competitive StrengthsWe believe the following competitive strengths provide us with a strong foundation to continue toimprove our profit
69、ability and stockholder value:Industry leading truckload operator with significant scaleWe are one of the largest asset-based truckload carriers in the United States in 2021 by total operatingrevenue and we believe our large scale provides us with significant benefits.These benefits includeeconomies
70、 of scale on major expenditures such as tractors,trailers and fuel,as well as our overallinfrastructure.Additionally,we can offer an enhanced value proposition for large customers who seekefficiency in sourcing capacity from a limited number of carriers and flexible capacity to accommodateseasonal s
71、urge volumes.Our established and well-maintained terminal network is capable of handlingmeaningfully larger volumes without meaningful additional investment.Complementary mix of services to afford flexibility and stability throughout economic cyclesOur service offerings have unique characteristics a
72、nd are subject to differing market forces,which webelieve allows us to respond effectively through economic cycles.OTROTR business involves short-term customer contracts without pricing or volume guarantees that allowus to benefit from periods of supply and demand imbalance and price volatility.This
73、 is the largest partof our business and the overall truckload market.Dedicated2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm8/155Page 6Dedicated business features committed
74、 rates,lanes and volumes under contracts that generally afford usgreater revenue predictability over the contract period and help smooth the impact of market cycles.Additionally,our dedicated contract2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.
75、sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm9/155Table of Contentsservice offering generally has higher driver retention rates than our OTR service offering,which webelieve is because our professional drivers prefer the more predictable time at home that dedicatedroutes
76、 offer.In addition,this increased visibility allows us to commit and invest fleet resources with amore predictable return profile.We intend to grow this portion of our business as a percentage of ouraverage tractors.BrokerageBrokerage capacity allows us to aggregate volume and to flex the amount all
77、ocated to our own fleetwith freight cycles.Typically,we allocate more loads to our OTR fleet during slow freight demand tokeep our assets productive,and more loads to third-party carriers during higher freight demand tomaintain control over customer freight and make a margin on outsourcing the moves
78、.By retainingcontrol over significantly more freight than we are able to serve with our own assets,and allocating theavailable loads first to our own tractors,we have more choices for optimizing the utilization and pricingof our fleet every day and throughout market cycles.TechnologyWe are focused o
79、n continual development and implementation of the digital initiatives that we believeare re-engineering our company to be a market leader in growth and profitability over the next decade.Within our Truckload reportable segment,Variant represents an entirely new paradigm for operatingtrucks in an Ove
80、r-the-Road environment utilizing artificial intelligence and digital platforms to recruit,plan,dispatch and manage its fleet.The divisions operating model,powered by cutting edgetechnology,has generated improvement in utilization while significantly reducing driver turnover,andpreventable accidents
81、per million miles,all as compared to our legacy OTR fleet.During the secondhalf of 2021,Variants turnover,utilization,and revenue per tractor per week began to deteriorate andthose trends accelerated in the fourth quarter.In December 2021,the Variant team began to transition itsfocus from idea gener
82、ation to execution and scale the product that was developed.Since December2021,the operational changes that we have made have translated to improvements in utilization,revenue per truck and overhead per truck.During 2020,we purchased a small business with a technology platform and an experienced and
83、talented team.Their approach to the brokerage business is to utilize a digital framework for handlingtransactions which we expect to be scalable.Importantly,we believe this platform will enable our teamto continue scaling the business and drive a high level of growth in the years to come.Our teampro
84、cessed 76.7%of our Brokerage transactions digitally in 2021.As we drive more volume over ourdigital platform,we believe our Brokerage segment will become much more scalable and allow us toprofitably drive growth as we look to the years ahead.Long-standing,diverse and resilient customer baseWe mainta
85、in a long-standing customer base that includes many Fortune 500 companies with nationalfootprints,including Dollar General,Dollar Tree,FedEx,Home Depot,Kroger,Procter&Gamble,Target,Tractor Supply and Walmart.As of December 31,2021,relationships with our top ten customersexceeded ten years on average
86、.Our portfolio of blue-chip customers allows us to benefit from the lesscyclical and more-stable demand from grocery and dollar stores in addition to increasing demand due tosecular growth trends in end-markets such as e-commerce.We also benefit from significant cross-selling opportunities among lar
87、ge key customers,as all of our top ten customers use at least two of ourthree service offerings,which allows us to have multiple points of contact with our customers and takeadvantage of varying bid cycles.Modern fleet and maintenance system designed to optimize life cycle investment and minimizeope
88、rating costsOur fleet represents our largest capital investment,a visible representation of our brand for customersand drivers and a large portion of our controllable costs.We select,maintain and dispose of our fleetbased on rigorous analysis of our investments and operating costs.Our modern and wel
89、l-maintained fleet consisted of approximately 5,200 company tractors with anaverage age of approximately 1.7 years and approximately 13,600 trailers at December 31,2021.We2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/9
90、23571/000155837022002527/usx-20211231x10k.htm10/155Page 7also contracted for approximately 1,200 tractors provided by independent contractors at December 31,2021.We equip our tractors with carefully selected components based on initial cost,maintenancerequirements,warranty coverage,safety and effici
91、ency advantages,driver preference and resale value.Our company tractor fleet is technologically advanced and equipped with safety and efficiency features,including using electronic logs since 2012,electronic speed limiters,automatic transmissions,lanedeparture and2025/1/18 08:34sec.gov/Archives/edga
92、r/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm11/155Table of Contentscollision warning systems,air disc brakes and high performance wide brake drums,electronic rollstability and event recorders.Over the past
93、several years,we have developed a disciplined and effective in-house maintenanceprogram designed to actively manage these assets based on customized timetables for preventivemaintenance and replacement of parts.We believe this approach,coupled with our in-housemaintenance facilities and in-house tec
94、hnicians dedicated to fleet maintenance,helps us effectivelymanage our maintenance cost per mile,keeps drivers on the road efficiently and creates an attractiveasset and record for resale.Motivated management team focused on tactical execution and leadership in the truckload marketOur management and
95、 operations team has been carefully assembled to obtain a mix of industry veteransfrom successful competitors and high-performing internal candidates,all of whom are motivated toperform in our transparent,metric-driven environment.Our President and Chief Executive Officer,EricFuller,has over 20 year
96、s of experience at U.S.Xpress and has been responsible for developing the teamand spearheading our transformation program over the last several years.Our management teamscompensation and ownership of our common stock provide further incentive to improve businessperformance and profitability.In addit
97、ion,with active positions in industry associations,such as theAmerican Trucking Associations,Inc.(“ATA”),our management team provides us with a key role in thediscussions that we believe are shaping the future of the industry.We believe our leadership team iswell-positioned to execute our strategy a
98、nd remains a key driver of our financial and operationalsuccess.Our StrategiesWe believe we possess the scale,infrastructure and service offerings to compete effectively in ourmarkets,our opportunity for further improvement is significant,and our strategies are designed toenhance stockholder value.I
99、mprove profitability and grow revenueImprove asset productivity by using advanced technology to optimize dispatch miles in allcycles and actively upgrade freight mix when volumes permitControl non-essential costs and seek efficiencies throughout the enterprisePursue driver training and safety initia
100、tives as a core cultural valueContinue to leverage our service mix to manage through all market cyclesGrow our revenue base prudently with a focus on dedicated contract service andbrokerage by cross-selling our services with existing customers and pursuing newcustomer opportunitiesCapitalize on high
101、 return on investment potential of advanced technology,automation,andoptimizationContinue to use our scale and relationships to gain early access to technological advancesand evaluate the costs and benefitsIncubate,develop,and implement operating efficiencies across our enterprise using ourUSX Varia
102、nt technology development groupPursue use of artificial intelligence to accommodate individual drivers preferences withthe goal of improving driver satisfaction and retentionApply data analytics across the billions of dollars of freight spend we see every year tocapture and optimize the execution of
103、 our customers loads and our network2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm12/155Page 8Partner with equipment manufacturers to test,evaluate and refine electric,auto
104、nomousand other advanced vehicle technology2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm13/155Table of ContentsMaintain flexibility through long-term enterprise planning a
105、nd conservative financial policiesMaximize our free cash flow generation by managing expenses,taxes and capitalexpendituresConvert equipment financing over time toward owned equipment from operating leasedequipment to gain tax benefits and flexibility in trade cyclesAllocate capital toward dedicated
106、 contract services,which offers more predictable revenuestreams and greater asset productivity,Variant,which is our digital fleet and brokerage,which requires limited capital investment and affords network-balancing freight volumesTarget a conservative leverage profile,taking into consideration both
107、 owned and leasedfinancingUse of digital technologies to reduce the impact of market cycle downturnsIndependent ContractorsIn addition to the company drivers that we employ,we enter into contracts with independentcontractors.Independent contractors operate their own tractors(although some employ dri
108、vers theyhire)and provide their services to us under contractual arrangements.Except for generally providingindependent contractors with the use of our trailers,they are responsible for the ownership andoperating expenses and are compensated by us primarily on a rate per mile basis.By operating safe
109、lyand productively,independent contractors can improve their own profitability and ours.We believe thatthe fleet of independent contractors we engage provides significant advantages that primarily arise fromthe motivation of business ownership.Independent contractors tend to produce more miles per t
110、ractorper week.As of December 31,2021,the approximately 1,200 independent contractors we engagecomprised approximately 17%of our available capacity,as measured by tractor count.Services offered to independent contractors include insurance,maintenance and fuel.Through ourwholly owned insurance captiv
111、e subsidiary,Xpress Assurance,Inc.(“Xpress Assurance”),independentcontractors can purchase occupational accident,physical damage and other types of insurance.Independent contractors also are able to procure at their expense fuel and maintenance services at ourtruckload service centers.Human Capital
112、ResourcesGeneralAs of December 31,2021,we employed approximately 8,689 employees,of whom approximately 5,952were drivers,approximately 321 were maintenance technicians and approximately 2,416 were officeemployees,including operations staff,sales and marketing,recruiting,safety and other supportperso
113、nnel.None of our employees are covered by a collective bargaining agreement.To attract and retain the best-qualified talent,we offer competitive benefits,including market-competitive compensation,healthcare,paid time off,401(k),employee stock purchase,tuitionassistance,employee skills development an
114、d leadership development.Professional truck drivers are the backbone of our success and the heart of the Company.Responsibilityfor driver retention flows throughout our organization and every office and maintenance employee isexpected to take the necessary steps to keep our drivers satisfied and pro
115、ductive.Keeping our driverssatisfied and safe is the guiding principle behind our modern fleet,training programs and drivercompensation.We continue to focus on driver centric initiatives such as increased miles and modernequipment,to both retain the professional drivers who have chosen to partner wi
116、th us and attract newprofessional drivers to our team.Corporate Culture&Diversity2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm14/155Page 9We recruit,develop,and retain div
117、erse talent.This strategy is paying huge dividends not only for theorganization,but for our employees.To foster their and our joint success,we seek to create anenvironment where people can do their best2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/ww
118、w.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm15/155Table of Contentsworka place where they can proudly be their authentic selves,and where they know their needs canbe met.Over the past several years we have committed to providing increased transparency on ourinclusion
119、and diversity commitments and are making progress in applying and advancing inclusivenessand diversity practices across our workplace.Workforce culture is key to successfully achieving our operational objectives.In an industry thatchanges rapidly and as part of our intentional efforts to lead digita
120、l transformation throughout theorganization,we understand ongoing training and development is needed for all employees.To addressthese evolving needs,we fill skill gaps through talent acquisition and through numerous trainingprograms for our employees such as Leadership Excellence at the Peak,Leader
121、ship ExcellenceFundamentals for new managers,Leadership Excellence Relationomics,Digital Communities ofPractice,Digital Upskilling,access to over 4,000 courses through our learning management system.Forour drivers we have re-envisioned our driver training program and developed and launched our newPr
122、ofessional Driver Onboarding Program in 2021.We aspire to the highest standards of inclusiveness,diversity and equity.During 2021,we continued tofocus on inclusion as we partnered with Wade Hinton as our Chief Inclusion Partner to conduct adetailed assessment of our inclusion and diversity efforts a
123、nd develop a best-in-class strategy focused onculture of place and inclusion for the future.We launched our self-identify survey to assist in makingdecisions from an inclusion and diversity standpoint.We launched three Employee Resource Groups(“ERG”),Womens ERG,Multi-Cultural ERG and Veterans ERG wi
124、th great participation from ouremployees.We have a strong commitment to creating a culture where everyone is included andrespected.We are committed to diverse representation across all levels of the workforce while workingto find the most qualified candidate for every position.We believe our differe
125、nces make us stronger as ateam,and it is through creating an environment that maximizes each individuals contributions,intentional focus on our cultural goals,and continuous training and development that we and ouremployees succeed.SafetyWe are committed to pursue safety as one of our core cultural
126、values.Our drivers are subject to certainhiring guidelines related to driving history,accident and safety history,physical standards and drug andalcohol testing.Upon meeting certain criteria,applicants are invited to attend an orientation at one ofour service centers.The on-site orientation is focus
127、ed on introducing a driver to the concepts andtraining necessary to be a successful,professional driver,including training related to safety,life on theroad,our operations and equipment and electronic log operation.The on-site orientation also includes aroad test.As a result of the COVID-19 pandemic
128、,we have leveraged our new driver training program aswell as created a virtual orientation program that allows new drivers to complete work remotely and,therefore,avoiding a majority of classroom work.In addition to our hiring criteria,our tractors are equipped with electronic speed limiters,automat
129、ictransmissions,lane departure and collision warning systems,air disc brakes and high performance widebrake drums,electronic roll stability and,more recently,forward-facing cameras.COVID-19 UpdateIn response to the COVID-19 pandemic,we moved quickly to enable our office employees to workremotely sta
130、rting March 2020.Since then,non-remote personnel have largely been limited to employeesworking on-site at customer locations and shop technicians working in our facilities,all of whom arefollowing strict protocols to ensure their safety and the safety of our customers.We have instituted policies to
131、facilitate effective communication in this environment.For non-drivingemployees,we ensure multiple daily contacts with direct reports and have developed key performanceindicators,facilitated by our digital capabilities,to measure our operational effectiveness.We have alsoimplemented a hotline and su
132、pport staff to ensure employees have access to necessary medical servicesas well as ensuring an adequate supply of safety equipment,including masks and gloves,for ourworkers who are on the frontlines,and providing regular cleaning and disinfecting of our facilities.U.S.Xpress employees are playing a
133、n essential role in the countrys fight against COVID-19 as they work tokeep critical supplies moving and store shelves stocked.We are working daily with our drivers to keepthem informed and safe in this rapidly changing environment.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527
134、/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm16/155Page 102025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm17/155T
135、able of ContentsInsuranceWe retain high deductibles on a significant portion of our claims exposure and related expensesassociated with third party bodily injury and property damage,employee medical expenses,workerscompensation,physical damage to our equipment and cargo loss.See“Item 1A.Risk Factors
136、.”Wecurrently carry the following material types of insurance,which generally have the retention amounts,maximum benefits per claim and other limitations noted:commercial automobile liability excess coverage:approximately$75.0 million of coverageper occurrence effective September 1,2020,subject to a
137、$3.0 million retention peroccurrence with annual aggregate limits within the$3.0 to$10.0 million layer of$14.0million and a three-year policy aggregate of$28.0 million;general liability,business auto liability and excess employers liability coverage:approximately$75.0 million of coverage per occurre
138、nce subject to a$25,000 deductibleper occurrence for general liability claims,$50,000 deductible per occurrence for businessauto claims and$500,000 deductible for excess employers liability:cargo damage and loss:$2.0 million limit per tractor or trailer subject to a$250,000 retentionper occurrence;w
139、orkers compensation/employers liability:statutory coverage limits subject to a$500,000retention for each accident or disease;employment practices and wage and hour liability:$25.0 million aggregate limit in coveragesubject to a$1.0 million retention for employment practices and$2.5 million retention
140、 forwage and hour for either a single claim or a class action;directors and officers insurance:$75.0 million aggregate limit of coverage subject to a$1.0million retention with various sub-limits;fiduciary liability policy:$10.0 million aggregate limit of coverage subject to a$10,000retention;employe
141、e healthcare:we retain each employee health care claim and maintain stop lossinsurance of$1.0 million;crime insurance:$5.0 million of coverage subject to a$250,000 retention;and underground storage tank liability:$5.0 million in coverage with deductibles ranging from$25,000 to$75,000.RegulationTrans
142、portation RegulationsOur operations are regulated and licensed by various government agencies,including the Department ofTransportation(“DOT”),Environmental Protection Agency(“EPA”)and the Department of Homelandsecurity(“DHS”).These and other federal and state agencies also regulate our equipment,op
143、erations,drivers and third-party carriers.The DOT,through the Federal Motor Carrier Safety Administration(“FMCSA”),imposes safety andfitness regulations on us and our drivers,including rules that restrict driver hours-of-service.Changes tosuch hours-of-service rules can negatively impact our product
144、ivity and affect our operations andprofitability by reducing the number of hours per day or week our drivers may operate and/or disruptingour network.However,in August 2019,the FMCSA issued a proposal to make changes to its hours-of-service rules that would allow truck drivers more flexibility with
145、their 30-minute rest break and withdividing their time in the sleeper berth.It also would extend by two hours the duty time for driversencountering adverse weather,and extend the shorthaul exemption by lengthening the drivers2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20
146、211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm18/155Page 11maximum on-duty period from 12 hours to 14 hours.In June 2020 the FMCSA adopted a final rulesubstantially as proposed,which became effective in September 2020.Certain industry groups havec
147、hallenged these rules in court,and it remains unclear what,if anything,will come from suchchallenges.Any future changes to hours-of-service rules could materially adversely affect our results ofoperations and profitability.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-2021
148、1231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm19/155Table of ContentsThere are two methods of evaluating the safety and fitness of carriers.The first method is theapplication of a safety rating that is based on an onsite investigation and affects a
149、carriers ability tooperate in interstate commerce.We currently have a satisfactory DOT safety rating for our U.S.operations under this method,which is the highest available rating under the current safety rating scale.If we were to receive a conditional or unsatisfactory DOT safety rating,it could m
150、aterially adverselyaffect our business,as some of our existing customer contracts require a satisfactory DOT safety rating.In January 2016,the FMCSA published a Notice of Proposed Rulemaking outlining a revised safetyrating measurement system,which would replace the current methodology.Under the pro
151、posed rule,thecurrent three safety ratings of“satisfactory,”“conditional”and“unsatisfactory”would be replaced witha single safety rating of“unfit,”and a carrier would be deemed fit when no rating was assigned.Moreover,the proposed rules would use roadside inspection data in addition to investigation
152、s and onsitereviews to determine a carriers safety fitness on a monthly basis.Under the current rules,a safetyrating can only be given upon completion of a comprehensive onsite audit or review.Under theproposed rules,a carrier would be evaluated each month and could be given an“unfit”rating if the d
153、atacollected from roadside inspections,investigations and onsite reviews did not meet certain standards.The proposed rule underwent a public comment period extending into May 2016 and several industrygroups and lawmakers have expressed their disagreement with the proposed rule,arguing that it violat
154、esthe requirements of the Fixing Americas Surface Transportation Act(the“FAST Act”),and that theFMCSA must first finalize its review of the Compliance,Safety,Accountability program(“CSA”)scoring system,described in further detail below.Based on this feedback and other concerns raised byindustry stak
155、eholders,in March 2017,the FMCSA withdrew the Notice of Proposed Rulemaking relatedto the new safety rating system.In its notice of withdrawal,the FMCSA noted that a new rulemakingrelated to a similar process may be initiated in the future.Therefore,it is uncertain if,when or underwhat form any such
156、 rule could be implemented.The FMCSA has also indicated that it is in the earlyphases of a new study on the causation of crashes.Although it remains unclear whether such study willultimately be completed,the results of such study could spur further proposed and/or final rules inregard to safety and
157、fitness.In addition to the safety rating system,the FMCSA has adopted the CSA program as an additionalsafety enforcement and compliance model that evaluates and ranks fleets on certain safety-relatedstandards.The CSA program analyzes data from roadside inspections,moving violations,crash reportsfrom
158、 the last two years and investigation results.The data is organized into seven categories.Carriersare grouped by category with other carriers that have a similar number of safety events(e.g.,crashes,inspections or violations)and carriers are ranked and assigned a rating percentile to prioritize them
159、 forinterventions if they are above a certain threshold.Currently,these scores do not have a direct impact ona carriers safety rating.However,the occurrence of unfavorable scores in one or more categories may(i)affect driver recruiting and retention by causing high-quality drivers to seek employment
160、 with othercarriers,(ii)cause our customers to direct their business away from us and to carriers with higher fleetrankings,(iii)subject us to an increase in compliance reviews and roadside inspections,(iv)cause us toincur greater than expected expenses in our attempts to improve unfavorable scores
161、or(v)increase ourinsurance expenses,any of which could adversely affect our results of operations and profitability.Under the CSA,these scores were initially made available to the public in five of the seven categories.However,pursuant to the FAST Act which was signed into law in December 2015,the F
162、MCSA wasrequired to remove from public view the previously available CSA scores while it reviews the reliabilityof the scoring system.During this period of review by the FMCSA,we will continue to have access toour own scores and will still be subject to intervention by the FMCSA when such scores are
163、 above theintervention thresholds.A study was conducted and delivered to the FMCSA in June 2017 with severalrecommendations to make the CSA program more fair,accurate,and reliable.In late June 2018,theFMCSA provided a report to Congress outlining the changes it may make to the CSA program inresponse
164、 to the study.Such changes include the testing and possible adoption of a revised risk modelingtheory,potential collection and dissemination of additional carrier data and revised measures forintervention thresholds.The adoption of such changes is contingent on the results of the new modelingtheory
165、and additional public feedback.Therefore,it is unclear if,when and to what extent such changesto the CSA program will occur.However,any changes that increase the likelihood of us receivingunfavorable scores could materially adversely affect our results of operations and profitability.In May 2020 the
166、 FMCSA announced that effective immediately it is making permanent a pilot programthat will not count a crash in which a motor carrier was not at fault when calculating the carriers safetymeasurement profile,called the Crash Preventability Demonstration Program(“CPDP”).The CPDP will2025/1/18 08:34se
167、c.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm20/155Page 12expand the types of eligible crashes,modify the Safety Measurement System to exclude crashes withnot preventable determinations fr
168、om the prioritization algorithm and note the not preventabledeterminations in the Pre-Employment Screening Program.Under the program,carriers with eligiblecrashes that occurred on or after August 2019,may submit a Request for Data Review with the requiredpolice accident report and other supporting d
169、ocuments,photos or videos through the FMCSAs DataQswebsite.If the FMCSA determines the crash was not preventable,it will be listed on the SafetyMeasurement System but not included when calculating a2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.se
170、c.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm21/155Table of Contentscarriers Crash Indicator Behavior Analysis and Safety Improvement Category measure in SMS.Additionally,the not preventable determinations will be noted on a drivers Pre-Employment ScreeningProgram report.T
171、he final rule requiring the use of ELDs was published in December 2015.This rule required drivers ofcommercial motor vehicles that are required to keep logs to be ELD-compliant by December 2017.Useof automatic onboard recording devices was permitted until December 2019,at which time use of ELDsbecam
172、e required.We were fully converted to ELDs by the December 2019 deadline.We believe thatmore effective hours-of-service enforcement under this rule may improve our competitive position bycausing all carriers to adhere more closely to hours-of-service requirements.In December 2016,the FMCSA issued a
173、final rule establishing a national clearinghouse for drug andalcohol testing results and requiring motor carriers and medical review officers to provide records ofviolations by commercial drivers of FMCSA drug and alcohol testing requirements.Motor carriers arerequired to query the clearinghouse to
174、ensure drivers and driver applicants do not have violations offederal drug and alcohol testing regulations that prohibit them from operating commercial motorvehicles.The final rule became effective in January 2017,with a compliance date in January 2020.InDecember 2019,however,the FMCSA announced a f
175、inal rule extending by three years the date for statedrivers licensing agencies to comply with certain Drug and Alcohol Clearinghouse requirements.TheDecember 2016 commercial drivers license rule required states to request information from theClearinghouse about individuals prior to issuing,renewing
176、,upgrading or transferring a CDL.This newaction will allow states compliance with the requirement,which was set to begin January 2020,to bedelayed until January 2023.That being said,the FMCSA has indicated it will allow states the option tovoluntarily query Clearinghouse information beginning Januar
177、y 2020.The compliance date of January2020 remained in place for all other requirements set forth in the Clearinghouse final rule,however.Upon implementation,the rule may reduce the number of available drivers in an already constraineddriver market.Pursuant to a new rule finalized by the FMCSA,effect
178、ive November 2021,states arerequired to query the Clearinghouse when issuing,renewing,transferring,or upgrading a commercialdrivers license and must revoke a drivers commercial driving privileges if such driver is prohibitedfrom driving a motor vehicle for one or more drug or alcohol violations.In S
179、eptember 2020,the Department of Health and Human Services(“DHHS”)announced proposedmandatory guidelines to allow employers to drug test truck drivers and other federal workers for pre-employment and random testing using hair specimens.However,the proposal also requires a secondsample using either ur
180、ine or an oral swab test if a hair test is positive,if a donor is unable to provide asufficient amount of hair for faith-based or medical reasons,or due to an insufficient amount or lengthof hair.The proposal specifically requires that the second test be done simultaneously at the collectionevent or
181、 when directed by the medical review officer after review and verification of laboratory-reported results for the hair specimen.DHHS indicated the two-test approach is intended to protectfederal workers from issues that have been identified as limitations of hair testing,and related legaldeficiencie
182、s identified in two prior court cases.The American Trucking Associations(“ATA”)hasvoiced concerns with the new guidelines,characterizing them as“weak”and“misguided,”and speciallytaking issue with the second sample requirement,which the ATA feels diminishes the value of hairtesting.It is unclear if,a
183、nd when,a final rule may be put in place.Any final rule may reduce the numberof available drivers.We currently perform hair follicle testing and will continue monitor anydevelopments in this area to ensure compliance.Other rules have been recently proposed or made final by the FMCSA,including(i)a ru
184、le requiring theuse of speed limiting devices on heavy duty tractors to restrict maximum speeds,which was proposed in2016,and(ii)a rule setting forth minimum driver-training standards for new drivers applying forcommercial drivers licenses for the first time and to experienced drivers upgrading thei
185、r licenses orseeking a hazardous materials endorsement,which was made final in December 2016,with acompliance date in February 2020.However,in May 2020,the FMCSA approved an interim ruledelaying implementation of the final rule by two years which extended the compliance date to February2022.In July
186、2017,the DOT announced that it would no longer pursue a speed limiter rule,but leftopen the possibility that it could resume such a pursuit in the future.In May 2021,however,the CullumOwings Large Truck Safe Operating Speed Act was reintroduced into the U.S.House of Representativesand would require
187、commercial motor vehicles with a gross weight of more than 26,000 pounds to beequipped with a speed limiter that would limit the vehicles speed to no more than 65 M.P.H.The effectof these rules,to the extent they become effective,could result in a decrease in fleet production and2025/1/18 08:34sec.g
188、ov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm22/155Page 13driver availability,either of which could materially adversely affect our business,financial conditionand results of operations.The I
189、nfrastructure Investment and Jobs Act(“IIJA”),signed into law by President Biden in November2021,created an apprenticeship program for drivers younger than 21 to eventually qualify to drivecommercial trucks in interstate commerce.The provision drew certain mechanics from the billsintroduced in Congr
190、ess in 2019 related to lowering the2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm23/155Table of Contentsage requirements for interstate commercial driving.The FMCSA announc
191、ed the establishment of thisapprenticeship program in January 2022 in an effort to help the industrys ongoing driver shortage.Theprogram is open to 18 to 20-year-old drivers who already hold intrastate commercial drivers licensesand sets a strict training regimen for participating drivers and carrie
192、rs to comply with.Motor carriersinterested in participating must complete an application for participation and submit monthly data on anapprentices driver activity,safety outcomes,and additional supporting information.It remains unclearwhether any regulatory changes will stem from the apprenticeship
193、 program.In December 2018,the FMCSA granted a petition filed by the ATA and in doing so determined thatfederal law does preempt Californias wage and hour laws,and interstate truck drivers are not subject tosuch laws.The FMCSAs decision has been appealed by labor groups,and multiple lawsuits have bee
194、nfiled in federal courts seeking to overturn the decision.In January 2021,the Ninth Circuit upheld theFMCSAs determination that federal law does preempt Californias meal and rest break laws,as appliedto drivers of property-carrying commercial motor vehicles.Other current and future state and localwa
195、ge and hour laws,including laws related to employee meal breaks and rest periods,may also varysignificantly from federal law.Further,driver piece rate compensation,which is an industry standard,has been attacked as non-compliant with state minimum wage laws and lawsuits have recently beenfiled and/o
196、r adjudicated against carriers demanding compensation for sleeper berth time,layovers,restbreaks and pre-trip and post-trip inspections,the outcome of which could have major implications forthe treatment of time that drivers spend off-duty(whether in a trucks sleeper berth or otherwise)underapplicab
197、le wage laws.Both of these issues are adversely impacting the Corporation and the industry asa whole,with respect to the practical application of the laws,thereby resulting in additional cost.As aresult,we,along with other companies in our industry,are subject to an uneven patchwork of wage andhour
198、laws throughout the United States.In the past,certain legislators have proposed federal legislationto preempt state and local wage and hour laws;however,passage of such legislation is uncertain.Iffederal legislation is not passed,we will either need to comply with the most restrictive state and loca
199、llaws across our entire fleet,or revise our management systems to comply with varying state and locallaws.Either solution could result in increased compliance and labor costs,driver turnover,decreasedefficiency,and amplified legal exposure.Tax and other regulatory authorities,as well as independent
200、contractors themselves,have increasinglyasserted that independent contractor drivers in the trucking industry are employees rather thanindependent contractors and our classification of independent contractors has been the subject of auditsby such authorities from time to time.Federal legislation has
201、 been introduced in the past that wouldmake it easier for tax and other authorities to reclassify independent contractors as employees,includinglegislation to increase the recordkeeping requirements for those that engage independent contractordrivers and to increase the penalties for companies who m
202、isclassify their employees and are found tohave violated employees overtime and/or wage requirements.The most recent example being theProtecting the Rights to Organize(“PRO”)Act,which was passed by the House of Representatives andreceived by the Senate in March 2021 and remains with the Senates Comm
203、ittee on Health,Education,Labor,and Pensions.The PRO Act proposes to apply the“ABC Test”for classifying workers underFederal Fair Labor Standards Act claims.It is unknown whether any of the proposed legislation willbecome law or whether any industry-based exemptions from any resulting law will be gr
204、anted.Additionally,federal legislators have sought to abolish the current safe harbor allowing taxpayersmeeting certain criteria to treat individuals as independent contractors if they are following a long-standing,recognized practice,extend the Fair Labor Standards Act to independent contractors an
205、dimpose notice requirements based on employment or independent contractor status and fines for failureto comply.Some states have put initiatives in place to increase their revenue from items such asunemployment,workers compensation and income taxes and a reclassification of independentcontractors as
206、 employees would help states with this initiative.Recently,courts in certain states have issued decisions that could result in a greater likelihood thatindependent contractors would be judicially classified as employees in such states.In September 2019,California enacted A.B.5(“AB5”),a new law that
207、changed the landscape of the states treatment ofemployees and independent contractors.AB5 provides that the three-pronged“ABC Test”must be usedto determine worker classification in wage-order claims.Under the ABC Test,a worker is presumed tobe an employeeand the burden to demonstrate their independe
208、nt contractor status is on the hiringcompany through satisfying all 3 of the following criteria:the worker is free from control and direction in the performance of services;and2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/d
209、ata/923571/000155837022002527/usx-20211231x10k.htm24/155Page 14the worker is performing work outside the usual course of the business of the hiring company;andthe worker is customarily engaged in an independently established trade,occupation,orbusiness.How AB5 will be enforced is still to be determi
210、ned.In January 2021,however,the California SupremeCourt ruled that the ABC Test could apply retroactively to all cases not yet final as of the date theoriginal decision was rendered,April2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archi
211、ves/edgar/data/923571/000155837022002527/usx-20211231x10k.htm25/155Table of Contents30,2018.While AB5 was set to go into effect in January 2020,a federal judge in California issued apreliminary injunction barring the enforcement of AB5 on the trucking industry while the CaliforniaTrucking Associatio
212、n(“CTA”)moves forward with its suit seeking to invalidate AB5.The Ninth CircuitCourt of Appeals rejected the reasoning behind the injunction in April 2021,ruling that AB5 is not pre-empted by federal law,but granted a stay of the AB5 mandate in June 2021(preventing its applicationand temporarily con
213、tinuing the injunction)while the CTA petitioned the U.S.Supreme Court(the“Supreme Court”)to review the decision.In November 2021,the Supreme Court requested that the U.S.solicitor general weigh in on the case.The injunction will remain in place until the Supreme Courtmakes a decision on whether to p
214、roceed in hearing the case.While the stay of the AB5 mandateprovides temporary relief to the enforcement of AB5,it remains unclear how long such relief will last,and whether the CTA will ultimately be successful in invalidating the law.It is also possible AB5 willspur similar legislation in states o
215、ther than California,which could adversely affect our results ofoperations and profitability.Further,class actions and other lawsuits have been filed against certain members of our industry seekingto reclassify independent contractors as employees for a variety of purposes,including workerscompensat
216、ion and health care coverage.Taxing and other regulatory authorities and courts apply avariety of standards in their determination of independent contractor status.If independent contractorswe contract with are determined to be employees,we would incur additional exposure under federal andstate tax,
217、workers compensation,unemployment benefits,labor,employment and tort laws,includingfor prior periods,as well as potential liability for employee benefits and tax withholdings.Environmental RegulationsFrom time to time we engage in the transportation of hazardous substances.Additionally,some of ourtr
218、actor terminals are located in areas where groundwater or other forms of environmental contaminationcould occur.Our operations involve the risks of fuel spillage or seepage,environmental damage,andhazardous waste disposal,among others.Certain of our facilities have wash facilities,waste oil or fuels
219、torage tanks and fueling islands.If we are involved in a spill or other accident involving hazardoussubstances,if there are releases of hazardous substances we transport,if soil or groundwatercontamination is found at our facilities or results from our operations,or if we are found to be inviolation
220、 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 amaterially adverse effect on our business,financial condition and results of operations.In August 2011,the Nationa
221、l Highway Traffic Safety Administration(the“NHTSA”)and the EPAadopted a new rule that established the first-ever fuel economy and greenhouse gas standards formedium and heavy-duty vehicles,including the tractors we employ(the“Phase 1 Standards”).ThePhase 1 Standards apply to tractor model years 2014
222、 to 2018 and require the achievement of anapproximate 20 percent reduction in fuel consumption by the 2018 model year,which equates toapproximately four gallons of fuel for every 100 miles traveled.In addition,in February 2014,PresidentObama announced that his administration would begin developing t
223、he next phase of tighter fuelefficiency and greenhouse gas standards for medium-and heavy-duty tractors and trailers(the“Phase 2Standards”).In October 2016,the EPA and NHTSA published the final rule mandating that the Phase 2Standards will apply to trailers beginning with model year 2018 and tractor
224、s beginning with model year2021.The Phase 2 Standards require nine percent and 25 percent reductions in emissions and fuelconsumption for trailers and tractors,respectively,by 2027.The final rule was effective in December2016,but has since faced challenges and delays.In October 2017,the EPA announce
225、d a proposal torepeal the Phase 2 Standards as they relate to gliders(which mix refurbished older components,including transmissions and pre-emission-rule engines,with a new frame,cab,steer axle,wheels,andother standard equipment).The outcome of such proposal is still undetermined.Additionally,imple
226、mentation of the Phase 2 Standards as they relate to trailers has been challenged in the U.S.Courtof Appeals for the District of Columbia.In November 2021,a panel for the U.S.Court of Appeals forthe District of Columbia ruled in favor of the association challenging the standards and vacated allporti
227、ons of the Phase 2 Standards that applied to trailers,and consequently,the Phase 2 Standards willonly require reductions in emissions and fuel consumption for tractors.The Companys new tractorpurchases in 2021 complied with the emission and fuel consumption reductions required by the Phase 2Standard
228、s.Even though the trailer provisions of the Phase 2 standards have been removed,we will stillneed to ensure the majority of our fleet is compliant with the California Phase 2 standards.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archive
229、s/edgar/data/923571/000155837022002527/usx-20211231x10k.htm26/155Page 15In January 2020,the EPA announced it is seeking input on reducing emissions of nitrogen oxides andother pollutants from heavy-duty trucks.The EPA anticipates taking final action on the new plan,commonly referred to as the“Cleane
230、r Trucks Initiative,”as soon as 2022.The EPA is targeting 2027 forthese new standards to take effect and is also working on enacting more stringent greenhouse gasemission standards(beginning with model year 2030 vehicles)by the end of 2024.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/0001558370
231、22002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm27/155Table of ContentsThe California Air Resources Board(“CARB”)also adopted emission control regulations that will beapplicable to all heavy-duty tractors that pull 53-foot or longer b
232、ox-type trailers within the State ofCalifornia.The tractors and trailers subject to these CARB regulations must be either EPA SmartWaycertified or equipped with low-rolling resistance tires and retrofitted with SmartWay-approvedaerodynamic technologies.Enforcement of these CARB regulations for 2011
233、model year equipmentbegan in January 2010 and have been phased in over several years for older equipment.In order tocomply with the CARB regulations,we submitted a large fleet compliance plan to CARB in June 2010.In addition,in February 2017 CARB proposed California Phase 2 standards that would gene
234、rally alignwith the federal Phase 2 Standards,with some minor additional requirements,and as proposed wouldstay in place even if the federal Phase 2 Standards are affected.In February 2019,the California Phase 2standards became final.Thus,even though the trailer provisions of the Phase 2 Standards w
235、ereremoved,we will still need to ensure the majority of our fleet is compliant with the California Phase 2standards,which may result in increased equipment costs and could adversely affect our operatingresults and profitability.CARB has also recently announced intentions to adopt regulations ensurin
236、g that100%of tractors operating in California are operating with battery or fuel cell-electric engines in thefuture.Whether these regulations will ultimately be adopted remains unclear.We will continuemonitoring our compliance with the CARB regulations.Federal and state lawmakers also have proposedp
237、otential limits on carbon emissions under a variety of climate-change proposals.Compliance with suchregulations has increased the cost of our new tractors,may increase the cost of any new trailers that willoperate in California,may require us to retrofit certain of our pre-2011 model year trailers t
238、hat operatein California and could impair equipment productivity and increase our operating expenses.Theseadverse effects,combined with the uncertainty as to the reliability of the newly designed diesel enginesand the residual values of these vehicles,could materially increase our costs or otherwise
239、 materiallyadversely affect our business,financial condition and results of operations.In June 2020 CARB alsopassed the Advanced Clean Trucks(“ACT”)regulation,which became effective in March 2021 andgenerally requires original equipment manufacturers to begin shifting towards greater production ofze
240、ro-emission heavy duty tractors starting in 2024.Under ACT,by 2045,every new tractor sold inCalifornia will need to be zero-emission.While ACT does not apply to those simply operating tractorsin California,it could affect the cost and/or supply of traditional diesel tractors and may lead to similarl
241、egislation in other states or at the federal level.In order to reduce exhaust emissions,some states and municipalities have begun to restrict the locationsand amount of time where diesel-powered tractors may idle.These restrictions could force us topurchase on-board power units that do not require t
242、he engine to idle or to alter its drivers behavior,which could result in increased costs.In addition to the foregoing laws and regulations,our operations are subject to other federal,state andlocal environmental laws and regulations,many of which are implemented by the EPA and similar stateagencies.
243、Such laws and regulations generally govern the management and handling of hazardousmaterials,discharge of pollutants into the air,surface water and other environmental media,andgroundwater preservation and disposal of certain various substances.We do not believe that ourcompliance with these statuto
244、ry and regulatory measures has had a material adverse effect on ourbusiness,financial condition and results of operations.Food Safety RegulationsIn April 2016,the Food and Drug Administration(“FDA”)published a final rule establishingrequirements for shippers,loaders,carriers by motor vehicle and rai
245、l vehicle and receivers engaged inthe transportation of food,to use sanitary transportation practices to ensure the safety of the food theytransport as part of the Food Safety Modernization Act(“FSMA”).This rule sets forth requirementsrelated to(i)the design and maintenance of equipment used to tran
246、sport food,(ii)the measures takenduring food transportation to ensure food safety,(iii)the training of carrier personnel in sanitary foodtransportation practices and(iv)maintenance and retention of records of written procedures,agreementsand training related to the foregoing items.These requirements
247、 took effect for larger carriers such as usin April 2017.The FSMA is applicable to us not only as a carrier,but we are also considered a shipperwhen acting in the role of broker.We believe we have been in compliance with the FSMA since thecompliance date.However,if we are found to be in violation of
248、 applicable laws or regulations related tothe FSMA or if we transport food or goods that are contaminated or are found to cause illness and/ordeath,we could be subject to substantial fines,lawsuits,penalties and/or criminal and civil liability,any2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000
249、155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm28/155Page 16of which could have a material adverse effect on our business,financial condition and results ofoperations.As the FDA continues its efforts to modernize food safety,i
250、t is likely additional food safety regulationswill take effect in the future.In July 2020,the FDA released its“New Era of Smarter Food Safety”blueprint,which creates a ten year roadmap to create a more digital,traceable and safer food system.This blueprint builds on the work done under the FSMA,and
251、while it is still unclear what,if any,changes to the current governing framework may ultimately take effect,further2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm29/155Table
252、 of Contentsregulation in this area could negatively affect our business by increasing our compliance obligations andrelated expenses going forward.Executive and Legislative ClimateIt is still to be determined how President Bidens leadership will impact our industry.That being said,President Biden h
253、as indicated his intent to make a green infrastructure package a top priority for hisadministration.Any measure in furtherance thereof could draw from the Build Back Better Act(the“BBB”),which passed the U.S.House of Representatives,but is facing resistance in the U.S.Senate.Ascurrently proposed,the
254、 BBB would impact transportation by allocating funds to address variousindustry related issues such as port congestion and traffic safety enforcement.The bill also promotes amyriad of low-emission programs,transit services and clean energy projects,as well as funding forclimate change research.It is
255、 unclear whether these legislative initiatives will be signed into law andwhat changes they may undergo.However,adoption and implementation could negatively impact ourbusiness by increasing our compliance obligations and related expenses.President Biden also has indicated an intention to make substa
256、ntial changes to the current U.S.tax lawsduring his administration,including changes to the way capital gains are treated.Any changes to U.S.tax laws may have an adverse impact on our business and profitability.The United States Mexico Canada Agreement(“USMCA”)was entered into effect in July 2020.Th
257、eUSMCA is designed to modernize food and agriculture trade,advance rules of origin for automobilesand trucks,and enhance intellectual property protections,among other matters,according to the Officeof the U.S.Trade Representative.It is difficult to predict at this stage what could be the impact of t
258、heUSMCA on the economy,including the transportation industry.However,given the amount of NorthAmerican trade that moves by truck,it could have a significant impact on supply and demand in thetransportation industry,and could adversely impact the amount,movement and patterns of freight wetransport.Th
259、e IIJA was signed into law by President Biden in November 2021.The roughly$1.2 trillion billcontains an estimated$550 billion in new spending,which will impact transportation.In particular,itdedicates more than$100 billion for surface transportation networks and roughly$66 billion for freightand pas
260、senger rail operations.Among provisions in the law specific to trucking is the aforementionedapprenticeship program for drivers younger than 21 to eventually qualify to drive commercial trucks ininterstate commerce.It remains unclear how the IIJA will be implemented into and effect our industry.The
261、IIJA may result in increased compliance and implementation related expenses,which could have anegative impact on our operations.Given COVID-19s considerable effect on our industry,the FMCSA issued and/or extended varioustemporary responsive measures throughout the year.Although,to date,these measure
262、s have largelybeen enacted in order to assist industry participants in operating under adverse circumstances,anyfurther responsive measures remain unclear and could have a negative impact on our operations.In November 2021,the U.S.Department of Labors Occupational Safety and Health Administration(“O
263、SHA”)published an emergency temporary standard(the“Emergency Rule”)requiring all employerswith at least 100 employees to ensure that their employees are fully vaccinated or require anyemployees who remain unvaccinated to produce a negative COVID-19 test result on at least a weeklybasis before coming
264、 to work.The Emergency Rule has been blocked by the Supreme Court.EffectiveJanuary 2022,the U.S.is prohibiting unvaccinated foreigners from crossing the U.S.-Mexico border andU.S.-Canada border.Furthermore,effective January 2022,Canada is prohibiting unvaccinatedforeigners,including U.S.citizens,fro
265、m crossing their border.These border requirements,as well asany future vaccination,testing or mask mandates that are allowed to go into effect,could,among otherthings,(i)cause our unvaccinated employees to go to smaller employers,if such employers are notsubject to future mandates,or leave us or the
266、 trucking industry,especially our unvaccinated drivers,(ii)result in logistical issues,increased expenses,and operational issues from arranging for weekly tests ofour unvaccinated employees,especially our unvaccinated drivers,(iii)result in increased costs forrecruiting and retention of drivers,as w
267、ell as the cost of weekly testing,and(iv)result in decreasedrevenue if we are unable to recruit and retain drivers.Any vaccination,testing or mask mandates thatare interpreted as applying to drivers would significantly reduce the pool of drivers available to us andour industry,which would further im
268、pact the extreme shortage of available drivers.Accordingly,any2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm30/155Page 17vaccination,testing or mask mandates,if allowed to
269、go into effect,could have a material adverse effecton our business,financial condition,and results of operations.For further discussion regarding these laws and regulations,please see the section entitled“Item 1A.Risk Factors.”2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-
270、20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm31/155Table of ContentsSeasonalityIn the trucking industry,revenue has historically decreased as customers reduce shipments following thewinter holiday season and as inclement weather impedes operati
271、ons.At the same time,operatingexpenses have generally increased,with fuel efficiency declining because of engine idling and weather,causing more physical damage equipment repairs and insurance claims and costs.For the reasons stated,first quarter results historically have been lower than results in
272、each of the other three quarters of theyear.Over the past several years,we have seen increases in demand at varying times,including surgesbetween Thanksgiving and the year-end holiday season.Available InformationOur website address is .This Annual Report on Form 10-K,our quarterly reportson Form 10-
273、Q,our current reports on Form 8-K and all other reports filed with the Securities andExchange Commission pursuant to Section 13(a)or 15(d)of the Securities Exchange Act of 1934,canbe obtained free of charge by visiting our website.Information contained in or available through ourwebsite is not incor
274、porated by reference into,and you should not consider such information to be partof,this Annual Report on Form 10-K.The SEC maintains an internet site that contains reports,proxyand information statements,and other information regarding issuers that file electronically with the SECat www.sec.gov.We
275、are a Nevada corporation.We were founded by Max Fuller and Patrick Quinn in 1985 andcommenced operations in the transportation business in 1986.ITEM 1A.RISK FACTORSWhen evaluating the Company,the following discussion of risk factors,which contains forward-lookingstatements as discussed in Part I“Cau
276、tionary Note Regarding Forward-looking Statements”above,should be considered in conjunction with the other information contained in this Annual Report.If weare unable to mitigate and/or are exposed to any of the following risks in the future,then there could bea material,adverse effect on our busine
277、ss,financial condition and results of operations.STRATEGIC RISKSOur business is subject to economic,business and regulatory factors affecting the truckload industrythat are largely beyond our control,any of which could have a material adverse effect on our resultsof operations.The truckload industry
278、 is highly cyclical,and our business is dependent on a number of factors that mayhave a negative impact on our results of operations,many of which are beyond our control.We believethat some of the most significant of these factors are economic changes that affect supply and demandin transportation m
279、arkets that could have a material adverse effect,such as:Economic conditions that decrease shipping demand or increase the supply of available tractors andtrailers can exert downward pressure on rates and equipment utilization,thereby decreasing assetproductivity.The risks associated with these fact
280、ors are heightened when the U.S.economy isweakened.Some of the principal risks during such times are as follows:we may experience low overall freight levels,which may impair our asset utilization;certain of our customers may face credit issues and cash flow problems that may lead topayment delays,in
281、creased credit risk,bankruptcies and other financial hardships thatcould result in even lower freight demand and may require us to increase our allowancefor doubtful accounts;freight patterns may change as supply chains are redesigned,resulting in an imbalancebetween our capacity and our customers f
282、reight demand;customers may solicit bids for freight from multiple trucking companies or selectcompetitors that offer lower rates from among existing choices in an attempt to lower theircosts,and we might be forced to lower our rates or lose freight;and2025/1/18 08:34sec.gov/Archives/edgar/data/9235
283、71/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm32/155Page 18 we may be forced to accept more loads from freight brokers,where freight rates are typicallylower,or may be forced to incur more non-revenue miles to obtain lo
284、ads.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm33/155Table of ContentsWe are also subject to cost increases outside our control that could materially reduce our profitab
285、ility ifwe are unable to increase our rates sufficiently.Such cost increases include,but are not limited to,increases in fuel prices,driver and office employee wages,purchased transportation costs,interest rates,taxes,tolls,license and registration fees,insurance,revenue equipment and related mainte
286、nance,tiresand other components and healthcare and other benefits for our employees.Further,we may not be ableto appropriately adjust our costs to changing market demands.In order to maintain high variability inour business model,it is necessary to adjust staffing levels to changing market demands.I
287、n periods ofrapid change,it is more difficult to match our staffing level to our business needs.Further,we may notbe able to appropriately adjust our costs to changing market demands.In addition,events outside our control,such as deterioration of U.S.transportation infrastructure andreduced investme
288、nt in such infrastructure,strikes or other work stoppages at our facilities or atcustomer,port,border or other shipping locations,armed conflicts or terrorist attacks,efforts to combatterrorism,military action against a foreign state or group located in a foreign state or heightenedsecurity requirem
289、ents 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 fuelor temporary closing of the shipping locations or U.S.borders.Such events or enhanced securitymeasures in connection wit
290、h such events could impair our operating efficiency and productivity andresult in higher operating costs.We may not be successful in achieving our business strategies.Many of our business strategies require time,significant management and financial resources andsuccessful implementation.Consequently
291、,we may be unable to effectively and successfully implementour business strategies.We also cannot ensure that our operating results,including our operatingmargins,will not be materially adversely affected by future changes in and expansion of our business,including our continued focus on expanding V
292、ariant,while finding the proper balance of domainexpertise and focusing on execution and scale,or by changes in economic conditions.Further,many ofour strategic initiatives are focused on the development and deployment of technology.These newtechnology-driven initiatives have a high degree of risk,a
293、s they involve unproven business strategiesand technologies with which we have limited or no prior experience.Because such offerings andtechnologies are new,they may involve unforeseen expenses and regulatory and other risks.There canbe no assurance that these initiatives will generate sufficient re
294、venue to offset any new expenses orliabilities associated with these new investments.It is also possible that technology developed ordeployed by others will render our technology noncompetitive or obsolete.Further,our developmentand deployment efforts with respect to new technologies could distract
295、management from currentoperations,and will divert capital and other resources from our historical operations.Despite theimplementation of our operational and tactical strategies and initiatives,we may be unsuccessful inachieving cost reductions and revenue expansion in the time frames we expect or a
296、t all.Further,ourresults of operations may be materially adversely affected by a failure to transition our legacy OTR fleetto Variant,further penetrate our existing customer base,cross-sell our services,secure new customeropportunities and manage the operations and expenses of new or growing service
297、s,including Variant.There is no assurance that we will be successful in achieving any of our business strategies.Even if weare successful in executing our business strategies,we still may not achieve our goals.We have invested significant resources to develop and grow our Variant fleet and we had 1,
298、555 tractorsin this fleet at December 31,2021.Variants operations are performing below our expectations.Additionally,in December 2021,we announced a leadership change at Variant.If we are unable toimprove the performance of Variant,we could be forced to re-integrate Variants operations into ourOTR a
299、nd Dedicated operations,which would be disruptive,could result in further write-offs ofintangibles and loss of drivers,and could have a material adverse effect on our results of operations.We operate in a highly competitive and fragmented industry,and numerous competitive factors couldimpair our abi
300、lity to improve our profitability and materially adversely affect our results ofoperations.Numerous competitive factors could impair our ability to improve our profitability and materiallyadversely affect our results of operations,including:we compete with many other truckload carriers of varying si
301、zes and service offerings(including intermodal)and,to a lesser extent,with(i)less-than-truckload carriers,2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm34/155Page 19(ii)rai
302、lroads and(iii)other transportation and brokerage companies,several of which haveaccess to more equipment and greater capital resources than we do;many of our competitors periodically reduce their freight rates to gain business,especiallyduring times of reduced growth in the economy,which may limit
303、our ability to maintain orincrease freight rates or to2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm35/155Table of Contentsmaintain or expand our business or may require us
304、 to reduce our freight rates in order tomaintain business and keep our equipment productive;we may increase the size of our fleet during periods of high freight demand during which ourcompetitors also increase their capacity,and we may experience losses in greater amountsthan such competitors during
305、 subsequent cycles of softened freight demand if we arerequired to dispose of assets at a loss to match reduced freight demand;we may have difficulty recruiting and retaining drivers because upgrades of our tractor fleetto match or exceed those of our competitors may not increase our cost savings or
306、profitability;some of our larger customers are other transportation companies and/or also operate theirown private trucking fleets,and they may decide to transport more of their own freight;some shippers have reduced or may reduce the number of carriers they use by selectingpreferred carriers as app
307、roved service providers or by engaging dedicated providers,andwe may not be selected;consolidation in the trucking industry may create other large carriers with greater financialresources and other competitive advantages,and we may have difficulty competing withthem;our competitors may have better s
308、afety records than us or a perception of better safetyrecords;competition from freight brokerage companies may materially adversely affect our customerrelationships and freight rates;new digital entrants with cheaper sources of capital could inhibit our ability to compete;our competitors may have be
309、tter technology that may lead to increased operatingefficiencies,reduced costs,a better ability to recruit drivers and more demand for theirservices,and economies of scale that procurement aggregation providers may pass on to smaller carriersmay improve such carriers ability to compete with us.We ma
310、y not make acquisitions in the future,which could impede growth,or if we do,we may not besuccessful in integrating any acquired businesses,either of which could have a material adverseeffect on our business.Historically,a key component of our growth strategy has been to pursue acquisitions of comple
311、mentarybusinesses.We currently do not expect to make any material acquisitions over the next few years,whichcould impede growth.If we do make acquisitions,we cannot assure that we will be successful innegotiating,consummating or integrating the acquisitions.If we succeed in consummating futureacquis
312、itions,our business,financial condition and results of operations,may be materially adverselyaffected because:some of the acquired businesses may not achieve anticipated revenue,earnings or cashflows;we may assume liabilities that were not disclosed to us or otherwise exceed our estimates;we may be
313、unable to integrate acquired businesses successfully,or at all,and realizeanticipated economic,operational and other benefits in a timely manner,which couldresult in substantial costs and delays or other operational,technical or financial problems;acquisitions could disrupt our ongoing business,dist
314、ract our management and divert ourresources;we may experience difficulties operating in markets in which we have had no or onlylimited direct experience;we may incur transactions costs and acquisition-related integration costs;we could lose customers,employees and drivers of any acquired company;we
315、may incur additional indebtedness;and2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm36/155Page 20we may issue additional shares of our Class A common stock,which would dilut
316、e theownership of our then-existing stockholders.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm37/155Table of ContentsOPERATIONAL RISKSIncreases in driver compensation or d
317、ifficulties attracting and retaining qualified drivers couldmaterially adversely affect our profitability and ability to maintain or grow our fleet.Like many truckload carriers,we experience substantial difficulty in attracting and retaining sufficientnumbers of qualified drivers,which includes the
318、engagement of independent contractors.Our industryis subject to a shortage of qualified drivers.Such shortage is exacerbated during periods of economicexpansion,in which alternative employment opportunities,including in the construction andmanufacturing industries,which may offer better compensation
319、 and/or more time at home,are moreplentiful and freight demand increases,or during periods of economic downturns,in whichunemployment benefits might be extended and financing is limited for independent contractors whoseek to purchase equipment,or the scarcity or growth of loans for students who seek
320、 financial aid fordriving school.Furthermore,capacity at driving schools may be limited by COVID-19 related socialdistancing requirements.Regulatory requirements,including those related to safety ratings,ELDs,hours-of-service changes COVID-19 mitigation measures,such as vaccination,testing,and maskm
321、andates,and an improved economy could further reduce the pool of eligible drivers or force us toincrease driver compensation to attract and retain drivers.We have seen evidence that stricter hours-of-service regulations adopted by the DOT in the past have tightened,and,to the extent new regulationsa
322、re enacted,may continue to tighten,the market for eligible drivers.The lack of adequate tractorparking along some U.S.highways and congestion caused by inadequate highway funding may make itmore difficult for drivers to comply with hours-of-service regulations and cause added stress for drivers,furt
323、her reducing the pool of eligible drivers.We have implemented driver pay increases to address thisshortage and we are implementing initiatives aimed at reducing the daily friction faced by our drivers inhopes of reducing turnover.However,the compensation we offer our drivers and independent contract
324、orexpenses are subject to market conditions and our initiatives to reduce driver turnover may proveunsuccessful,therefore we may find it necessary to further increase driver compensation,change thestructure of our driver compensation and/or become subject to increased independent contractorexpenses
325、in future periods,which could materially adversely affect our growth and profitability.In addition,we suffer from a high turnover rate of drivers and our turnover rate is higher than theindustry average and compared to our peers.This high turnover rate requires us to spend significantresources recru
326、iting a substantial number of drivers in order to operate existing revenue equipment andsubjects us to a higher degree of risk with respect to driver shortages than our competitors.Our use ofteam-driven tractors in our expedited service offering requires two drivers per tractor,which furtherincrease
327、s the number of drivers we must recruit and retain in comparison to operations that require onedriver per tractor.Our driver hiring standards,including hair follicle drug testing,could further reducethe pool of available drivers from which we would hire.If we are unable to continue to attract and re
328、taina sufficient number of drivers,we could be forced to,among other things,continue to adjust ourcompensation packages or operate with fewer tractors and face difficulty meeting shipper demands,either of which could materially adversely affect our growth and profitability.Our engagement of independ
329、ent contractors to provide a portion of our capacity exposes us todifferent risks than we face with our tractors driven by company drivers.As independent business owners,independent contractors may make business or personal decisions thatmay conflict with our best interests such as denying loads of
330、freight from time to time.Additionally,independent contractors may be unable to obtain or retain equipment financing,which could affect theirability to continue to act as a third-party service provider for the Company.In these circumstances,wemust be able to deliver the freight timely in order to ma
331、intain relationships with customers,and if wefail to meet certain customer needs or incur increased expenses to do so,this could materially adverselyaffect our relationship with customers and our results of operations.Our contracts with independent contractors are governed by the federal leasing reg
332、ulations,whichimpose specific requirements on us and the independent contractors.If more stringent federal leasingregulations are adopted,independent contractors could be deterred from becoming independentcontractor drivers,which could materially adversely affect our goal of maintaining our current
333、fleetlevels of independent contractors.2025/1/18 08:34sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htmhttps:/www.sec.gov/Archives/edgar/data/923571/000155837022002527/usx-20211231x10k.htm38/155Page 21We provide financing to certain qualified independent contractors.If we are unable to provide suchfinancing in the future,due to liquidity constraints or other restrictions,w
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