Radiant Logistics, Inc DEF 14A, filed Oct 6, 2023
Radiant Logistics, Inc (RLGT)
About this DEF 14A
Radiant Logistics, Inc filed this DEF 14A on October 6, 2023.
INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant Filed by a Party other than the Registrant
Check the appropriate box:
|
|
Preliminary Proxy Statement |
|
|
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
|
|
Definitive Proxy Statement |
|
|
Definitive Additional Materials |
|
|
Soliciting Material under §240.14a-12 |
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check all boxes that apply):
|
|
No fee required. |
|
|
Fee paid previously with preliminary materials. |
|
|
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11. |
2023
Notice of Annual
Meeting of Stockholders
and Proxy Statement
Wednesday, November 15, 2023
9:00 a.m., Local Time
Triton Towers Two
700 S. Renton Village Place, Seventh Floor
Renton, Washington 98057
(This page left blank intentionally)
Triton Towers Two
700 S. Renton Village Place, Seventh Floor
Renton, Washington 98057
FROM OUR CHAIRMAN OF THE BOARD
Dear Stockholder:
The 2023 Annual Meeting of Stockholders will be held at our principal executive offices located at Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, at 9:00 a.m., Local Time, on Wednesday, November 15, 2023.
In connection with the Annual Meeting, stockholders will be asked to consider and vote upon the following proposals: (1) to elect four directors to serve for the ensuing year as members of the Board of Directors of Radiant Logistics, Inc.; (2) to ratify the appointment of Moss Adams LLP, as our independent registered public accounting firm for the fiscal year ending June 30, 2024; (3) to approve, on an advisory basis, our executive compensation; and (4) to transact such other business as may properly come before the Annual Meeting or at any continuation, postponement, or adjournment thereof. The accompanying Notice of 2023 Annual Meeting of Stockholders and proxy statement describe these matters in more detail. We urge you to read this information carefully.
The Board of Directors recommends a vote: FOR each of the four nominees for director named in the proxy statement and FOR the approval of the other proposals being submitted to a vote of stockholders.
Voting your shares of Radiant Logistics common stock is easily achieved without the need to attend the Annual Meeting in person. Regardless of the number of shares of Radiant Logistics common stock that you own, it is important that your shares be represented and voted at the Annual Meeting. Therefore, I urge you to vote your shares of Radiant Logistics common stock via the Internet, by telephone, or by promptly marking, dating, signing, and returning the proxy card. Voting over the Internet, by telephone, or by written proxy will ensure that your shares are represented at the Annual Meeting.
On behalf of the Board of Directors and management of Radiant Logistics, we thank you for your participation and continued support.
Sincerely,
Bohn H. Crain
Chairman of the Board and Chief Executive Officer
October 6, 2023
You can help us make a difference by eliminating paper proxy materials. With your consent, we will provide all future proxy materials electronically. Instructions for consenting to electronic delivery can be found on your proxy card or at www.proxyvote.com. Your consent to receive stockholder materials electronically will remain in effect until canceled. |
Radiant Logistics, Inc. – 2023 Proxy Statement 1
NOTICE OF 2023 ANNUAL MEETING OF STOCKHOLDERS
The 2023 Annual Meeting of Stockholders of Radiant Logistics, Inc., a Delaware corporation, will be held on November 15, 2023, at 9:00 a.m., Local Time at our principal executive offices located at Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, for the following purposes:
The proxy statement accompanying this Notice describes each of these items of business in detail. Only holders of record of our common stock at the close of business on September 22, 2023 are entitled to notice of, to attend, and to vote at the Annual Meeting or any continuation, postponement, or adjournment thereof. A list of such stockholders will be available for inspection, for any purpose germane to the Annual Meeting, at our principal executive offices during regular business hours for a period of no less than 10 days prior to the Annual Meeting.
To ensure your representation at the Annual Meeting, you are urged to vote your shares of Radiant Logistics common stock via the Internet, by telephone, or by promptly marking, dating, signing, and returning the proxy card. If your shares of Radiant Logistics common stock are held by a bank, broker, or other agent, please follow the instructions from your bank, broker, or other agent to have your shares voted.
BY ORDER OF THE BOARD OF DIRECTORS
Bohn H. Crain
Chairman of the Board and
Chief Executive Officer
Renton, Washington
October 6, 2023
Radiant Logistics, Inc. – 2023 Proxy Statement 2
CONTENTS
Page
4 |
|
OUR COMMITMENT TO ENVIRONMENTAL, SOCIAL AND GOVERNANCE PRINCIPLES |
9 |
11 |
|
23 |
|
25 |
|
PROPOSAL NO. 2: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
28 |
31 |
|
34 |
|
49 |
|
49 |
|
57 |
|
60 |
|
61 |
|
62 |
|
64 |
|
68 |
|
72 |
_____________________
References in this proxy statement to:
Information on our website and any other website referenced herein is not incorporated by reference into, and does not constitute a part of, this proxy statement.
™ and ® denote trademarks and registered trademarks of Radiant Logistics, Inc. or our affiliates, registered as indicated in the United States. All other trademarks and trade names referred to in this release are the property of their respective owners.
We intend to make this proxy statement and our 2023 Annual Report available online and to commence mailing of the notice to all stockholders entitled to vote at the Annual Meeting beginning on or about October 6, 2023. We will mail paper copies of these materials, together with a proxy card, within three business days of a request properly made by a stockholder entitled to vote at the 2023 Annual Meeting of Stockholders.
Radiant Logistics, Inc. – 2023 Proxy Statement 3
PROXY STATEMENT SUMMARY
This executive summary provides an overview of the information included in this proxy statement. We recommend that you review the entire proxy statement and our 2023 Annual Report to Stockholders before voting. |
2023 ANNUAL MEETING OF STOCKHOLDERS
DATE AND TIME Wednesday, November 15, 2023 9:00 a.m., Local Time
LOCATION Radiant Logistics, Inc. Principal Executive Offices Triton Towers Two 700 S. Renton Village Place, Seventh Floor Renton, Washington 98057
RECORD DATE Holders of record of our common stock at the close of business on September 22, 2023, are entitled to notice of, to attend, and to vote at the 2023 Annual Meeting of Stockholders or any continuation, postponement, or adjournment thereof. |
VOTING ITEMS |
|
|
Proposal |
Board’s Vote Recommendation |
Page |
|
Proposal No. 1: Election of directors |
FOR |
25 |
|
Proposal No. 2: Ratification of appointment of independent registered public accounting firm |
FOR |
28 |
|
Proposal No. 3: Advisory vote on executive compensation |
FOR |
31 |
|
|
|
|
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be held on Wednesday, November 15, 2023 This proxy statement and our 2023 Annual Report of Stockholders are available online, free of charge, at www.proxyvote.com. On this website, you will be able to access this proxy statement, our 2023 Annual Report, and any amendments or supplements to these materials that are required to be furnished to stockholders. We encourage you to access and review all of the important information contained in the proxy materials before voting. |
Radiant Logistics, Inc. – 2023 Proxy Statement 4
Fiscal year 2023 BUSINESS HIGHLIGHTS
FINANCIAL
$1,085.5 million |
Revenues Achieved $1,085.5 million in total revenues, a 25.6%↓ year-over-year |
$283.8 million |
Non-GAAP Adjusted Gross Profit Achieved $283.8 million in non-GAAP adjusted gross profit, a 7.3%↓ year-over-year |
$20.6 million |
Net Income Achieved net income of $20.6 million, a 53.7%↓ year-over-year, or $0.43 per basic and $0.42 per fully diluted share |
$39.3 million |
Non-GAAP Adjusted Net Income Achieved non-GAAP adjusted net income of $39.3 million, a 32.5%↓ year-over-year, or $0.82 per basic and $0.79 per fully diluted share |
$55.6 million |
Non-GAAP Adjusted EBITDA and Adjusted EBITDA Margin Achieved non-GAAP adjusted EBITDA of $55.6 million, a 31.3%↓ year-over-year, and non-GAAP adjusted EBITDA Margin of 19.6%, ↓680 basis points year-over-year |
OPERATIONAL
|
Strong Network of Company-Owned Locations and Strategic Operating Partners Maintains a strong network of over 25 company-owned locations and over 100 strategic operating partners (independent agents) in the United States and Canada as well as additional global partners to facilitate international shipments |
|
Compelling Multi-Modal Service Offering Continues to build out a strong compelling multi-modal service offering, leveraging our technology and bundling value-added logistics solutions with our core transportation service offerings |
|
Highly Diversified Customer Base Cultivates significant long-standing customer relationships across the platform, with no one customer representing more than 5% of our revenues |
STRATEGIC
$2.2 million |
2023 Investment in Robust and Advanced Technology Offerings and Platform Provides robust and advanced technology offerings to our customers, our company-owned locations, strategic operating partners, and to support corporate and finance operations. During fiscal year 2023, we invested over $2.2 million on technology enhancements and software systems to increase our operating efficiency and improve technology offerings. |
21 acquisitions |
Proven Growth Platform Continues to deliver profitable growth with a track record of executing and integrating 21 acquisitions since our inception in 2006. |
|
|
Annex I provides reconciliations of non-GAAP financial measures to most comparable U.S. GAAP measures. |
Radiant Logistics, Inc. – 2023 Proxy Statement 5
CORPORATE GOVERNANCE
HIGHLIGHTS
|
Three-quarters of directors are independent |
|
Annual say-on-pay vote |
|
Annual election of all directors |
|
Officer and director stock ownership and retention requirements |
|
Majority vote standard for uncontested director elections, with a director resignation policy |
|
Prohibitions on hedging, pledging, and stock option repricing |
|
Emphasis on diversity in Board refreshment efforts |
|
Double trigger change of control arrangements |
|
Independent lead director |
|
Robust clawback policy |
|
Board oversight of ESG policies |
|
No poison pill |
|
Robust Board and committee evaluations |
|
Single class of stock |
STOCKHOLDER ENGAGEMENT
We are committed to a robust and proactive stockholder engagement program. The Board of Directors values the perspectives of our stockholders, and feedback from stockholders on our business, corporate governance, executive compensation, and sustainability practices are important considerations for Board discussions throughout the year.
During fiscal year 2023, our Board reached out to 23 of our largest institutional investors. Stockholder feedback is thoughtfully considered and has led to modifications in our executive compensation program, governance practices and disclosures. Some of the actions we have taken in response to feedback over the last several years are described below.
What We Heard |
What We Did |
Align the interest of executive officers with those of stockholders |
We adopted stock ownership and retention guidelines applicable to our NEOs to ensure that their interests would be closely aligned with those of our stockholders. All of our NEOs are in compliance with our guidelines. We also have adopted an anti-hedging/pledging policy. Our founder and CEO owns approximately 21.3% of our outstanding common stock. |
Emphasize long-term performance-based incentives |
Beginning in fiscal year 2022, we revised our Long-Term Incentive Program (LTIP) to provide for new performance unit awards which will vest based upon achievement of a combination of company and individual performance goals as measured over a three-year period. The performance unit awards are in addition to our restricted stock unit awards which are granted on an annual basis and are determined based, in large part, on the achievement of annual company and individual performance goals, and once granted do not vest until the three-year anniversary of the grant date. The performance unit awards constitute at least 70% our CEO’s target LTIP opportunity for fiscal year 2023. |
Radiant Logistics, Inc. – 2023 Proxy Statement 6
Increase disclosure on executive compensation |
As a smaller reporting company, we were not required to include a Compensation Discussion and Analysis section in our proxy statement nor the more extensive executive compensation tables. Starting in 2021, in response to stockholder feedback, we substantially increased and improved our executive compensation disclosure in this proxy statement, with an eye towards transparency despite the fact that we are not required to provide these disclosures. |
Ensure the recovery of incentive compensation based on incorrect calculations that resulted in a financial restatement |
In September 2021, we adopted a separate and more robust clawback policy covering cash and equity incentive compensation applicable to current and former executives. |
Perform a compensation risk assessment |
As a smaller reporting company, we were not required to perform a compensation risk assessment. Starting in 2021, in response to stockholder feedback, we performed a compensation risk assessment which concluded that our compensation policies, practices and programs, along with our governance structure, work together in a manner so as to encourage our executives (and employees) to pursue growth strategies that emphasize stockholder value creation, but not to take unnecessary or excessive risks that could threaten the value of our Company. |
Disclose CEO pay ratio |
As a smaller reporting company, we were not required to disclose a CEO pay ratio. Starting in 2021, in response to stockholder feedback, we calculated and disclosed a CEO pay ratio in accordance with SEC rules and regulations under “—CEO Pay Ratio”. |
Adopt or disclose an anti-hedging/pledging policy |
We have increased substantially our disclosure of our anti-hedging/pledging policy in this proxy statement. |
Adopt a no tax gross-up policy |
In September 2021, we adopted a new tax gross-up policy that prohibits tax gross-ups, other than the grandfathered provision in the employment agreement of our founder and CEO. |
Increase board diversity |
We added Ms. Kristin E. Toth to the Board of Directors effective June 3, 2021. |
Formalized a Lead Independent Director role to the board |
Our Board designated the Chairman of the Company’s Audit Executive and Oversight Committee as the Company’s Lead Independent Director to formalize the position and to further enhance the Company’s corporate governance practices, which already include a majority of independent directors. |
Provide more robust disclosure regarding ESG efforts |
We have increased our disclosure regarding our ESG efforts in this proxy statement and our Annual Report on Form 10-K. |
Radiant Logistics, Inc. – 2023 Proxy Statement 7
BOARD NOMINEES
Below are the directors nominated for election by stockholders at the Annual Meeting for a one-year term. The Board recommends a vote “FOR” each of these nominees.
Director |
Age |
Serving Since |
Independent |
Committees |
Other Public Boards |
Bohn H. Crain |
59 |
2005 |
No(1) |
— |
— |
Richard P. Palmieri |
70 |
2014 |
Yes |
Audit and Executive Oversight Committee |
— |
Michael Gould |
59 |
2016 |
Yes |
Audit and Executive Oversight Committee |
— |
Kristin E. Toth |
48 |
2021 |
Yes |
Audit and Executive Oversight Committee |
— |
KEY QUALIFICATIONS
The following are some of the key qualifications, skills, and experiences of our Board nominees.
Director |
CEO/Senior Officer Experience |
Financial/Finance Experience |
Industry Experience |
Technology and |
Corporate Governance |
Bohn H. Crain |
● |
● |
● |
|
|
Richard P. Palmieri |
● |
● |
|
|
● |
Michael Gould |
● |
|
● |
● |
|
Kristin E. Toth |
● |
|
● |
● |
|
The lack of a mark for a particular item does not mean that the director does not possess that qualification, characteristic, skill, or experience. We look to each director to be knowledgeable in these areas; however, the mark indicates that the item is a particularly prominent qualification, characteristic, skill, or experience that the director brings to the Board.
EXECUTIVE COMPENSATION BEST PRACTICES
Our compensation practices include many best pay practices that support our executive compensation objectives and principles and benefit our stockholders.
|
What We Do |
|
What We Don’t Do |
|
Maintain a competitive compensation package |
|
No guaranteed salary increases or bonuses |
|
Structure our executive officer compensation so that a significant portion of pay is at risk |
|
No excessive perquisites |
|
Emphasize long-term performance in our equity-based incentive awards |
|
No repricing of stock options unless approved by stockholders |
|
Maintain a robust clawback policy |
|
No pledging of Radiant securities |
|
Require a double-trigger for equity acceleration upon a change of control |
|
No short sales or derivative transactions in Radiant stock, including hedges |
|
Have robust stock ownership and retention guidelines |
|
No current payment of dividends on unvested awards |
|
Hold an annual say-on-pay vote |
|
No excise or other tax gross-ups (other than the grandfathered arrangement with our founder and CEO) |
Radiant Logistics, Inc. – 2023 Proxy Statement 8
2024 ANNUAL MEETING OF STOCKHOLDERS
Date of 2024 Annual Meeting of Stockholders
We anticipate that our 2024 Annual Meeting of Stockholders will be held on or about Wednesday, November 13, 2024.
Important Dates for Stockholder Submissions
The following are important dates in connection with our 2024 Annual Meeting of Stockholders.
Stockholder Action |
Submission Deadline |
Proposal Pursuant to Rule 14a-8 of the Securities Exchange Act of 1934 |
No later than June 8, 2024 |
Nomination of a Candidate Pursuant to our Bylaws and Rule 14a-19 of the Securities Exchange Act of 1934 |
Between August 15, 2024 and September 14, 2024 |
Proposal of Other Business for Consideration Pursuant to our Bylaws |
Between August 30, 2024 and September 24, 2024 |
OUR COMMITMENT TO ENVIRONMENTAL, SOCIAL, AND GOVERNANCE PRINCIPLES
OUR esg STORY
The Board continues to deepen its commitment to Environmental, Social, and Governance (ESG) values. In fiscal year 2023, Radiant further enhanced and consolidated our efforts to accelerate programs related to Climate Change and Greenhouse Gas Emissions; Inclusion (DEI); as well as community action and good corporate citizenship.
We continue to take great pride in our work that supports humanitarian and relief related projects around the globe for both humanitarian and governmental agencies. This work has included the transportation of medical equipment, MREs and construction supplies; we have transported search and rescue equipment, generators, hygiene supplies, and bottled water across the world for those areas affected by natural disasters including to Guam, Turkey, and Hawaii. Concurrently, we have also expanded our social responsibility initiatives to include the launching of a long-term partnership with the American Heart Association. In addition, we have continued to seek partnerships with organizations who are actively committed to the goal of lifting up local communities.
We have progressed our internal environmental initiatives, including our technology recycling program; paper recycling program at corporate headquarters; public transport incentive program for corporate employees; remote hybrid working options to reduce emissions from commuting and power-saving initiatives to reduce electricity consumption and single-use containers. Radiant remains a long-term member of the SmartWay® Transport Partnership and is also exploring other member and partnerships that are focused on the reduction of our collective environmental footprint.
In fiscal year 2023, Radiant further expanded our ESG & Sustainability team. Our ESG Steering Committee continues to meet at least biweekly and we have launched a Radiant ESG Task Force: a working group that includes both operational and administrative representatives from across our business. These groups together will lead the charge for the future success in our environmental, social, and overall governance related endeavors. Radiant has likewise continued to work with an external ESG consultant as we further explore our alignment with the Task Force on Climate-related Financial Disclosures (TCFD) as well as the Sustainability Accounting Standards Board (SASB) and in the areas of climate and greenhouse gas emissions, similar alignment with the Science Based Target initiative (SBTi).
Radiant Logistics, Inc. – 2023 Proxy Statement 9
As part of our work with both our Steering Committee and external ESG consultant, and as a result of our initial risk assessment in 2022, we have developed a preliminary blueprint from which to expand and build programs that prioritize ways to mitigate ESG-related risks and support ESG-related opportunities. These programs focus on:
A Note on ESG and Climate Change Effects
At Radiant, we recognize the importance of addressing climate-related risks and opportunities to ensure our business is resilient and sustainable for the future. In 2023 we have continued in our efforts to further align with the TCFD framework and their four pillars of Governance Framework, Risk Management, Strategic Planning and Metrics and Targets. We have already begun to collect data to inform future strategy as well as our disclosures. While as a function of Radiant’s asset-light based business model and strategy, we do not anticipate that the risks associated will climate change will have a material financial impact on our business, we recognize that we must work to reduce our emissions across the organization.
In fiscal year 2023, we have begun an initial carbon inventory to better inform our greenhouse gasses (GHG) initiatives, which we expect to complete in the coming months. As we continue to work through and develop best practices in minimizing the negative effects of our industry on the environment, we intend to (1) report on our data in relation to greenhouse gas emissions, (2) execute on both an Environmental Management Policy and a Sustainable Procurement Policy, and (3) establish targets for reduction of GHG emissions and our carbon footprint, with consideration to SBTi alignment. Following the completion of our carbon inventory, we also intend to subsequently publish a full TCFD-aligned report, which will be available online at www.radiantdelivers.com. Highlights of our progress are included below.
|
Complete |
In Progress |
For 2024 & Beyond |
Governance |
• Radiant has undertaken to integrate sustainability & climate related matters into our corporate governance, making ESG risks & opportunities a regular agenda item in quarterly meetings. • An independent board member has been responsible for sustainability/ESG in tandem with an internal management liaison since 2022 • We continue to evaluate areas of opportunity to improve the integration of ESG into our governance and decision making process. |
• The Radiant ESG Steering Committee continues to establish learning pathways for the organization as a whole, data collection processes and metrics, as well as a cadence of risk and opportunity assessment that engages with all leaders of senior management. • Radiant has further engaged the expertise of key members within the organization with the preliminary development of an Radiant ESG Task Force. |
• The ESG Task Force will meet monthly to ensure our climate-related initiatives continue to align seamlessly with our business strategy and overarching corporate goals. • Radiant will continue to further integrate ESG into company policies and extended working groups. |
Risk Management |
• Climate-related risks are being identified and assessed by our ESG Steering Committee with oversight |
• Climate-related risks are reviewed and discussed initially via our ESG Steering Committee and moving |
• While discussed at the committee level, these risks will still be considered within the TCFD framework and in conjunction |
Radiant Logistics, Inc. – 2023 Proxy Statement 10
|
for data acquisition, measurement and evaluation. • The ESG Steering Committee continues to report on at least a quarterly basis to both the CEO & Board of Directors in these areas. |
forward in conjunction with our ESG Taskforce.
|
with our ERM Framework at the Board level and with our overall Business Continuity Plan in mind. |
Strategic Planning |
• Radiant began its initial assessment of climate related risks and opportunities in 2022 • Throughout 2023 we have further developed relationships with vendors and partners who share the core value that we are all responsible for climate-related challenges.
|
• We have continued to identify & evaluate and formalize those short, medium and long term risks & opportunities, with the understanding that this is a changing model that must account for a dynamic market. • We have continued to engage with customers and vendors to ensure we are aware of developments in climate related risks and opportunities and other sustainability measures. |
As a climate-related opportunity, we see our core commitment to our customers as an emerging opportunity on multiple fronts: 1. helping customers to manage increased complexity from carbon taxes and emissions reporting requirements 2. meeting the shifting demand for decarbonized logistics services including intermodal and other eco-friendly transportation and logistics solutions 3. Supporting government agencies, NGOs and other partners |
Metrics & Targets
|
We have explored Scope 1, 2 and 3 emissions and how to best align with the TCFD as well as science based emissions targets. |
We are currently focusing on the data collection to establish our Scope 1 & 2 greenhouse gas emissions |
• We will continue to evaluate programs that will help to reduce our overall impact as a company on the environment • Once we have concluded our baseline measurements, we intend to establish formal targets to measure our performance against. |
Ultimately, we believe progress on our ESG initiatives will have a positive impact on our stockholders, consumers, customers, our talented worldwide associates and the communities in which we are proud to live and work.
CORPORATE GOVERNANCE
best PRACTICES
We have adopted several corporate governance best practices, which are designed to promote actions that benefit our stockholders and create a framework for our decision-making.
Annual election of all directors |
All directors are elected annually for a one-year term. |
Majority vote standard for uncontested director elections, with a director resignation policy |
We have a majority voting standard for uncontested director elections, and directors who do not receive more votes “for” than “against” their election must offer to resign from the Board. |
Three-quarters of our directors are independent |
Three of the four directors on our Board are independent. |
Robust Board and committee evaluations |
Our Board and committees conduct annual performance self-evaluations. |
No poison pill |
We believe that not having a poison pill benefits our stockholders by not discouraging takeover attempts that may increase value for our stockholders. |
Radiant Logistics, Inc. – 2023 Proxy Statement 11
Board oversight of ESG initiatives |
The Audit and Executive Oversight Committee has been delegated oversight authority of our ESG initiatives. |
Emphasis on gender and racial/ethnic diversity in Board |
Effective June 3, 2021, the Board added a female director to the Board. In addition, our Chairman and CEO is a Native American Indian. As a result, half of our Board is diverse based on gender and racial/ethnic diversity. |
Robust stockholder outreach program |
Our executives hold numerous meetings primarily with institutional investors to seek stockholder input and strive to take actions that reflect the input received. |
Officer and director stock ownership and retention requirements |
We have robust stock ownership and retention guidelines for our directors and officers that require maintenance of a specified level of ownership based on compensation. |
Hedging, pledging, and stock option repricing prohibitions |
We prohibit certain employees, including our NEOs, from engaging in any hedging transactions, short sales, transactions in publicly traded options, such as puts, calls and other derivatives, or short-term trading. |
Require a double trigger for cash severance and accelerated vesting of equity upon a change of control |
The double trigger feature incentivizes executives to accept or continue employment with Radiant Logistics in the event of a change of control event. |
Robust clawback policy |
We maintain a robust clawback policy pursuant to which we may recover cash and equity incentive compensation from current or former officers in the event of a restatement. |
Single class of stock |
We have a single class of stock, so our stockholders all have equal voting rights. |
GUIDELINES
The Board has adopted Corporate Governance Principles covering, among other things, the duties and responsibilities of, and independence standards applicable to, our directors and Board committee structures and responsibilities. Among the topics addressed in our Corporate Governance Guidelines are:
1. Role of directors 2. Selection of the Chairman of the Board 3. Selection of new directors 4. Director qualifications 5. Other directorships 6. Director independence 7. Directors who change their present job responsibility 8. Retirement and resignation policy 9. Board compensation 10. Separate sessions of independent directors 11. Board and Board committee self-evaluations 12. Strategic direction of the Company 13. Board access to management 14. Succession planning 15. Management development |
16. Board materials 17. Board interaction with institutional investors, analysts, press, and customers 18. Board orientation and continuing education 19. Director attendance at annual meetings of stockholders 20. Frequency of meetings 21. Selection of agenda items for Board meetings 22. Number and names of Board committees 23. Independence of Board committees 24. Assignment and rotation of committee members 25. Evaluation of Board committee charters 26. Evaluation of executive officers 27. Risk management 28. Prohibited loans 29. Communications with directors |
From time to time, the Board, upon recommendation of the Audit and Executive Oversight Committee, reviews and updates the Corporate Governance Guidelines as it deems necessary and appropriate. The Corporate Governance Guidelines are available in the “Investors—Corporate Governance—Governance Documents” section of the Company’s website located at About – Radiant Global Logistics (radiantdelivers.com).
Radiant Logistics, Inc. – 2023 Proxy Statement 12
MAJORITY VOTE STANDARD AND RESIGNATION POLICY
Our Bylaws provide for a majority vote standard for uncontested director elections. Director nominees will be elected by a majority of the votes cast. A “majority of the votes cast” means that the number of votes cast “for” a director nominee exceeds the number of votes cast “against” such director nominee, with “abstentions” and “broker non-votes” not counted as a vote cast either “for” or “against” that nominee’s election. However, director nominees will be elected by a plurality of the votes cast in connection with a contested election, as defined in our Bylaws.
Pursuant to our Corporate Governance Guidelines, any incumbent director who is not elected to the Board in accordance with the Bylaws shall promptly tender a written offer of resignation as a director. The Nominating and Corporate Governance Committee will recommend to the Board whether to accept or reject the director’s resignation offer or take other action, and the Board will take action with respect to the offer no later than 90 days following certification of the election results and will publicly disclose its decision regarding the director’s resignation offer, if applicable, promptly thereafter. Any director whose resignation offer is under consideration will abstain from participating in any decision regarding that resignation offer.
Director Independence
Under the NYSE American continued listing standards, independent directors must comprise a majority of a listed company’s board of directors. In addition, the NYSE American continued listing standards require that, subject to specified exceptions, each member of a listed company’s audit, compensation, and nominating and corporate governance committees be independent. Audit committee members must also satisfy heightened independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934 (Exchange Act), and compensation committee members must satisfy heightened independence criteria set forth in the NYSE American rules. Under the NYSE American rules, a director will only qualify as an “independent director” if the company’s board of directors affirmatively determines that the director has no material relationship with the company, either directly or indirectly, that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
The Board has undertaken a review of its composition, the composition of its Board committees, and the independence of each director. Based upon information requested from and provided by each of our directors concerning his or her background, employment, and affiliations, including family relationships with us, our senior management, and our independent registered public accounting firm, the Board has determined that all but one of our directors, Bohn H. Crain, are independent directors under the standards established by the Securities and Exchange Commission (SEC) and the NYSE American. In making this determination, the Board considered the current and prior relationships that each non-employee director has with Radiant Logistics and all other facts and circumstances the Board deemed relevant in determining their independence.
Board Leadership Structure
The Board does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as the Board believes it is in the best interests of the Company to make that determination based on the position and direction of the Company and the membership of the Board. The Board has determined that having our founder and Chief Executive Officer serve as Chairman is in the best interest of our stockholders at this time. We believe this structure makes the best use of the Chief Executive Officer’s extensive knowledge of the Company and its industry, as well as fostering greater communication between our management and the Board.
Radiant Logistics, Inc. – 2023 Proxy Statement 13
We have adopted a counterbalancing governance structure to protect the interests of our stockholders by preventing the Board from being unduly influenced by the combination of these positions. Effective as of our 2021 Annual Meeting, the Board designated Richard P. Palmieri, the Chairman of the Company’s Audit Executive and Oversight Committee, as the Company’s Lead Independent Director to formalize the position and to further enhance the Company’s corporate governance practices. The Lead Independent Director’s primary responsibility is to ensure that the Board functions independent of management and acts as principal liaison between the independent directors and the non-independent directors and the Chief Executive Officer. The lead independent director presides at executive sessions of our independent directors, as well as performs other duties applicable to that position including, among other things, providing guidance to the Chairman regarding agendas for Board and committee meetings, advising the Chair as to the information to be provided the Board for its meetings, chairing meetings of the Board in the event the Chairman cannot be in attendance, and acting as principal liaison between the independent directors and the Chair. The lead independent director is expected to foster a cohesive board that cooperates with the Chairman towards the ultimate goal of creating stockholder value and leads our stockholder engagement efforts.
The Board believes that the most effective board structure is one that emphasizes board independence and ensures that the board’s deliberations are not dominated by management. Three out of the four directors on the Board are independent, and our Audit and Executive Oversight Committee is composed entirely of independent directors. In support of the independent oversight of management, the independent directors meet and hold discussions without management present.
Management is responsible for the Company’s day-to-day risk management and the Board’s responsibility is to engage in informed oversight of and provide overall direction with respect to such risk management. Our Board administers its risk oversight function directly and through our Audit and Executive Oversight Committee, which includes regular meetings with management to discuss, identify and mitigate potential areas of risk. Our Board’s approach to risk management is to focus on understanding the nature of our enterprise risks, to support the achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance stockholder value, while at the same time overseeing an appropriate level of risk for the Company. We believe our current board leadership structure helps ensure proper risk oversight, based on the allocation of duties among committees and the role of our independent directors in risk oversight.
Executive Sessions
Our non-management independent directors meet in executive sessions without management to consider such matters as they deem appropriate, such as reviewing the performance of management. Executive sessions of our independent directors are typically held in conjunction with regularly scheduled Board meetings.
Committees of the Board of Directors
We currently have one standing committee of the Board, the Audit and Executive Oversight Committee, which was formed in 2012. The Board may establish other Board committees as it deems necessary or appropriate from time to time.
Below are our directors, their committee memberships and their fiscal year 2023 attendance rates for Board meetings.
Director |
Board |
Audit and Executive Oversight Governance |
Board Meeting Attendance Rate |
Bohn H. Crain |
● |
|
100% |
Richard P. Palmieri |
● |
Chair |
100% |
Michael Gould |
● |
● |
100% |
Kristin E. Toth |
● |
● |
100% |
Audit and executive oversight committee
The standing committee of the Board of Directors is the Audit and Executive Oversight Committee, which was formed in 2012. The Audit and Executive Oversight Committee fulfills the consolidated oversight functions typically associated with audit, compensation and nominating and governance committee.
Radiant Logistics, Inc. – 2023 Proxy Statement 14
The Audit and Executive Oversight Committee operates under a written charter that is reviewed annually. In September 2021, the Board of Directors amended and restated the Company’s Audit and Executive Oversight Committee Charter to reflect the restructuring of the roles of authority granted to each member of the Audit and Executive Oversight Committee and to include the oversight of the development and implementation of corporate governance policies for the Company. The amended and restated Charter is available on our website at www.radiantdelivers.com.
The Audit and Executive Oversight Committee held five formal meetings during fiscal year 2023. The members of the Audit and Executive Oversight Committee are Messrs. Gould, Palmieri (Chair), and Ms. Toth.
Audit committee Function:
The Audit and Executive Oversight Committee, pursuant to its written charter, among other matters, performs traditional Audit Committee functions and oversees (i) our financial reporting, auditing, and internal control activities; (ii) the integrity and audits of our financial statements; (iii) our compliance with legal and regulatory requirements; (iv) the qualifications and independence of our independent auditors; (v) the performance of our internal audit function and independent auditors; and (vi) our overall risk exposure and management. Richard P. Palmieri is responsible for oversight of the Audit Committee functions of the Audit and Executive Oversight Committee.
Additionally, the Committee:
The Audit and Executive Oversight Committee charter authorizes the Audit and Executive Oversight Committee to retain independent legal, accounting, and other advisors as it deems necessary to carry out its responsibilities. The Audit and Executive Oversight Committee reviews and evaluates, at least annually, the performance of the Audit and Executive Oversight Committee, including compliance with its charter.
Financial Literacy and Financial Experts
The Board has determined that each member of the Audit and Executive Oversight Committee is “financially literate” under the continued listing requirements of the NYSE American and satisfies the heightened independence criteria for audit committee members set forth in Rule 10A-3 under the Exchange Act. As of December 28, 2020, Mr. Palmieri has been designated by the Board as our “audit committee financial expert,” as that term is defined in the rules of the SEC.
Material Weaknesses and Remediation Efforts
As previously reported in our Annual Report on Form 10-K for the year ended June 30, 2023, we concluded that a material weakness existed in our internal control over financial reporting as of June 30, 2021 related to the recording and processing of revenue transactions, including the timing of the Company’s estimated accrual of in-transit revenues and related costs.
Radiant Logistics, Inc. – 2023 Proxy Statement 15
In response to this material weakness, the Company has continued making progress with corrective action during fiscal year 2023 to address the material weakness and provide reasonable assurance that future errors in revenue transactions would be prevented and/or detected in a timely manner. The Company’s corrective actions include, but are not limited to:
As of June 30, 2023, remediation is ongoing. While existing controls have been enhanced, and new controls have been implemented, there is a need for additional enhancements around the design of those controls, including, but not limited to, the formalization of the documentation retained to evidence the performance of these controls. Further testing procedures are also needed to verify their effectiveness over multiple periods of operation.
Separately, as previously reported in our Annual Report on Form 10-K for the year ended June 30, 2023, we concluded that material weaknesses exist surrounding our Information Technology General Controls (“ITGCs”) as of June 30, 2023, specifically relating to change management and user access rights. The material weaknesses related to the ineffective design and operation of ITGCs over the information technology (“IT”) systems supporting the Company’s Transportation Management (“TM”) systems as well as its Enterprise Resource Planning (“ERP”) system.
In response to the material weaknesses, the Company removed certain elevated logical access privileges from user accounts and is actively enhancing existing controls that may include the addition of new controls to further strengthen our technology environment. The Company will need the refined and new controls to operate effectively for a specific period of time before concluding that the material weaknesses have been resolved.
The Audit and Executive Oversight Committee takes its review of the adequacy of our internal accounting controls seriously. In addition to the foregoing remediation efforts, the Audit and Executive Oversight Committee has retained directly, Armanino LLP to provide consulting services to facilitate the remediation efforts of management related to the material weaknesses and has elected to withhold the payment of a portion of bonuses to senior management until there is a resolution of the material weaknesses.
Compensation Committee Function:
We do not have a standing Compensation Committee. The Audit and Executive Oversight Committee fulfills the compensation committee functions. The Audit and Executive Oversight Committee reviews the compensation philosophy, strategy of the Company and consults with the Chief Executive Officer, as needed, regarding the role of our compensation strategy in achieving our objectives and performance goals and the long-term interests of our stockholders. The Audit and Executive Oversight Committee has direct responsibility for approving the compensation of our Chief Executive Officer, and makes recommendations to the Board with respect to our other executive officers. The term “executive officer” has the same meaning specified for the term “officer” in Rule 16a-1(f) under the Securities Exchange Act. Michael Gould is responsible for oversight of the Compensation Committee functions of the Audit and Executive Oversight Committee.
Our Chief Executive Officer sets the compensation for anyone whose compensation is not set by the Board.
The Committee, pursuant to its written charter, among other matters:
Radiant Logistics, Inc. – 2023 Proxy Statement 16
The Audit and Executive Oversight Committee may retain compensation consultants, outside counsel and other advisors as the Board deems appropriate to assist it in discharging its duties.
During fiscal year 2021, the Committee engaged Meridian Compensation Partners to perform an updated executive compensation study, develop an updated a peer group and provide it with guidance regarding the Company’s executive compensation program. Meridian completed the development of a Peer Group listing for Radiant Logistics and then conducted an analysis of our NEO positions compared to similar positions at Peer Group companies. Meridian also conducted an analysis of our Board of Directors compensation compared to the Peer Group companies. This information was used to develop our current compensation programs for Executives and Directors. As well, these trends and this information is being used by the Audit and Executive Oversight Committee to determine whether to make any additional changes to the Company’s overall compensation policies during fiscal year 2023.
During fiscal year 2023, Meridian Compensation Partners did not provide any services to the Company.
The Committee reviews and evaluates, at least annually, the performance of the Committee, including compliance with its charter.
The Board has determined that each of the Committee members satisfies the heightened independence criteria for compensation committee members under the continued listing requirements of the NYSE American. In addition, each of the Committee members is a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act.
nominating and governance committee Function:
We do not have a standing Nominating and Governance Committee. The Audit and Executive Oversight Committee fulfills the nominating and governance committee functions. The Audit and Executive Oversight Committee identifies and recommends to the Board individuals qualified to be nominated for election to the Board and recommends to the Board the members and Chairperson for each Board committee. Kristin E. Toth is responsible for oversight of the Nominating and Governance Committee functions of the Audit and Executive Oversight Committee.
The Committee, pursuant to its written charter, among other matters:
Radiant Logistics, Inc. – 2023 Proxy Statement 17
The Committee charter authorizes the Committee to retain a search firm or other advisors to assist in the identification and evaluation of director candidates, including the sole authority to approve the search firm’s or other advisors’ fees and other retention terms.
The Committee reviews and evaluates, at least annually, the performance of the Committee, including compliance with its charter.
Board and Board Committee Meetings; Attendance
The Board held eleven formal meetings during fiscal year 2023. All directors attended at least 75% of the combined total of (i) all Board meetings and (ii) all meetings of committees of the Board of which the director was a member during fiscal year 2023. Although the Board does not have a formal policy governing director attendance at its annual meeting of stockholders, we expect all of our directors to attend our annual meeting of stockholders, and we customarily schedule a regular Board meeting on the same day as our annual meeting. All directors serving at the time of our 2022 Annual Meeting of Stockholders held on May 23, 2023 attended the meeting either in person or by telephone.
Director QUALIFICATIONS and Nominations Process
The Board seeks to ensure that the Board is composed of members whose particular expertise, experience, qualifications, attributes, and skills, when taken together, will allow the Board to satisfy its oversight responsibilities effectively. We do not have a standing Nominating Committee. The Audit and Executive Oversight Committee fulfills the nominating committee functions. New directors are approved by the Board after recommendation by the Audit and Executive Oversight Committee.
In selecting nominees for director, without regard to the source of the recommendation, the Audit and Executive Oversight Committee believes that each director nominee should be evaluated based on his or her individual merits, taking into account the needs of the Company and the composition of the Board. Members of the Board should have the highest professional and personal ethics, consistent with our values and standards and Code of Ethics. At a minimum, a nominee must possess integrity, skill, leadership ability, financial sophistication, and capacity to help guide us. Nominees should be committed to enhancing stockholder value and should have sufficient time to carry out their duties and to provide insight and practical wisdom based on their experiences. Their service on other boards of public companies should be limited to a number that permits them, given their individual circumstances, to responsibly perform all director duties. In addition, the Audit and Executive Oversight Committee considers all applicable statutory and regulatory requirements and the requirements of any exchange upon which our common stock is listed or to which it may apply in the foreseeable future.
Radiant Logistics, Inc. – 2023 Proxy Statement 18
The Audit and Executive Oversight Committee will typically employ a variety of methods for identifying and evaluating nominees for director. The Audit and Executive Oversight Committee regularly assesses the appropriate size of the Board and whether any vacancies on the Board are expected due to retirement or otherwise. In the event that vacancies are anticipated, or otherwise arise, the Audit and Executive Oversight Committee will consider various potential candidates for director. Candidates may come to the attention of the Audit and Executive Oversight Committee through current directors, stockholders, or other companies or persons. The Audit and Executive Oversight Committee does not evaluate director candidates recommended by stockholders differently than director candidates recommended by other sources. Director candidates may be evaluated at regular or special meetings of the Audit and Executive Oversight Committee and may be considered at any point during the year.
We do not have a formal policy with regard to the consideration of diversity in identifying director nominees, but the Audit and Executive Oversight Committee strives to nominate directors with a variety of complementary skills so that, as a group, the Board will possess the appropriate talent, skills, and expertise to oversee our businesses. In evaluating director nominations, the Audit and Executive Oversight Committee seeks to achieve a balance of knowledge, experience, and capability on the Board. In connection with this evaluation, the Audit and Executive Oversight Committee will make a determination of whether to interview a prospective nominee based upon the Board’s level of interest. If warranted, one or more members of the Audit and Executive Oversight Committee, and others as appropriate, will interview prospective nominees in person or by telephone. After completing this evaluation and any appropriate interviews, the Audit and Executive Oversight Committee will recommend the director nominees after consideration of all its directors’ input. The director nominees are then selected by a majority of the independent directors on the Board, meeting in executive session and considering the Audit and Executive Oversight Committee’s recommendations.
The Company’s Corporate Governance Principles contain a retirement policy that requires no person shall be nominated to the Board to serve as a director after such person’s 74th birthday. The principles are intended to serve as a flexible framework within which the Board may conduct its business.
Ms. Toth was appointed to the Board effective June 3, 2021, upon the recommendation of the Audit and Executive Oversight Committee. Mr. Gould led our search for a new director. The Nominating and Governance Committee functions, including our commitment to environmental, social and governance principles, will be led by Ms. Toth.
In addition to stockholders’ general nominating rights provided in our Bylaws, stockholders may recommend director candidates for consideration by the Board. The Audit and Executive Oversight Committee will consider director candidates recommended by stockholders if the recommendations are sent to the Board in accordance with the procedures for other stockholder proposals described below in this proxy statement under the heading “Stockholder Proposals.” All director nominations submitted by stockholders to the Board for its consideration must include all of the required information set forth in our Bylaws, as summarized under the heading “Stockholder Proposals,” and the following additional information:
During fiscal year 2023, we made no material changes to the procedures by which stockholders may recommend nominees to the Board as described in last year’s proxy statement.
BOARD REFRESHMENT AND BOARD DIVERSITY
The Board of Directors, with support and recommendations from the Audit and Executive Oversight, oversees the succession of its members. To this end, at least once a year, in connection with the annual director nomination and
Radiant Logistics, Inc. – 2023 Proxy Statement 19
re-nomination process, the Audit and Executive Oversight Committee evaluates each director’s performance, relative strengths and weaknesses, and future plans, including any personal retirement objectives and the potential applicability of the Company’s retirement policy for directors, which is set forth in the Company’s Corporate Governance Principles and provides that no person shall be nominated to the Board to serve as a director after such person’s 74th birthday. As part of that evaluation, the Nominating and Corporate Governance Committee also identifies areas of overall strength and weakness with respect to its composition and considers whether the Board of Directors as a whole possesses core competencies in the areas of accounting and finance, industry knowledge, management experience, sales and marketing, strategic vision, executive compensation, and corporate governance, among others.
We value boardroom diversity as integral to effective corporate governance. We believe that board diversity – gender, race, age, insight, background, and professional experience – is a necessity that improves the quality of decision-making and strategic vision, and represents the kind of company we aspire to be. Our Board is representative of a diverse group of backgrounds, viewpoints and ages. The Audit and Executive Oversight Committee, which oversees the function of the Audit, Compensation, and Nominating and Governance Committees, seeks to find director candidates who have demonstrated executive leadership ability and who are representative of the broad scope of stockholder interests.
As a smaller reporting company, we face challenges with recruiting director candidates. In the current climate, candidates who identify as diverse in terms gender or race/ethnicity are highly sought after by public company boards looking to increase their diversity. Larger publicly-traded companies provide these diverse candidates with opportunities for greater visibility and higher compensation. Additionally, many stockholders have policies on the number of publicly-traded boards a director can serve on, further limiting the pool of diverse candidates. Our board is aware of the continued emphasis placed upon board diversity by stockholders and regulatory bodies, and we will continue to monitor and consider trends in the market with respect to our board size and composition.
Below is a summary of our board diversity in terms of age, tenure, race/ethnicity, and gender.
Director |
Title |
Age |
Tenure |
Racial/Ethnic Diversity |
Gender Diversity |
Bohn H. Crain |
Chairman and CEO |
59 |
18 |
Native American |
M |
Richard P. Palmieri |
Independent Director |
70 |
9 |
White/Caucasian |
M |
Michael Gould |
Independent Director |
59 |
7 |
White/Caucasian |
M |
Kristin E. Toth |
Independent Director |
48 |
2 |
White/Caucasian |
F |
Summary |
Independence: 3/4 (75%) |
59 |
8 |
Racial/Ethnic Diversity: 1/4 (25%) |
Gender Diversity: 1/4 (25%) |
MANAGEMENT SUCCESSION Planning and development
The Board of Directors recognizes that one of its most important responsibilities is to ensure excellence and continuity in our senior leadership by overseeing the development of executive talent and planning for the effective succession of our Chief Executive Officer and the other members of our management team. This responsibility is reflected in the Company’s Corporate Governance Principles, which provide for a review of CEO succession planning and management development, and the charter of the Audit and Executive Oversight Committee, which requires the Audit and Executive Oversight Committee to recommend potential candidates for executive officer positions and oversee the development of executive succession plans.
BOARD AND COMMITTEE SELF-EVALUATIONS
The Board recognizes that a thorough evaluation process is an important element of corporate governance and enhances the effectiveness of the full Board and each committee. Therefore, each year, the Audit and Executive Oversight Committee oversees the evaluation process to ensure that the full Board and each committee conduct an assessment of their performance and solicit feedback for areas of improvement.
board Oversight OF BUSINESS STRATEGY
The Board of Directors oversees our strategic direction and business activities. Throughout the year, the Board and management discuss our short and long-term business strategy.
With respect to our short-term strategy, at the beginning of each year, our management presents to the Board a proposed annual business plan for the year and receives input from the Board and a final annual business plan is
Radiant Logistics, Inc. – 2023 Proxy Statement 20
approved by the Board. At each subsequent regular board meeting, the Board reviews our operating and financial performance relative to the annual business plan.
board role in Risk Oversight
Risk is inherent with every business. We face a number of risks, including financial (accounting, credit, interest rate, liquidity, and tax), operational, political, strategic, regulatory, compliance, legal, competitive, and reputational risks.
Management is responsible for the Company’s day-to-day risk management and the Board’s responsibility is to engage in informed oversight of and provide overall direction with respect to such risk management. Our Board administers its risk oversight function directly and through our Audit and Executive Oversight Committee, which includes regular meetings with management to discuss, identify and mitigate potential areas of risk. Our Board’s approach to risk management is to focus on understanding the nature of our enterprise risks, to support the achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance stockholder value, while at the same time oversee an appropriate level of risk for the Company. We believe our current board leadership structure helps ensure proper risk oversight, based on the allocation of duties among committees and the role of our independent directors in risk oversight.
Code of Ethics
The Board has adopted a Code of Ethics that applies to our officers, directors, and employees. Among other matters, our Code of Ethics is designed to deter wrongdoing and to promote the following:
Any waiver of our Code of Ethics for our employees may be made only by our CEO and, with respect to or director or executive officers, our Board of Directors. Any waiver will be promptly disclosed as required by law and continued listing requirements of the NYSE American. We intend to satisfy the disclosure requirements of Item 5.05 of Form 8-K and applicable continued listing requirements of the NYSE American regarding amendments to or waivers from any provision of our Code of Ethics by posting such information in the “About—Governance” section of our website located at www.radiantdelivers.com. Our Code of Ethics is available on our website at www.radiantdelivers.com, and may be obtained without charge upon written request directed to Attn: Human Resources, Radiant Logistics, Inc., Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057.
WHISTLEBLOWER Procedures
We maintain procedures to receive, retain, and treat complaints regarding accounting, internal accounting controls, or auditing matters and to allow for the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters. A 24-hour, toll-free, confidential ethics hotline and a confidential web-based reporting tool are available for the submission of concerns regarding these and other matters by any employee. Concerns and questions received through these methods relating to accounting, internal accounting controls, or auditing matters are promptly brought to the attention of our General Counsel and the Chair of the Audit and Executive Oversight Committee and are handled in accordance with procedures established by the Audit and Executive Oversight Committee. Complete information regarding our complaint procedures is contained within our Code of Ethics, which is described above and may be accessed on our website as noted above.
Radiant Logistics, Inc. – 2023 Proxy Statement 21
STOCKHOLDER ENGAGEMENT
We are committed to a robust and proactive stockholder engagement program. The Board values the perspectives of our stockholders, and feedback from stockholders on our business, corporate governance, executive compensation, and sustainability practices are important considerations for Board discussions throughout the year.
During fiscal year 2023, we reached out to our institutional investors to request meetings to discuss any issues or concerns they may have. We reached out to our top 23 institutional investors as of March 31, 2023, representing 45.4% of our outstanding common stock. This outreach did not include our founder and CEO, who owns 21.3% of our outstanding common stock. Five institutional investors representing 9.7% of our outstanding common stock agreed to engage with us. Stockholder feedback is thoughtfully considered and has led to modifications in our executive compensation program, governance practices and disclosures. Some of the actions we have taken in response to feedback over the last several years are described below.
What We Heard |
What We Did |
Increase stockholder influence over director elections |
In October 2019, we adopted a majority vote standard for uncontested director elections, with a director resignation policy, instead of a plurality vote standard. |
Increase Board diversity |
We added Ms. Kristin E. Toth to the Board of Directors effective June 3, 2021. |
Align the interest of directors and executive officers with those of stockholders |
We adopted stock ownership and retention guidelines applicable to our directors and executives to ensure that their interests would be closely aligned with those of our stockholders. All of our directors and executives are in compliance with our guidelines. We also adopted a more robust anti-hedging/pledging policy. |
Emphasize long-term incentives |
Beginning in fiscal year 2022, we revised our Long-Term Incentive Program (LTIP) to provide for new performance unit awards which will vest based upon achievement of a combination of company and individual performance goals as measured over a three-year period. The performance unit awards are in addition to our restricted stock unit awards which are granted on an annual basis and are determined based, in large part, on the achievement of annual company and individual performance goals, and once granted do not vest until the three-year anniversary of the grant date. The performance unit awards constitute at least 70% of our CEO’s target LTIP opportunity for fiscal year 2023. |
Increase disclosure on executive compensation, including long-term incentives and stock ownership |
We have increased and improved our executive compensation disclosure, with an eye towards transparency and readability. Our Compensation Discussion and Analysis reflects these increased disclosures. |
Ensure the recovery of incentive compensation based on incorrect calculations that resulted in a financial restatement |
In September 2021, we adopted a separate more robust clawback policy covering cash and equity incentive compensation applicable to current and former executives. |
Provide more robust disclosure regarding ESG efforts |
We have increased our disclosure regarding our ESG efforts in this proxy statement. |
Communications with the Board of Directors
The Board maintains a process for stockholders and interested parties to communicate with the Board. Stockholders and interested parties may contact our Board as provided below:
Radiant Logistics, Inc. – 2023 Proxy Statement 22
|
|
|
|
WRITE |
CALL |
ATTEND |
|
Corporate Secretary Radiant Logistics, Inc. Triton Towers Two 700 S. Renton Village Place, Seventh Floor Renton, Washington 98057 |
Investor Relations (425) 943-4541 |
tmacomber@radiantdelivers.com |
Annual Meeting of Stockholders Wednesday, November 15, 2023 Principal Executive Offices |
Management will initially receive and process communications before forwarding them to the addressee(s). We generally will not forward to the directors a communication that is primarily commercial in nature, relates to an improper or irrelevant topic, or requests general information about the Company.
COMMITTEE CHARTERS AND OTHER INFORMATION
The charter of our standing Board committee, Corporate Governance Principles and Code of Ethics are available in the “About—Governance—Documents” section of our website located at Radiant Global Logistics (radiantdelivers.com). The Board reviews each of these documents on an annual basis. Printed copies of any of these documents are available upon written request to Radiant Logistics, Inc., Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, Attention: Corporate Secretary.
EXECUTIVE OFFICERS
We have four executive officers: Bohn H. Crain, Todd E. Macomber, Arnold Goldstein and John W. Sobba. Below is information regarding our executive officers as of October 6, 2023. There are no family relationships among any of our executive officers or directors.
Name |
Age |
Position with Radiant Logistics |
Bohn H. Crain |
59 |
Chairman of the Board of Directors and Chief Executive Officer |
Todd E. Macomber |
59 |
Senior Vice President and Chief Financial Officer |
Arnold Goldstein |
69 |
Senior Vice President and Chief Commercial Officer |
John W. Sobba |
67 |
Senior Vice President and General Counsel |
Bohn H. Crain, age 59. Mr. Crain founded the company and has served as our Chief Executive Officer and Chairman of our Board of Directors since October 2005. Mr. Crain brings approximately 30 years of industry and capital markets experience in transportation and logistics. Since January 2005, Mr. Crain has served as the Managing Member of Radiant Capital Partners, LLC, an entity he formed to execute a consolidation strategy in the transportation and logistics sector. Prior to founding Radiant, Mr. Crain served as the Executive Vice President and the Chief Financial Officer of Stonepath Group, Inc. from January 2002 until December 2004. In 2001, Mr. Crain served as the Executive Vice President and Chief Financial Officer of Schneider Logistics, Inc., a third-party logistics company, and from 2000 to 2001 he served as the Vice President and Treasurer of Florida East Coast Industries, Inc., a New York Stock Exchange listed company engaged in railroad and real estate businesses. Between 1989 and 2000, Mr. Crain held various vice president and treasury positions for CSX Corp., a Fortune 500 transportation company listed on the New York Stock Exchange, and several of its subsidiaries. Mr. Crain earned a Bachelor of Arts in Business Administration with an emphasis in Accounting from the University of Texas.
Todd E. Macomber, age 59. Mr. Macomber has served as our Senior Vice President and Chief Financial Officer since March 2011, and previously as our Senior Vice President and Chief Accounting Officer since August 2010, and as our Vice President and Corporate Controller since December 2007. Prior to joining us, Mr. Macomber served as Senior Vice President and Chief Financial Officer of Biotrace International, Inc., a subsidiary of Biotrace International PLC, an industrial microbiology company listed on the London Stock Exchange. Mr. Macomber earned a Bachelor of Arts, emphasis in Accounting from Seattle University.
Arnold Goldstein, age 69. Mr. Goldstein has served as our Senior Vice President and Chief Commercial Officer since June 30, 2016. Mr. Goldstein also has significant experience within the transportation industry, having served as Chief
Radiant Logistics, Inc. – 2023 Proxy Statement 23
Operating Officer of Service by Air, which was acquired by the Company in June 2015, and in various leadership roles at Hellman World Wide Logistics from May 2006 to February 2015. Mr. Goldstein earned a Bachelor of Arts in Psychology from the University of Rhode Island and a Master of Business Administration from Bryant University.
John W. Sobba, age 67. Mr. Sobba has served as our Senior Vice President and General Counsel since May 2018. Prior to joining the Company, Mr. Sobba was in a private law practice from 2008 to 2018, handling a number of general commercial, real estate and business matters for clients within the technology, transportation, outdoor gear and apparel industries. Mr. Sobba was in the private practice of law with the law firms of Dorsey & Whitney and later with Foster Pepper, from 2004 through 2008. He earned a Bachelor of Arts degree from the University of Oregon, a Juris Doctor from Seattle University, a Master of Taxation from Boston University and a Master of Business Administration from the University of Washington.
Radiant Logistics, Inc. – 2023 Proxy Statement 24
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
Board Size and Structure
Our Bylaws provide that the Board shall consist of one or more members, with the number to be determined from time to time by the Board. The Board has fixed the number of directors at four, and we currently have four directors serving on the Board. Each director holds office for a term of one-year or until his or her successor is duly elected and qualified, subject to his or her earlier death, resignation, disqualification, or removal.
Current Directors and Board Nominees
The Board currently consists of the following four members:
Bohn H. Crain |
Richard P. Palmieri |
Michael Gould |
Kristin E. Toth |
Based upon the recommendation of the Audit and Executive Oversight Committee, the Board nominated each of our current directors named above for re-election at the Annual Meeting. The Board and the Audit and Executive Oversight Committee believe that these four directors collectively have the expertise, experience, qualifications, attributes, and skills to effectively oversee the management of Radiant Logistics, including a high degree of personal and professional integrity, an ability to exercise sound business judgment on a broad range of issues, sufficient experience and background to have an appreciation of the issues facing Radiant Logistics, a willingness to devote the necessary time to Board duties, a commitment to representing the best interests of Radiant Logistics and our stockholders, and a dedication to enhancing stockholder value. Three of our four directors are independent within our director independence standards, which satisfy the continued listing requirements of the NYSE American for independence.
Each director elected at the Annual Meeting will serve a term until Radiant Logistics’ next annual meeting of stockholders and until his or her successor is duly elected and qualified or until his or her earlier death, resignation, disqualification, or removal. Unless otherwise instructed, the proxy-holders will vote the proxies received by them for the four nominees. If any nominee should become unavailable for election prior to the Annual Meeting, an event that currently is not anticipated by the Board, the proxies will be voted in favor of the election of a substitute nominee or nominees proposed by the Board. Each nominee has agreed to serve if elected, and the Board has no reason to believe that any nominee will be unable to serve.
Information about Director Nominees
Set forth below are the names, ages, and positions of our current directors and director nominees as of October 6, 2023, and biographical information for each nominee. Also below is a summary of the specific qualifications, attributes, skills, expertise and experiences that led the Board to conclude that each nominee should serve on the Board at this time. There are no family relationships among any of our directors or executive officers.
Name |
Age |
Position with the Company |
Bohn H. Crain |
59 |
Chairman of the Board of Directors and Chief Executive Officer |
Richard P. Palmieri |
70 |
Lead Independent Director |
Michael Gould |
59 |
Independent Director |
Kristin E. Toth |
48 |
Independent Director |
Radiant Logistics, Inc. – 2023 Proxy Statement 25
Bohn H. Crain, age 59. Mr. Crain has served as our Chief Executive Officer and Chairman of our Board of Directors since October 2005. Mr. Crain brings approximately 25 years of industry and capital markets experience in transportation and logistics. Since January 2005, Mr. Crain has served as the Managing Member of Radiant Capital Partners, LLC, an entity he formed to execute a consolidation strategy in the transportation and logistics sector. Prior to founding Radiant, Mr. Crain served as the Executive Vice President and the Chief Financial Officer of Stonepath Group, Inc. from January 2002 until December 2004. In 2001, Mr. Crain served as the Executive Vice President and Chief Financial Officer of Schneider Logistics, Inc., a third-party logistics company, and from 2000 to 2001 he served as the Vice President and Treasurer of Florida East Coast Industries, Inc., a New York Stock Exchange listed company engaged in railroad and real estate businesses. Between 1989 and 2000, Mr. Crain held various vice president and treasury positions for CSX Corp., a Fortune 500 transportation company listed on the New York Stock Exchange, and several of its subsidiaries. Mr. Crain earned a Bachelor of Arts in Business Administration with an emphasis in Accounting from the University of Texas. As a result of these and other professional experiences, Mr. Crain possesses particular knowledge and experience in logistics management, industry trends, business operations and accounting that strengthen the Board’s collective qualifications, skills, and experience.
Richard P. Palmieri, age 70. Mr. Palmieri was appointed as a director in March 2014. He has been the Managing Partner of ANR Partners, LLC, a management and financial consulting firm, since 2012. Prior to this, from 2007 to 2012, Mr. Palmieri served as the President of Canon Financial Services, Inc., the captive finance subsidiary of Canon USA. From 2003 to 2006, he was the President of Schneider Financial Services, a financial services subsidiary of a large, privately held transportation and logistics company. From 1998 to 2003, he served as a Managing Director and co-head of the Transportation and Logistics investment banking group at Credit Suisse Group. From 1993 to 1998, he served as a Managing Director and co-head of the Transportation and Logistics investment banking group at Deutsche Securities. Before this, he served in various finance and management positions at several large companies, including Whirlpool Financial Corporation, PacifiCorp Credit and GE Capital. Mr. Palmieri received a Bachelor of Science in Accounting from Wagner College. As a result of these and other professional experiences, Mr. Palmieri possesses particular knowledge and experience in logistics and financial management that strengthen the Board’s collective qualifications, skills, and experience.
Michael Gould, age 59. Mr. Gould was appointed as a director in July 2016. Mr. Gould is a seasoned information technology executive, currently serving as the Chief Executive Officer for Zonar Systems, a subsidiary of Continental, AG. Prior to Zonar Systems Mr. Gould served as Senior Vice President, Oracle Consulting in North America at Oracle Corporation. Prior to this, from 2008 to 2015, Mr. Gould led the Americas Technology Services Consulting Organization for Hewlett-Packard Company (“HP”) as the Vice President and General Manager. Prior to HP, Mr. Gould served in various roles at Oracle, BearingPoint and BEA. He holds a Bachelor of Science degree in Mechanical Engineering from Texas A&M University and a Master of Business Administration from Santa Clara University. As a result of these and other professional experiences, Mr. Gould possesses particular knowledge and experience in management and technology that strengthen the Board’s collective qualifications, skills and experience.
Radiant Logistics, Inc. – 2023 Proxy Statement 26
Kristin E. Toth, age 48. Ms. Toth was appointed as a director in June 2021. She has been the President and Board Member at Showroom Group, a furniture and home décor subscription service, since January 2021 and held the position of Chief Operating Officer from August 2019 until December 2020. She previously held leadership positions at start-up ventures including Zulily, an omnichannel e-commerce platform and Dolly, an on-demand last-mile delivery and moving service, where she held the position of Chief Operating Officer from October 2015 to May 2019. Prior to her extensive startup experience, Ms. Toth led several teams at Amazon in operations and retail, including inbound transportation, same-day delivery, movies and television, and the demand side of the business of Amazon’s digital music team, including Marketing, Product Management, Site Merchandising, Pricing, Business Development, and Design teams responsible for the launch of Amazon’s digital music cloud-based offering. Before joining Amazon, Ms. Toth held various leadership positions at Dell Computer Corp., where she led various teams to build technology infrastructure and software for the radical re-design of desktop manufacturing and supply chain. She serves on a number of non-profit boards as well as several advisory boards for startups (mostly women-founded and -led companies). She is the Board Chair for University of Michigan’s Center for Entrepreneurship, was a contributing author for Women in Tech (Sasquatch Books). She holds a Bachelor of Science in Engineering and Master of Science in Engineering in Industrial Engineering and Operations Research from the Tauber Institute for Global Operations at the University of Michigan, a Master of Science in Civil and Environmental Engineering from Massachusetts Institute of Technology, and a Master of Business Administration from Massachusetts Institute of Technology’s Sloan School of Management through the Leaders for Global Operations fellowship program. As a result of these and other professional experiences, Ms. Toth possesses deep experience in transportation and logistics, with an emphasis on emerging e-commerce and last-mile platforms, that strengthen the Board’s collective qualifications, skills, and experience.
MAJORITY VOTE STANDARD AND RESIGNATION POLICY
Our Bylaws provide for a majority vote standard for uncontested director elections. Director nominees will be elected by a majority of the votes cast. A “majority of the votes cast” means that the number of votes cast “for” a director nominee exceeds the number of votes cast “against” such director nominee, with “abstentions” and “broker non-votes” not counted as a vote cast either “for” or “against” that nominee’s election. However, director nominees will be elected by a plurality of the votes cast in connection with a contested election, as defined in our Bylaws.
Pursuant to our Corporate Governance Guidelines, any incumbent director who is not elected to the Board in accordance with the Bylaws shall promptly tender a written offer of resignation as a director. The Nominating and Corporate Governance Committee will recommend to the Board whether to accept or reject the director’s resignation offer or take other action, and the Board will take action with respect to the offer no later than 90 days following certification of the election results and will publicly disclose its decision regarding the director’s resignation offer, if applicable, promptly thereafter. Any director whose resignation offer is under consideration will abstain from participating in any decision regarding that resignation offer.
Board Recommendation
The Board of Directors unanimously recommends that our stockholders vote “FOR” the election of Bohn H. Crain, Richard P. Palmieri, Michael Gould and Kristin E. Toth to serve as members of the Board until the next annual meeting of stockholders and until their successors are duly elected and qualified.
The Board Recommends a Vote FOR Each Nominee for Director |
|
Radiant Logistics, Inc. – 2023 Proxy Statement 27
PROPOSAL NO. 2:
RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Appointment
The Audit and Executive Oversight Committee appoints our independent registered public accounting firm, or independent auditor. In this regard, the Audit and Executive Oversight Committee evaluates the qualifications, performance, and independence of our independent auditor and determines whether to re-engage the current auditor. As part of its evaluation, the Audit and Executive Oversight Committee considers, among other factors, the quality and efficiency of the services provided by the independent auditor, including the performance, technical expertise, and industry knowledge of the lead audit partner and the audit team assigned to our account; the overall strength and reputation of the audit firm; the auditor’s national capabilities relative to our business; the auditor’s knowledge of our operations; and the auditor’s fees. Upon consideration of these and other factors, the Audit and Executive Oversight Committee has elected to seek stockholder ratification of the selection of Moss Adams, LLP (Moss Adams) to serve as our independent registered public accounting firm for the fiscal year ending June 30, 2024. Moss Adams had been appointed by the Audit and Executive Oversight Committee on or about December 10, 2021.
Stockholder ratification of the selection of Moss Adams as our independent registered public accounting firm is not required by our Bylaws or otherwise. However, the Board is submitting the appointment Moss Adams to the stockholders for ratification as a matter of good corporate practice. If our stockholders fail to ratify the appointment, the Audit Committee will reconsider whether or not to retain Moss Adams. Even if the selection is ratified by our stockholders, the Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit Committee determines that such a change would be in the best interests of Radiant Logistics and our stockholders.
A representative of Moss Adams is expected to be present at the Annual Meeting and will have an opportunity to make a statement if he or she so desires and will be available to respond to appropriate questions.
Audit, Audit-Related, Tax, and Other Fees
The fees billed for professional services provided by Moss Adams in fiscal year 2023 were:
|
|
Fiscal years ended June 30, |
|
|||||
Type of Fees |
|
2023 |
|
|
2022 |
|
||
Audit fees |
|
$ |
1,573,983 |
|
|
$ |
1,706,253 |
|
Audit related fees |
|
|
— |
|
|
|
— |
|
Tax fees |
|
|
— |
|
|
|
— |
|
All other fees |
|
|
— |
|
|
|
— |
|
Total Fees |
|
$ |
1,573,983 |
|
|
$ |
1,706,253 |
|
In the above table, in accordance with the definitions of the SEC, “Audit Fees” consisted of fees for the audit of our consolidated financial statements included in our Annual Reports to Stockholders, reviews of the unaudited financial statements included in our Quarterly Reports on Form 10-Q, and consultation concerning financial accounting and reporting standards, as well as services normally provided in connection with statutory and regulatory filings or engagements, comfort letters, consents, and assistance with documents filed with the SEC. Audit Fees also included fees for the audit of the effectiveness of our internal control over financial reporting as required by Section 404 of the Sarbanes-Oxley Act. “Audit-Related Fees” consisted of fees for assurance and related services. “Tax Fees” consisted of fees billed for permissible tax consulting, planning, and compliance services. “All Other Fees” consisted of subscription fees for products and services no described in any other category.
Radiant Logistics, Inc. – 2023 Proxy Statement 28
Pre-Approval Policies and Procedures
The Audit and Executive Oversight Committee is responsible for selecting, appointing, evaluating, compensating, retaining, and overseeing the work of our independent registered public accounting firm. In recognition of this responsibility, the Audit and Executive Oversight Committee has established policies and procedures in its charter regarding pre-approval of any audit and non-audit service provided to Radiant Logistics by our independent registered public accounting firm and the fees and terms thereof. Briefly, any audit or non-audit service provided to us by our independent registered public accounting firm must be pre-approved by the Audit and Executive Oversight Committee.
The Audit and Executive Oversight Committee considers the compatibility of the provision of other services provided by Moss Adams and BDO with the maintenance of its independence. The Audit and Executive Oversight Committee approved all audit and non-audit services provided by Moss Adams and BDO in fiscal year 2023 and fiscal year 2022.
Audit AND EXECUTIVE OVERSIGHT Committee Report
In connection with the preparation of our audited financial statements for the fiscal year ended June 30, 2023, the Audit and Executive Oversight Committee issued the following report for inclusion in this proxy statement and our 2023 Annual Report:
Audit and Executive Oversight COMMITTEE
Richard P. Palmieri, Chair
Michael Gould
Kristin E. Toth
CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
On December 7, 2021, we dismissed BDO as the Company’s former independent registered public accounting firm. The dismissal of BDO was approved by the Audit and Executive Oversight Committee of the Board of Directors of the Company.
The reports of BDO on the consolidated financial statements of the Company for the fiscal years ended June 30, 2021 and 2020 did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles.
Radiant Logistics, Inc. – 2023 Proxy Statement 29
During the Company’s fiscal years ended June 30, 2021 and 2020 and through December 7, 2021, there were no disagreements between the Company and BDO on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of BDO, would have caused BDO to make reference to the subject matter of the disagreements in connection with its audit reports on the Company’s consolidated financial statements.
During the Company’s fiscal years ended June 30, 2021 and 2020 and the interim period through December 7, 2021, BDO did not advise the Company of any of the matters specified in Item 304(a)(1)(v) of Regulation S-K, except that:
The Company provided BDO with a copy of this report on Form 8-K in accordance with Item 304(a) of Regulation S-K prior to its filing with the Securities and Exchange Commission and requested that BDO furnish the Company with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements and, if it does not agree, the respects in which it does not agree. A copy of the letter from BDO is filed as Exhibit 16.1 to the report.
On December 10, 2021, the Company, through and with the approval of its Audit and Executive Oversight Committee, engaged Moss Adams as its independent registered public accounting firm.
During the Company’s two most recently completed fiscal years and the interim period through the date of engagement of Moss Adams, neither the Company nor anyone on behalf of the Company consulted with Moss Adams regarding (a) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements as to which the Company received a written report or oral advice that was an important factor in reaching a decision on any accounting, auditing or financial reporting issue; or (b) any matter that was the subject of a disagreement or a reportable event as defined in Items 304(a)(1)(iv) and (v), respectively, of Regulation S-K.
Board Recommendation
The Board of Directors unanimously recommends that our stockholders vote “FOR” ratification of the appointment of Moss Adams, LLP as our independent registered public accounting firm for the fiscal year ending June 30, 2024.
The Board Recommends a Vote FOR Proposal No. 2 |
|
Radiant Logistics, Inc. – 2023 Proxy Statement 30
PROPOSAL NO. 3:
ADVISORY VOTE ON EXECUTIVE COMPENSATION
Background
The Board of Directors is providing our stockholders with an advisory vote on our executive compensation pursuant to the Dodd-Frank Wall Street Consumer Protection Act (“Dodd-Frank Act”) and Section 14A of the Exchange Act. This advisory vote, commonly known as a say-on-pay vote, is a non-binding vote on the compensation paid to our named executive officers as set forth in this proxy statement.
At our 2022 Annual Meeting of Stockholders, our stockholders had the opportunity to vote on an advisory say-on-pay proposal. Approximately 86% of the votes cast at last year’s annual meeting of stockholders were in favor of our say-on-pay proposal.
Why You Should Vote in Favor of our Say-on-Pay Vote
Our Pay Philosophy
The Audit and Executive Oversight Committee has formalized its pay philosophy. Under the Company’s pay philosophy, the Audit and Executive Oversight Committee is guided in its pay decisions by several principles and factors, with our fundamental executive compensation philosophy being the alignment of executive pay with performance, and the alignment of the interests of executives with those of stockholders.
The objectives of our executive compensation program are designed to ensure that we:
The Audit and Executive Oversight Committee has approved the use of a formal peer group to provide market reference points to consider when benchmarking executive compensation, outside director compensation, short- and long-term incentive design, and corporate governance practices.
The Audit and Executive Oversight Committee believes that our compensation program should be transparent and easy to understand, with the majority of executive pay being at risk and being performance-based, with predetermined financial metrics aligned with our business strategy with individual payouts based on a combination of overall business as well as individual performance. We also believe in recognizing individual performance through the establishment of strategic/non-financial goals reflecting our corporate culture, values and stockholder interests.
The Audit and Executive Oversight Committee employs a total compensation approach in establishing executive compensation opportunities, consisting of base salary, a short-term incentive program (our STIP) consisting of quarterly cash incentives, a long-term incentive program (our LTIP) consisting of annual equity grants of restricted stock units that vest in full after a three-year vesting period and a long-term performance-based program consisting of performance units that vest based on a combination of company and individual performance goals achieved over a three-year period, a competitive benefits package and limited perquisites.
Our compensation program is designed to provide a mix of both fixed and variable incentive compensation and to reward a mix of different performance measures. The variable short-term incentive and long-term incentive portions of compensation are designed to reward both annual performance (under the short-term incentive program) and longer-term performance (under the long-term incentive program). We believe this design mitigates any incentive for short-term risk-taking that could be detrimental to our long-term interests.
Radiant Logistics, Inc. – 2023 Proxy Statement 31
Engagement and Responsiveness
We regularly seek stockholder input on our executive compensation program and then incorporate that feedback to further enhance the program. Some of the compensation related actions we have taken in response to stockholder feedback over the last several years are described in the “Compensation Discussion and Analysis”.
Best Practices
Our compensation practices include many best pay practices that support our executive compensation objectives and principles and benefit our stockholders.
|
What We Do |
|
What We Don’t Do |
|
Maintain a competitive compensation package |
|
No guaranteed salary increases or bonuses |
|
Structure our executive officer compensation so that a significant portion of pay is at risk |
|
No excessive perquisites |
|
Emphasize long-term performance in our equity-based incentive awards |
|
No repricing of stock options unless approved by stockholders |
|
Maintain a robust clawback policy |
|
No pledging of Radiant securities |
|
Require a double-trigger for equity acceleration upon a change of control |
|
No short sales or derivative transactions in Radiant stock, including hedges |
|
Have robust stock ownership and retention guidelines |
|
No current payment of dividends on unvested awards |
|
Hold an annual say-on-pay vote |
|
No excise or other tax gross-ups (other than the grandfathered arrangement with our founder and CEO) |
We encourage our stockholders to read the “Compensation Discussion and Analysis,” beginning on page 34, which describes in detail our executive compensation program and the executive compensation decisions made by the Audit and Executive Oversight Committee in fiscal year 2023, as well as the accompanying executive compensation tables and narratives that provide detailed information on the compensation of our named executive officers.
We believe that our executive compensation program is competitive, focused on pay for performance, and strongly aligned with the long-term interests of our stockholders. The Audit and Executive Oversight Committee believes that executive compensation for fiscal year 2023 was reasonable, appropriate, and justified by the performance of the Company and the result of a carefully considered approach.
PROPOSED RESOLUTION
The Board of Directors recommends that our stockholders vote in favor of the say-on-pay vote as set forth in the following resolution:
RESOLVED, that our stockholders approve, on an advisory basis, the compensation paid to our named executive officers, as disclosed pursuant to the compensation disclosure rules of the SEC, including in the “Compensation Discussion and Analysis,” the accompanying compensation tables and the corresponding narrative discussion and footnotes, and any related material disclosed in this proxy statement.
Stockholders are not voting to approve or disapprove the Board’s recommendation. As this is an advisory vote, the outcome of the vote is not binding on us with respect to future executive compensation decisions, including those relating to our named executive officers, or otherwise. The Audit and Executive Oversight Committee and Board of Directors expect to take into account the outcome of the vote when considering future executive compensation decisions.
Radiant Logistics, Inc. – 2023 Proxy Statement 32
NEXT SAY-ON-PAY VOTE
A non-binding advisory vote on the frequency of future advisory votes on our executive compensation is required to be conducted every six years under Section 14A of the Exchange Act pursuant to the Dodd-Frank Act. At our 2019 Annual Meeting of Stockholders, we asked our stockholders to indicate whether they preferred that we hold a say-on-pay vote every year, every two years or every three years. Our stockholders approved an advisory vote on an annual basis. Consistent with the results of the advisory vote on the frequency of the say-on-pay vote held at the 2019 Annual Meeting of Stockholders, the Board of Directors determined that we will conduct a say-on-pay vote on an annual basis. Accordingly, the next say-on-pay vote will occur at our 2024 Annual Meeting of Stockholders.
Board Recommendation
The Board of Directors unanimously recommends that our stockholders vote “FOR” approval, on an advisory basis, of our executive compensation, or say-on-pay vote.
The Board Recommends a Vote FOR Proposal No. 3 |
|
Radiant Logistics, Inc. – 2023 Proxy Statement 33
COMPENSATION DISCUSSION AND ANALYSIS
INTRODUCTION
This Compensation Discussion and Analysis (“CD&A”) addresses the principles underlying our policies and decisions with respect to the compensation of our executive officers who are named in the “Summary Compensation Table” and material factors relevant to these policies and decisions. This CD&A should be read together with the related tables and disclosures that follow. When reading this CD&A, please note that we were a smaller reporting company under the federal securities laws and were not required to provide a “Compensation Discussion and Analysis” of the type required by Item 402 of SEC Regulation S-K and this CD&A is simply intended to supplement our SEC-required disclosures.
Our named executive officers for the fiscal year ended June 30, 2023 are listed below. We sometimes refer to these individuals collectively as our named executive officers (“NEOs”) and our Chief Executive Officer as our “CEO.” The following four officers are our only executive officers.
Name |
Age |
Position with Radiant Logistics |
Bohn H. Crain |
59 |
Chairman of the Board of Directors and Chief Executive Officer |
Todd E. Macomber |
59 |
Senior Vice President and Chief Financial Officer |
Arnold Goldstein |
69 |
Senior Vice President and Chief Commercial Officer |
John W. Sobba |
67 |
Senior Vice President and General Counsel |
Executive Summary
Who We Are
We operate as a third-party logistics company, providing technology-enabled global transportation and value-added logistics solutions primarily to customers based in the United States and Canada. We service a large and diversified account base across a range of industries and geographies, which we support from an extensive multi-brand network of over 100 operating locations (including 25 Company-owned locations) across North America as well as an integrated international service partner network located in other key markets around the globe. As a third-party logistics company, we generally do not own the transportation assets but we have a vast carrier network of asset-based transportation companies, including motor carriers, railroads, airlines, and ocean lines.
Through our operating locations across North America, we offer domestic and international air and ocean freight forwarding services and freight brokerage services. Our primary transportation services involve arranging shipments, on behalf of our customers, of materials, products, equipment, and other goods that are generally larger than shipments handled by integrated carriers of primarily small parcels, such as FedEx, DHL and UPS, including arranging and monitoring all aspects of material flow activity utilizing advanced information technology systems. We also provide other value-added supply chain services, including order fulfillment, inventory management, and warehouse and distribution services, and customs brokerage services to complement our core transportation service offering.
Radiant Logistics, Inc. – 2023 Proxy Statement 34
Fiscal Year 2023 Business Highlights
FINANCIAL
$1,085.5 million |
Revenues Achieved $1,085.5 million in total revenues, a 25.6%↓ year-over-year |
$283.8 million |
Non-GAAP Adjusted Gross Profit Achieved $283.8 million in non-GAAP adjusted gross profit, a 7.3%↓ year-over-year |
$20.6 million |
Net Income Achieved net income of $20.6 million, a 53.7%↓ year-over-year, or $0.43 per basic and $0.42 per fully diluted share |
$39.3 million |
Non-GAAP Adjusted Net Income Achieved non-GAAP adjusted net income of $39.3 million, a 32.5%↓ year-over-year, or $0.82 per basic and $0.79 per fully diluted share |
$55.6 million |
Non-GAAP Adjusted EBITDA and Adjusted EBITDA Margin Achieved non-GAAP adjusted EBITDA of $55.6 million, a 31.3%↓ year-over-year, and non-GAAP adjusted EBITDA Margin of 19.6%, ↓680 basis points year-over-year |
|
|
OPERATIONAL
|
Strong Network of Company-Owned Locations and Strategic Operating Partners Maintains a strong network of over 25 company-owned locations and over 100 strategic operating partners (independent agents) in the United States and Canada as well as additional global partners to facilitate international shipments |
|
Compelling Multi-Modal Service Offering Continues to build out a strong compelling multi-modal service offering, leveraging our technology and bundling value-added logistics solutions with our core transportation service offerings |
|
Highly Diversified Customer Base Cultivates significant long-standing customer relationships across the platform, with no one customer representing more than 5% of our revenues |
STRATEGIC
$2.2 million |
2023 Investment in Robust and Advanced Technology Offerings and Platform Provides robust and advanced technology offerings to our customers, our company-owned locations, strategic operating partners, and to support corporate and finance operations. During fiscal year 2023, we invested over $2.2 million on technology enhancements and software systems to increase our operating efficiency and improve technology offerings. |
21 acquisitions |
Proven Growth Platform Continues to deliver profitable growth with a track record of executing and integrating 21 acquisitions since our inception in 2006. |
|
|
Annex I provides reconciliations of non-GAAP financial measures to most comparable U.S. GAAP measures. |
Radiant Logistics, Inc. – 2023 Proxy Statement 35
Fiscal Year 2023 Compensation Actions and Outcomes
Our compensation program is aligned with our pay philosophy of aligning executive pay with performance and executive financial interest with stockholder financial interest and is designed to provide a mix of both fixed and variable incentive compensation and to reward a mix of different performance measures. In April 2021, the Audit and Executive Oversight Committee engaged a compensation consultant to, among other things, perform an executive benchmarking analysis of our executive compensation. As a result of this analysis, we introduced in fiscal year 2022 the use of performance unit awards as an additional component of our Long-Term Incentive Plan (“LTIP”), as discussed in more detail below under “—Our Named Executive Officer Compensation—Long-Term Incentives – Equity Awards.”
Our fiscal year 2023 compensation actions and incentive plan outcomes based on our performance are summarized below:
Pay Element |
Fiscal Year 2023 Actions |
Base Salary |
• Base salary provides a source of fixed income that reflects scope and responsibility of the position held while ensuring a meaningful percentage of the executives’ overall compensation opportunity is in the form of performance-based compensation. • Base salary for our NEOs remained unchanged during fiscal year 2023. |
Short-Term Incentives |
• Our Short-Term Incentive Program (“STIP”) allows our NEOs to participate on a pro rata basis along with other STIP participants in a quarterly profit pool calculated as a percentage of our quarterly adjusted EBITDA, with such percentage determined by the Audit and Executive Oversight Committee. Historically, this percentage has been a constant 5% but this remains within the discretion of the Audit and Executive Oversight Committee. • The NEOs’ opportunity to participate in the STIP is expressed as a percentage of their base salary and is subject to further adjustment based on their achievement relative to individual performance goals. The target STIP award opportunity percentages for our NEOs remained the same as in prior years and were 50% of base salary for our CEO and 35% for our other NEOs. • The NEOs earned the following quarterly bonus payouts for fiscal year 2023: |
Executive |
|
1Q |
|
2Q |
|
3Q |
|
4Q |
|
Total |
B. Crain |
|
92,073 |
|
66,486 |
|
59,442 |
|
44,191 |
|
262,192 |
T. Macomber |
|
35,318 |
|
26,512 |
|
24,476 |
|
18,196 |
|
104,502 |
A. Goldstein |
|
38,311 |
|
27,377 |
|
24,476 |
|
19,207 |
|
109,371 |
J. Sobba |
|
37,912 |
|
26,512 |
|
24,476 |
|
18,196 |
|
107,096 |
Long-Term Incentives |
• Our fiscal year 2023 LTIP consisted of 30% time-vested restricted stock unit (“RSU”) awards, which were determined based on achievement of pre-established company and individual goals, and 70% performance share units. • The NEOs’ opportunity to participate in the LTIP is expressed as a percentage of their base salary. The LTIP award opportunities for our NEOs remained the same as in prior fiscal years and were 50% of base salary for our CEO and 35% for our other NEOs. • The RSU awards vest in full on the third-year anniversary of the grant date. • After the completion of fiscal year 2022, in September 2022, our NEOs received the following RSU awards, which were determined based on achievement of pre-established company and individual goals for fiscal year 2022: |
Executive |
|
Target LTIP Award Opportunity |
|
Number of RSUs |
|
Grant Date |
B. Crain |
|
50% |
|
41,058 |
|
280,837 |
T. Macomber |
|
35% |
|
17,245 |
|
117,956 |
A. Goldstein |
|
35% |
|
17,245 |
|
117,956 |
J. Sobba |
|
35% |
|
16,925 |
|
115,767 |
Radiant Logistics, Inc. – 2023 Proxy Statement 36
|
• In fiscal year 2023, our NEOs received the following performance stock unit (“PSU”) awards, which will vest and be paid out in shares of our common stock based on individual performance goals and the appreciation in the notional value per fully diluted share for the three-year period ending June 30, 2025: |
Executive |
|
Number of PSUs |
|
Grant Date Fair Value |
B. Crain |
|
97,926 |
|
632,602 |
T. Macomber |
|
38,402 |
|
248,077 |
A. Goldstein |
|
38,402 |
|
248,077 |
J. Sobba |
|
38,402 |
|
248,077 |
Other Compensation Related Actions |
• Approximately 86% of the votes cast at our 2022 Annual Meeting of Stockholders were in favor of our annual say-on-pay vote. |
COMPENSATION PHILOSOPHY
The Audit and Executive Oversight Committee is guided in its pay decisions by several principles and factors, with our fundamental executive compensation philosophy being the alignment of: executive pay with performance, and the alignment of the interests of executives with those of stockholders.
The objectives of our executive compensation program are designed to ensure that we:
The Audit and Executive Oversight Committee has approved the use of a formal peer group to provide market reference points to consider when benchmarking executive compensation, outside director compensation, short- and long-term incentive design, and corporate governance practices.
The Audit and Executive Oversight Committee believes that our compensation program should be transparent and easy to understand, with the majority of executive pay being at risk and being performance-based, with predetermined financial metrics aligned with our business strategy. We also believe in recognizing individual performance through the establishment of strategic/non-financial goals reflecting our corporate culture, values and stockholder interests.
The Audit and Executive Oversight Committee employs a total compensation approach in establishing executive compensation opportunities, consisting of base salary, a short-term incentive program (our STIP) consisting of quarterly cash incentives, a long-term incentive program (our LTIP) consisting of annual equity grants of RSUs that vest in full after a three-year vesting period and a long-term performance-based program consisting of performance units that vest based on a combination of company and individual performance goals achieved over a three-year period, a competitive benefits package and limited perquisites.
Our compensation program is designed to provide a mix of both fixed and variable incentive compensation and to reward a mix of different performance measures. The variable short-term incentive and long-term incentive portions of compensation are designed to reward both annual performance (under the short-term incentive program) and longer-term performance (under the long-term incentive program). We believe this design mitigates any incentive for short-term risk-taking that could be detrimental to our long-term interests.
Radiant Logistics, Inc. – 2023 Proxy Statement 37
Say-on-Pay Vote
At our 2022 Annual Meeting of Stockholders, our stockholders had the opportunity to vote on an advisory say-on-pay proposal. Approximately 86% of the votes cast were in favor of our say-on-pay proposal. We believe these favorable results affirmed stockholder support of our approach to executive compensation and did not believe it was necessary to, and, therefore, did not, make any significant structural changes to our executive compensation program in response to the say-on-pay vote results.
OUR ENGAGEMENT AND RESPONSIVENESS
We regularly seek stockholder input on our executive compensation program and then incorporate that feedback to further enhance the program. Some of the compensation related actions we have recently taken in response to stockholder feedback are described below.
What We Heard |
What We Did |
Align the interest of executive officers with those of stockholders |
We adopted stock ownership and retention guidelines applicable to our NEOs to ensure that their interests would be closely aligned with those of our stockholders. All of our NEOs are in compliance with these guidelines. We have an anti-hedging/pledging policy. Our founder and CEO owns approximately 21.3% of our outstanding common stock. |
Emphasize long-term performance-based incentives |
Beginning in fiscal year 2022, we revised our LTIP to provide for new performance unit awards which will vest based upon achievement of a combination of company and individual performance goals as measured over a three-year period. The performance unit awards are in addition to our restricted stock unit awards which are granted on an annual basis and are determined based, in large part, on the achievement of annual company and individual performance goals, and once granted do not vest until the three-year anniversary of the grant date. The performance unit awards constitute at least 70% of our CEO’s target LTIP opportunity for fiscal year 2023. |
Increase disclosure on executive compensation |
As a smaller reporting company, we were not required to include a Compensation Discussion and Analysis section in our proxy statement nor the more extensive executive compensation tables. Starting in 2021, in response to stockholder feedback, we substantially increased and improved our executive compensation disclosure in this proxy statement, with an eye towards transparency despite the fact that we are not required to provide these disclosures. |
Ensure the recovery of incentive compensation based on incorrect calculations that resulted in a financial restatement |
In September 2021, we adopted a separate and more robust clawback policy covering cash and equity incentive compensation applicable to current and former executives. |
Radiant Logistics, Inc. – 2023 Proxy Statement 38
Perform a compensation risk assessment |
As a smaller reporting company, we were not required to perform a compensation risk assessment. Starting in 2021, in response to stockholder feedback, we performed a compensation risk assessment which concluded that our compensation policies, practices and programs, along with our governance structure, work together in a manner so as to encourage our executives (and employees) to pursue growth strategies that emphasize stockholder value creation, but not to take unnecessary or excessive risks that could threaten the value of our Company. |
Disclose CEO pay ratio. |
As a smaller reporting company, we were not required to disclose a CEO pay ratio. Starting in 2021, in response to stockholder feedback, we calculated and disclosed a CEO pay ratio in accordance with SEC rules and regulations under “—CEO Pay Ratio”. |
Adopt or disclose an anti-hedging/pledging policy |
We have increased substantially our disclosure of our anti-hedging/pledging policy in this proxy statement. |
Adopt a no tax gross-up policy |
In September 2021, we adopted a new tax gross-up policy that prohibits tax gross-ups, other than the grandfathered provision in the employment agreement with our founder and CEO. |
Compensation Highlights and Best Practices
Our compensation practices include many best pay practices that support our executive compensation objectives and principles, and benefit our stockholders.
|
What We Do |
|
What We Don’t Do |
|
Maintain a competitive compensation package |
|
No guaranteed salary increases or bonuses |
|
Structure our executive officer compensation so that a significant portion of pay is at risk |
|
No excessive perquisites |
|
Emphasize long-term performance in our equity-based incentive awards |
|
No repricing of stock options unless approved by stockholders |
|
Maintain a robust clawback policy |
|
No pledging of Radiant securities |
|
Require a double-trigger for equity acceleration upon a change of control |
|
No short sales or derivative transactions in Radiant stock, including hedges |
|
Have robust stock ownership and retention guidelines |
|
No current payment of dividends on unvested awards |
|
Hold an annual say-on-pay vote |
|
No excise or other tax gross-ups (other than the grandfathered arrangement with our founder and CEO) |
Radiant Logistics, Inc. – 2023 Proxy Statement 39
Executive Stock Ownership Guidelines
In September 2021, we established the following stock ownership and retention guideline, which are intended to further align the interests of our named executive officers with those of our stockholders.
Position |
Guideline |
Chief Executive Officer |
Four times base salary |
Other Named Executive Officers |
One times base salary |
Each NEO has five years to reach the officer’s stock ownership target. Until the applicable stock ownership guideline is achieved as described above, each NEO is required to retain an amount equal to 100% of the net shares received as a result of the vesting of restricted stock, restricted stock units or other equity-based awards or the exercise of stock options. “Net shares” are those shares that remain after shares are sold or netted to pay the exercise price of stock options (if applicable) and any applicable withholding or estimated taxes associated with the restricted stock, restricted stock unit, stock option, or other equity-based incentive award. All of our NEOs are in compliance with our stock ownership guidelines as of September 22, 2023.
Named Executive Officer |
Target Stock |
In Compliance? |
Ownership % |
Actual Stock Ownership as a Multiple of Base Salary |
Bohn H. Crain |
4x |
Yes |
21.3% |
142x |
Todd E. Macomber |
1x |
Yes |
Less than 1% |
9x |
Arnold Goldstein |
1x |
Yes |
Less than 1% |
5x |
John W. Sobba |
1x |
Yes |
Less than 1% |
2x |
Elements of Our Executive Compensation Program
Our executive compensation program consists of several key elements, which are described in the table below, along with the key characteristics of, and the purpose for, each element and key fiscal year 2023 changes. We describe each key element of our executive compensation program in more detail in the following pages, along with the compensation decisions made in fiscal year 2023.
Element |
Key Characteristics |
Purpose |
Fiscal Year 2023 Changes |
Base Salary (Fixed, Cash) |
A fixed amount, paid in cash periodically throughout the year and reviewed annually and, if appropriate, adjusted. |
Provides a source of fixed income that is market competitive and reflects scope and responsibility of the position held while providing a meaningful percentage of an executive’s overall compensation opportunity in the form of performance-based compensation. |
No change. |
Short-Term Incentive Plan (STIP) (Variable, Cash) |
A variable, short-term element of compensation that is payable quarterly in cash, based on adjusted EBITDA and achievement of pre-established individual goals. |
Motivates and rewards our executives for increased adjusted EBITDA and achievement of individual performance goals while supporting our variable cost based business model. |
No change. |
Long-Term Incentive Plan (LTIP) (Variable, Restricted Stock Units and Performance Units) |
A variable, long-term element of compensation is provided, which was composed of 30% RSU awards and 70% PSU awards during the fiscal year ended June 30, 2023. The RSU awards are based on achievement of pre-established company and individual goals and vest in full on the three-year anniversary of the grant date. The performance awards will vest upon the achievement of three-year performance goals and be paid out in shares of our common stock. |
Aligns the interests of our executives with our stockholders; encourages our executives to focus on long-term company financial performance measures that are deemed strategically and operationally important to our Company; promotes retention of our executives; and encourages significant ownership of our common stock. |
No change. |
Radiant Logistics, Inc. – 2023 Proxy Statement 40
Perquisites |
Includes an automobile allowance and Company-provided life and disability insurance premiums. |
Assists in allowing our executives to more efficiently utilize their time and support them in effectively contributing to our Company success. |
No change. |
Retirement Benefits |
Includes a qualified defined contribution retirement plan with a safe harbor Company match. |
Provides an opportunity for employees to save and prepare financially for retirement. |
No change. |
Competitive Considerations and Use of Market Data
Background
In April 2015, the Audit and Executive Oversight Committee hired Mercer (US) Inc. to perform an executive compensation study and provide it with guidance regarding our executive compensation program. Mercer provided the Audit and Executive Oversight Committee with compensation data with respect to similarly sized logistics and freight-forwarding companies and consulted with the Audit and Executive Oversight Committee about a variety of issues related to competitive compensation practices and incentive plan design. This information helped us to evaluate and modify our equity and cash compensation awards and practices to remain consistent with industry standards and to achieve our employee retention objectives. Through fiscal year 2021, these trends and this information was used by the Audit and Executive Oversight Committee to determine whether to make any additional changes to our overall compensation policies and program.
In December 2020, the Audit and Executive Oversight Committee engaged Meridian Compensation Partners to perform an executive compensation study and provide guidance regarding our executive compensation program, especially in light of the feedback we received from our stockholders on improvements that could be made to our program. Many of the recent changes we made to our executive compensation program in response to stockholder feedback were made with the input and assistance of Meridian Compensation Partners.
Peer Group
As part of Meridian Compensation Partners’ review of our executive compensation program, and specifically analyzing the market competitiveness and reasonableness of our program, Meridian Compensation Partners recommended a peer group based on the following three factors:
• Industry |
• Revenue |
• Market Capitalization |
Based on these factors, the following 25 companies were selected by the Audit and Executive Oversight Committee, upon recommendation of Meridian Compensation Partners, in February 2021 as members of our peer group for purposes of benchmarking the market competitiveness and reasonableness of our executive compensation program:
Air Transport Services Group, Inc. Allegiant Travel Company ArcBest Corporation Atlas Air Worldwide Holdings, Inc. Blackbaud, Inc. CAI International, Inc. Covenant Logistics Group, Inc. CSG Systems International, Inc. Daseke, Inc. |
Eagle Bulk Shipping Inc. Echo Global Logistics, Inc. Exl Service Holdings, Inc. Forward Air Corporation Genco Shipping and Trading Limited Heartland Express, Inc. Hub Group, Inc. Manhattan Associates, Inc. |
Marten Transport, Ltd. P.A.M. Transportation Services, Inc. Pangaea Logistics Solutions, Ltd. Pegasystems Inc. Saia, Inc. Universal Logistics Holdings, Inc. USA Truck, Inc. Werner Enterprises, Inc. |
All of these peer group companies were public companies at the time of the review. We compete with some of these peers for employees and customers in various markets. As of February 2021, when the peer group was recommended by Meridian Compensation Partners, we ranked at the 37th percentile of our peer group for revenue and at the 21st percentile for market capitalization. In constructing this peer group, the Audit and Executive Oversight Committee also considered whether to include companies that disclosed Radiant Logistics as a peer, companies that appear in the peer groups of our peer companies and companies that proxy advisory firms consider a peer of ours in their latest voting recommendations reports.
Radiant Logistics, Inc. – 2023 Proxy Statement 41
Use of Peer Group Information and Competitive Positioning
One of the objectives of our executive compensation philosophy is to design our executive compensation program to ensure that we attract and retain highly-talented and dedicated executives. To assist us in meeting this objective, we strive to compensate our executive officers in a manner that is competitive but also reasonable when considering our revenue and market capitalization relative to other members of our peer group. To ensure the competitiveness and reasonableness of our executive compensation packages relative to our industry, the Audit and Executive Oversight Committee periodically evaluates our peer group and an analysis of our executive compensation program vis a vis our peer group, with the aid of an independent external compensation consultant and management, and uses this information as one input in helping to determine appropriate pay levels.
In reviewing this benchmarking data, however, the Audit and Executive Oversight Committee recognizes that this information is not always appropriate as a stand-alone tool for setting compensation. This could be due to an imperfection in the peer group information or due to aspects of our business and objectives that may be unique to us. For example, the Audit and Executive Oversight Committee believes the February 2021 peer group of 26 companies as recommended by Meridian Compensation Partners is a less-than-ideal comparison group for purposes of benchmarking our executive compensation program since Radiant Logistics is ranked at the 37th percentile of our peer group for revenue and at the 21st percentile for market capitalization. This was primarily driven by the difficulty in creating a peer group due to limited number of viable peers in our industry with similarly sized revenues and market capitalization.
As a result, the Audit and Executive Oversight Committee does not explicitly target any percentile when assessing and setting executive compensation. Instead, the Audit and Executive Oversight Committee intends to analyze the specific competitiveness of any individual executive’s pay considering factors like not only the benchmarking data, but also the executive’s experience, skills and capabilities, contributions as a member of the executive management team, and contributions to our overall performance. We believe these others factors and considerations are more important at this time for our Company than peer group positioning to attract and retain the best executive talent to achieve our business strategies and objectives. The Audit and Executive Oversight Committee did note that our NEO base salaries, target short-term incentive opportunities, target total cash compensation and target long-term incentive opportunities, are below the 50th percentile, which the Audit and Executive Oversight Committee considered reasonable given the company’s revenues and market capitalization relative to its peers.
Accordingly, every year, we review each executive’s base salary and STIP and LTIP opportunities to determine whether they should be adjusted. Along with individual performance, we also consider primarily movement of salaries and other aspects of executive compensation in the market and trends, as well as our financial results from the prior fiscal year to determine appropriate compensation adjustments.
Named Executive Officer Compensation
Base Salary
Purpose: Base salary is designed to compensate our NEOs at a fixed level of compensation that provides some financial certainty and security for our NEOs, and also serves as a retention tool throughout the executive’s career.
Fiscal Year 2023 Review: The fiscal year 2023 base salaries of all of our NEOs were unchanged from their fiscal year 2022 base salaries.
Named Executive Officer |
Fiscal Year 2022 |
Fiscal Year 2023 |
Change |
Bohn H. Crain |
425,000 |
425,000 |
— |
Todd E. Macomber |
250,000 |
250,000 |
— |
Arnold Goldstein |
250,000 |
250,000 |
— |
John W. Sobba |
250,000 |
250,000 |
— |
Radiant Logistics, Inc. – 2023 Proxy Statement 42
Short-Term Incentive Plan – Quarterly Cash Bonuses
Purpose: Our STIP, or quarterly cash bonus program, is paid under our MICP and is designed to provide incentive compensation that supports our variable cost-based business strategy and emphasizes pay-for-performance by tying reward opportunities to company and individual performance.
STIP Awards and Plan Mechanics: Our STIP allows our NEOs to participate on a pro rata basis along with other STIP participants in a quarterly profit pool calculated as a percentage of our quarterly adjusted EBITDA. The opportunity of our NEOs to participate in the STIP is expressed as a percentage of their base salary and is subject to further adjustment based on their achievement relative to individual performance goals.
Since the quarterly bonus pool under the MICP in which our NEOs participate is determined based on a percentage of our quarterly adjusted EBITDA and there is no maximum limit to the size of the pool, our executives are incentivized to increase our profitability, although discretion could be exercised by the Audit and Executive Oversight Committee to decrease or otherwise adjust the size of the pool or individual payouts if determined appropriate. Primarily because of this discretion, as well as multiple other factors, including the design of the MICP, our other compensation policies and programs, and our controls and approval process, we do not believe the MICP creates unnecessary risk taking by our executives or other employees.
Payments under our MICP are paid quarterly as opposed to annually in order to instill a sense of urgency in progressing the company’s objectives while reinforcing and rewarding the entrepreneurial culture of the company.
Fiscal Year 2023 STIP Awards: The fiscal year 2023 target short-term incentive opportunities for our NEOs were unchanged from their fiscal year 2022 target.
Named Executive Officer |
Fiscal Year 2022 |
Fiscal Year 2023 |
Change |
|
|
Bohn H. Crain |
50% |
50% |
|
— |
|
Todd E. Macomber |
35% |
35% |
|
— |
|
Arnold Goldstein |
35% |
35% |
|
— |
|
John W. Sobba |
35% |
35% |
|
— |
|
The fiscal year 2023 target short-term incentive opportunities for our NEOs were paid quarterly based on our adjusted EBITDA performance for each fiscal quarter of fiscal year 2023 and their pro rata participation along with other STIP participants in the quarterly profit pool, which for fiscal year 2023 was calculated as 5% percent of our quarterly adjusted EBITDA. For purposes of the corporate quarterly bonus pool under the MICP, adjusted EBITDA is defined as our cumulative net income for such fiscal quarter, excluding the effects of interest, taxes, and the “non-cash” effects of depreciation and amortization on long-term assets, as well as all depreciation charges related to property, technology, equipment, and all amortization charges (including amortization of leasehold improvements), and further adjusted to exclude share-based compensation expense, changes in fair value of contingent consideration, expenses specifically attributable to acquisitions, ransomware incident related costs, change in fair value of interest rate swap contracts, transition and lease termination costs, foreign currency transaction gains and losses, extraordinary items, litigation expenses unrelated to our core operations, and other non-cash charges, as derived from our consolidated audited financial statements, and as determined by the Audit and Executive Oversight Committee in good faith. Note that this definition of adjusted EBITDA is essentially the same as our reported adjusted EBITDA with the exception that it adds back in the accrued bonus under the MICP.
Our adjusted EBITDA as calculated pursuant to our STIP for each quarter of our fiscal year 2023 was as follows (in millions):
1Q |
2Q |
3Q |
4Q |
18.6 |
16.2 |
11.6 |
9.2 |
Radiant Logistics, Inc. – 2023 Proxy Statement 43
Our NEOs earned the following quarterly bonuses under our STIP during fiscal year 2023:
Named Executive Officer |
1Q |
2Q |
3Q |
4Q |
Total |
Bohn H. Crain |
92,073 |
66,486 |
59,442 |
44,191 |
262,192 |
Todd E. Macomber |
35,318 |
26,512 |
24,476 |
18,196 |
104,502 |
Arnold Goldstein |
38,311 |
27,377 |
24,476 |
19,207 |
109,371 |
John W. Sobba |
37,912 |
26,512 |
24,476 |
18,196 |
107,096 |
The CEO’s share of each quarterly bonus pool was determined based on a formula of his target STIP opportunity and his individual performance and was approved by the Audit and Executive Oversight Committee.
In addition to participating in the STIP under the MICP, Arnold Goldstein, our Senior Vice President and Chief Commercial Officer, also receives additional compensation in connection with his management of our Vertical Sales Organization. This compensation is based on calculated as 1% of the Net Contribution of the Vertical Sales Organization, where Net Contribution is calculated as the gross profit attributed the Vertical Sales Associates less the associated costs for operating partner commissions, bad debts, corporate overhead, and the Vertical Sales Associates. Accordingly, Mr. Goldstein earned the following additional payments under this plan during fiscal year 2023:
1Q |
2Q |
3Q |
4Q |
Total |
37,655 |
13,041 |
20,429 |
24,889 |
96,014 |
Long-Term Incentive Plan – Annual Equity Grants
Purpose: Our LTIP, which is a component of our MICP, is designed to provide for incentive compensation that supports our variable cost-based business strategy and emphasizes pay-for-performance by tying reward opportunities to carefully determined and articulated performance goals at corporate, business unit, operating location and/or individual levels.
LTIP Awards and Mechanics: The opportunity of a NEO to participate in the LTIP is expressed as a percentage of the NEO’s base salary. Our LTIP for our NEOs for the past several years has consisted of RSU awards based on achievement of pre-established company and individual goals that vest in full on the three-year anniversary of the grant date. Beginning in fiscal year 2022, our LTIP also consists of performance unit awards in addition to RSU awards, as discussed in more detail below under “—LTIP Awards for Fiscal Year 2023.” These performance unit awards constitute at least 70% of our CEO’s target LTIP opportunity for fiscal year 2023.
LTIP Awards for Fiscal Year 2023: After the completion of fiscal year 2022, our NEOs received RSU and PSU awards. RSU awards were determined based on achievement of pre-established company and individual goals for fiscal year 2022. For our NEO’s, 90% of their RSU award opportunity was based on the Company’s achievement relative to budgeted adjusted EBITDA, as measured on a consolidated basis, and 10% of the RSU opportunity was based on their achievement relative to individual goals. The Audit and Executive Oversight Committee believes it is important to include an adjusted EBITDA performance metric in both our STIP and LTIP because of our emphasis on overall core profitability. The performance factor for each NEO for purposes of determining the number of RSUs granted reflects the Company’s achievement relative to budgeted adjusted EBITDA, as approved by the Audit and Executive Oversight Committee, and achievement relative to individual goals, as determined by the Audit and Executive Oversight Committee in the case of our CEO, and by the CEO, in the case of our other NEOs.
Named Executive Officer |
Fiscal Year 2022 Adjusted EBITDA Goal |
Fiscal Year 2022 Actual EBITDA |
Company Financial Goal Achievement |
Individual Goal Achievement |
Performance Factor |
Bohn H. Crain |
50.3 mil |
80.9 mil |
161% |
95% |
150% |
Todd E. Macomber |
50.3 mil |
80.9 mil |
161% |
95% |
150% |
Arnold Goldstein |
50.3 mil |
80.9 mil |
161% |
96% |
150% |
John W. Sobba |
50.3 mil |
80.9 mil |
161% |
94% |
150% |
Radiant Logistics, Inc. – 2023 Proxy Statement 44
The fiscal year 2023 LTIP award opportunities for RSU awards for our NEOs were unchanged from their fiscal year 2022 opportunity will vest in full on the three-year anniversary of the grant date.
Name Executive Officer |
Target RSU Award Opportunity |
Number of RSUs |
Grant Date Fair Value |
Bohn H. Crain |
50% |
41,058 |
280,837 |
Todd E. Macomber |
35% |
17,245 |
117,956 |
Arnold Goldstein |
35% |
17,245 |
117,956 |
John W. Sobba |
35% |
16,925 |
115,767 |
The fiscal year 2023 LTIP award opportunities for PSU awards for our NEOs were unchanged from their fiscal year 2022 opportunity and will vest upon the achievement of three-year performance goals.
Named Executive Officer |
Target PSU Award Opportunity |
Number of PSUs |
Grant Date Fair Value |
Bohn H. Crain |
150% |
97,926 |
632,602 |
Todd E. Macomber |
100% |
38,402 |
248,077 |
Arnold Goldstein |
100% |
38,402 |
248,077 |
John W. Sobba |
100% |
38,402 |
248,077 |
All Other Compensation – RLP Distributions
On June 28, 2006, we joined with Radiant Capital Partners, LLC (“RCP”), an affiliate of Mr. Crain, our CEO, to form Radiant Logistics Partners, LLC (“RLP”). RLP commenced operations in 2007 as a minority-owned business enterprise for the purpose of enabling us to expand the scope of our service offerings to include participation in certain supplier diversity programs that otherwise would not have been available to us. RLP is owned 60% by Mr. Crain and 40% by us. In the course of evaluating and approving the ownership structure, operations and economics emanating from RLP, a committee consisting of the independent Board member of the Company considered, among other factors, the significant benefits provided to us through association with a minority business enterprise, particularly as many of our largest current and potential customers have a need for diversity offerings. In addition, the committee concluded the economic relationship with RLP was on terms no less favorable to us than terms generally available from unaffiliated third parties. Mr. Crain’s share of distributed earnings from RLP are included in the “All Other Compensation” column of the Summary Compensation Table.
Other Benefits
In fiscal year 2023, our NEOs had the opportunity to participate in a qualified defined contribution retirement plan on the same basis as our other employees. We believe this plan provides an opportunity for our executives to plan for and meet their retirement savings needs. We do not provide any pension arrangements, nonqualified defined contribution, or other deferred compensation plans.
We provide our NEOs with modest perquisites to attract and retain them and to allow them to more efficiently utilize their time and to support them in effectively contributing to the success of our Company. The perquisites provided to our NEOs during fiscal year 2023 included an automobile allowance and Company-provided life and disability insurance premiums. We believe these benefits are an important part of our overall compensation program and help us accomplish our goal of attracting, retaining, and rewarding top executive talent.
Radiant Logistics, Inc. – 2023 Proxy Statement 45
Employment Agreements, SEVERANCE AND CHANGE OF CONTROL ARRANGEMENTS, and POST-TERMINATION RESTRICTIONS
The compensation paid to our NEOs is governed, in part, by written employment agreements with them, which are described below under “Executive Compensation—Employment and Other Agreements.” The purpose of these agreements is to define the essential terms of these executives’ employment relationships in a manner that will protect our business and other interests and the interests of the executive, including in the event his employment is terminated upon certain events. The severance provisions in the agreement are intended to induce these executives to continue employment with our Company and to retain them and provide consideration to them for certain restrictive covenants that apply following a termination of employment. Additionally, we entered into these agreements because they provide us valuable protection by subjecting these executives to restrictive covenants that prohibit the disclosure of confidential information during and following their employment and limit their ability to engage in competition with us or otherwise interfere with our business relationships following a termination of their employment. The receipt of any severance by these executives, other than our CEO, is conditioned upon his execution of a broad release of claims.
To encourage continuity, stability, and retention when considering the potential disruptive impact of an actual or potential corporate transaction, we have established change of control arrangements, including provisions in our employment agreements with our NEOs, which are described below under “Executive Compensation—Potential Post-Termination and Chane in Control Payments.” These provisions provide our NEOs certain payments and benefits in the event of a termination of their employment in connection with a change of control. These additional payments and benefits will not be triggered just by a change of control, but require a termination event not within the control of the executive, and thus are known as “double trigger” change of control arrangements. These “double trigger” change of control protections are intended to induce executives to accept or continue employment with our Company, provide consideration to executives for certain restrictive covenants that apply following termination of employment, and provide continuity of management in connection with a threatened or actual change of control transaction. If the employment of our CEO is terminated by us without cause or by him for good reason following a change of control or if the employment of one of our other NEOs is terminated by us without cause or by him for good reason within nine months following a change of control, the executive will be entitled to receive a severance payment and certain benefits. In the case of our NEOs, other than our CEO, the receipt of any severance is conditioned upon the executive’s execution of a release of claims.
We believe these change of control arrangements with our NEOs are an important part of our executive compensation program in part because they mitigate some of the risk for executives working in a smaller public company where there is a meaningful likelihood that the company may be acquired. Change of control benefits are intended to attract and retain qualified executives who, absent these arrangements and in anticipation of a possible change of control of our Company, might consider seeking employment alternatives to be less risky than remaining with our Company through the transaction. We believe that relative to our Company’s overall value, our potential change of control benefits are relatively small and are aligned with current peer company practices.
Risk Assessment
As a result of our assessment on risk in our compensation programs, we concluded that our compensation policies, practices, and programs and related compensation governance structure work together in a manner so as to encourage our employees, including our NEOs, to pursue growth strategies that emphasize stockholder value creation, but not to take unnecessary or excessive risks that could threaten the value of our Company.
As part of our assessment, we noted in particular the following:
Radiant Logistics, Inc. – 2023 Proxy Statement 46
Clawback Policy
In September 2021, our Board of Directors adopted a separate more robust clawback and forfeiture policy. The policy covers all current and former executive officers of the Company. Pursuant to the policy, the Board of Directors may in its sole discretion recover certain cash and/or equity-based incentive compensation that is approved, awarded or granted to a covered executive on or after September 27, 2021 if there is a material negative restatement of our financial statements or in the event a Covered Executive engaged in egregious conduct that is substantially detrimental to the Company. We applied the clawback policy to the restatement of our June 30, 2021 annual financial statements, September 30, 2021, December 31, 2021 and March 31, 2022 quarterly financial statements.
excise tax gross-up Policy
As part of our response to feedback from our stockholders, the Board of Directors adopted a stand-alone policy prohibiting gross-ups for the excise tax imposed by Sections 280(g) and 4999 of the U.S. Internal Revenue Code, as well as the reimbursement of NEOs for such excise tax, with respect to any cash and/or equity-based incentive compensation that constitute golden parachute payments made from and after July 1, 2021, with the exception of any gross-up payments as may be provided in the employment agreement with our founder and CEO.
ANTI-HEDGING/PLEDGING/speculative investments POLICY
Radiant Logistics considers it improper and inappropriate for those employed by or associated with Radiant Logistics to engage in short-term or speculative transactions in our securities or in other transactions in our securities that may lead to inadvertent violations of the insider trading laws. Accordingly, trading in our securities is subject to the following additional guidance, as set forth in our Insider Trading Policy, for all officers, directors, employees and agents (collectively referred to as insiders):
Radiant Logistics, Inc. – 2023 Proxy Statement 47
Tax CONSIDERATIONS
Prior to the enactment of the Tax Cuts and Jobs Act (“Tax Act”), in designing our executive compensation program, we considered the deductibility of executive compensation under Code Section 162(m). The Tax Act, among other things, repealed the exemption from Code Section 162(m)’s $1 million deduction limit for “performance-based” compensation for taxable years beginning after December 31, 2017, other than with respect to certain “grandfathered” arrangements entered into prior to November 2, 2017. Some of our compensation plans were designed with the intention of satisfying the requirements for “performance-based” compensation as defined in Code Section 162(m) prior to the effective date of the Tax Act so that such awards would be exempt from the Code Section 162(m) deduction limitation. While we designed these plans to operate in this manner, the exemption is no longer available for performance-based awards paid in tax years beginning after 2017 (other than with respect to certain “grandfathered” arrangements as noted above). Further, as to any grandfathered arrangements, the Audit and Executive Oversight Committee may administer the plans in a manner that does not satisfy the Code Section 162(m) performance-based compensation requirements in order to achieve a result that the Audit and Executive Oversight Committee determines to be appropriate, including by revising performance goals and/or adjustment events as needed to ensure our pay practices continue to align with performance.
How We Make Compensation Decisions
There are several elements to our executive compensation decision-making, which we believe allow us to most effectively implement our compensation philosophy. The Audit and Executive Oversight Committee, its independent external compensation consultant, and management all have a role in decision-making for executive compensation. The following table summarizes their roles and responsibilities.
Responsible Party |
Roles and Responsibilities |
Audit and Executive Oversight Committee
(Comprised solely of independent directors and reports to the Board of Directors) |
• Oversees all aspects of our executive compensation program. • Annually reviews and approves our corporate goals and objectives relevant to CEO compensation. • Evaluates CEO’s performance in light of such goals and objectives, and determines and approves his compensation based on this evaluation. • Determines and approves all executive officer compensation, including salary, bonus, and equity and non-equity incentive compensation. • Administers our equity and incentive compensation plans and reviews and approves equity awards and executive incentive payouts. • Reviews our incentive compensation arrangements to confirm that incentive pay does not encourage unnecessary risk-taking. • Evaluates market competitiveness of each executive’s compensation. • Evaluates proposed changes to our executive compensation program. • Assists the Board in developing and evaluating potential candidates for executive officer positions and overseeing the development of executive succession plans. • Has sole authority to hire consultants, approve their fees, and determine the nature and scope of their work. |
Independent External Compensation Consultant
(Independent under NYSE American continued listing standards and reports to the Audit and Executive Oversight Committee) |
• Provides advice and guidance on the appropriateness and competitiveness of our executive compensation program relative to our performance and market practice. • Examines our executive compensation program to ensure that each element supports our business strategy. • Assists in selection of peer companies and gathering competitive market data. • Provides advice with respect to our equity-based compensation plans. |
Chief Executive Officer
(With the support of other members of the management team) |
• Reviews performance of other executive officers and makes recommendations with respect to their compensation. |
Radiant Logistics, Inc. – 2023 Proxy Statement 48
|
• Confers with the Audit and Executive Oversight Committee and compensation consultant concerning design and development of compensation and benefit plans. • Provides no input or recommendations with respect to his own compensation. |
AUDIT AND EXECUTIVE OVERSIGHT COMMITTEE REPORT
The Audit and Executive Oversight Committee, which performs the equivalent functions of a compensation committee, has reviewed and discussed the foregoing “Compensation Discussion and Analysis” with our management. Based on this review and these discussions, the Audit and Executive Oversight Committee has recommended to the Board of Directors that the “Compensation Discussion and Analysis” be included in this proxy statement and incorporated by reference into our Annual Report on Form 10-K for the fiscal year ended June 30, 2023.
Audit and Executive Oversight COMMITTEE
Richard P. Palmieri, Chair
Michael Gould
Kristin E. Toth
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the compensation earned by our principal executive officer, our principal financial officer, and our two remaining executive officers during the past three fiscal years.
Name and Principal Position |
Year |
Salary |
|
Bonus |
|
Stock Awards |
|
Non-Equity Incentive Plan Compensation |
|
All Other Compensation |
|
Total |
|
||||||
Bohn H. Crain |
2023 |
|
425,000 |
|
|
— |
|
|
913,439 |
|
|
262,192 |
|
|
624,620 |
|
|
2,225,251 |
|
Chairman of the Board and |
2022 |
|
375,000 |
|
|
— |
|
|
889,474 |
|
|
416,757 |
|
|
1,163,715 |
|
|
2,844,946 |
|
Chief Executive Officer |
2021 |
|
325,000 |
|
|
— |
|
|
162,085 |
|
|
260,361 |
|
|
1,061,805 |
|
|
1,809,251 |
|
Todd E. Macomber |
2023 |
|
250,000 |
|
|
— |
|
|
366,033 |
|
|
104,502 |
|
|
25,717 |
|
|
746,252 |
|
Senior Vice President |
2022 |
|
225,000 |
|
|
94,000 |
|
|
358,244 |
|
|
174,621 |
|
|
24,567 |
|
|
876,432 |
|
Chief Financial Officer and Treasurer |
2021 |
|
200,000 |
|
|
50,000 |
|
|
69,820 |
|
|
112,157 |
|
|
26,295 |
|
|
458,272 |
|
Arnold Goldstein |
2023 |
|
250,000 |
|
|
— |
|
|
366,033 |
|
|
109,371 |
|
|
120,072 |
|
|
845,476 |
|
Senior Vice President and |
2022 |
|
225,000 |
|
|
100,000 |
|
|
358,244 |
|
|
176,688 |
|
|
167,027 |
|
|
1,026,959 |
|
Chief Commercial Officer |
2021 |
|
200,000 |
|
|
200,000 |
|
|
69,820 |
|
|
112,157 |
|
|
151,763 |
|
|
733,740 |
|
John W. Sobba |
2023 |
|
250,000 |
|
|
— |
|
|
363,844 |
|
|
107,096 |
|
|
25,543 |
|
|
746,483 |
|
Senior Vice President and |
2022 |
|
220,833 |
|
|
— |
|
|
345,248 |
|
|
172,920 |
|
|
24,826 |
|
|
763,827 |
|
General Counsel |
2021 |
|
200,000 |
|
|
30,000 |
|
|
69,820 |
|
|
112,157 |
|
|
24,739 |
|
|
436,716 |
|
Radiant Logistics, Inc. – 2023 Proxy Statement 49
Name |
Distributed Share of RCP Earnings |
|
Company Match 401(k) Contributions |
|
Automobile Allowance |
|
Life and Disability Insurance Premiums |
|
Commissions |
|
Total Other Compensation |
|
||||||
Bohn H. Crain |
|
600,000 |
|
|
11,550 |
|
|
12,000 |
|
|
1,070 |
|
|
— |
|
|
624,620 |
|
Todd E. Macomber |
|
— |
|
|
12,647 |
|
|
12,000 |
|
|
1,070 |
|
|
— |
|
|
25,717 |
|
Arnold Goldstein |
|
— |
|
|
11,083 |
|
|
12,000 |
|
|
975 |
|
|
96,014 |
|
|
120,072 |
|
John W. Sobba |
|
— |
|
|
12,568 |
|
|
12,000 |
|
|
975 |
|
|
— |
|
|
25,543 |
|
Employment Agreements
CEO Employment Agreement
On January 13, 2006, we entered into an employment agreement with Bohn H. Crain to serve as our Chief Executive Officer. On December 31, 2008, we and Mr. Crain entered into a letter agreement for the purpose of (i) amending the employment agreement to ensure compliance with the requirements of Section 409A of the Code, and (ii) revising the general renewal period of the agreement of one to five years in the event of a change in control. On June 11, 2011, we and Mr. Crain entered into a letter agreement for the purpose of amending the employment agreement to (1) extend the initial term of the agreement through December 31, 2016, (2) increase the automatic renewal periods of the agreement from one to three years, and (3) increase Mr. Crain’s base salary. The amended agreement provides for an annual base salary of $325,000, a performance bonus of up to 50% of the base salary based upon the achievement of certain target objectives, and a discretionary merit bonus that can be awarded at the discretion of our Board of Directors. Pursuant to our MICP, Mr. Crain will be evaluated with a target bonus, based upon achievement of corporate and individual objectives, of 50% of base compensation. The amended agreement contains severance and change of control provisions, as described in more detail under “—Potential Post-Termination and Change in Control Payments,” and standard and customary non-solicitation, non-competition, work made for hire, and confidentiality provisions. During fiscal year 2022, the Board of Directors approved an increase to Mr. Crain’s base salary, to an amount of $425,000 annually, effective on January 1, 2022.
Other NEO Employment Agreements
Effective May 14, 2012, we entered into an employment agreement with Todd E. Macomber, the Company’s Senior Vice President and Financial Officer. Under his employment agreement, Mr. Macomber is entitled to receive an annual base salary in the amount of $200,000, subject to annual review. Mr. Macomber is also entitled to participate in the Company’s stock option program and annual incentive compensation program, pursuant to which he may earn a discretionary bonus with an initial target of 35% of his annual base salary. Mr. Macomber is also eligible to participate in such life insurance, hospitalization, major medical and other health and other benefits offered by the Company to other similar executives. He is also eligible for a $1,000 per month car allowance benefit and to participate in the Company’s 401(k) plan and is entitled to three weeks of paid vacation per year. During fiscal year 2022, the Board of Directors approved an increase to Mr. Macomber’s base salary, to an amount of $250,000 annually, effective on January 1, 2022.
Radiant Logistics, Inc. – 2023 Proxy Statement 50
Effective February 6, 2015, we entered into an employment agreement with Arnold Goldstein, the Company’s Senior Vice President and Chief Commercial Officer. Under his employment agreement, Mr. Goldstein is entitled to receive an annual base salary in the amount of $200,000, subject to annual review. Mr. Goldstein is also entitled to participate in the Company’s stock option program and annual incentive compensation program, pursuant to which he may earn a discretionary bonus with an initial target of 35% of his annual base salary. Mr. Goldstein is also eligible to participate in such life insurance, hospitalization, major medical and other health and other benefits offered by the Company to other similar executives. He is also eligible for a $1,000 per month car allowance benefit and to participate in the Company’s 401(k) plan and is entitled to three weeks of paid vacation per year. During fiscal year 2022, the Board of Directors approved an increase to Mr. Goldstein’s base salary, to an amount of $250,000 annually, effective on January 1, 2022.
Effective April 27, 2018, we entered into an employment agreement with John W. Sobba, the Company’s Senior Vice-President and General Counsel. Under his employment agreement, Mr. Sobba is entitled to receive an annual base salary in the amount of $200,000, subject to annual review. Mr. Sobba is also entitled to participate in the Company’s stock option program and annual incentive compensation program, pursuant to which he may earn a discretionary bonus with an initial target of 35% of his annual base salary. Mr. Sobba is also eligible to participate in such life insurance, hospitalization, major medical and other health and other benefits offered by the Company to other similar executives. He is also eligible for a $1,000 per month car allowance benefit and to participate in the Company’s 401(k) plan and is entitled to three weeks of paid vacation per year. During fiscal year 2022, the Board of Directors approved an increase to Mr. Sobba’s base salary, to an amount of $250,000 annually, effective on January 1, 2022.
All of these agreements also contain standard and customary severance and change of control provisions, as described in more detail under “—Potential Post-Termination and Change in Control Payments,” as well as standard and customary non-solicitation, non-competition, work made for hire, and confidentiality provisions.
GRANTS OF PLAN-BASED AWARDS DURING FISCAL year 2023
The table below provides information concerning grants of plan-based awards to each of our NEOs during the fiscal year ended June 30, 2023. Non-equity incentive plan awards were granted under our MICP, the material terms of which are described under “Compensation Discussion and Analysis—Named Executive Officer Compensation—Short-Term Incentive-Quarterly Cash Bonuses.” Stock awards in the form of RSU and PSU awards were granted under our stockholder-approved plan, the Radiant Logistics, Inc. 2021 Omnibus Incentive Plan. The material terms of these awards are described under “Compensation Discussion and Analysis—Named Executive Officer Compensation—Long-Term Incentives – Annual Equity Grants” and in the notes to the table below.
|
|
Estimated Future Payouts under Non-Equity Incentive Plan Awards(1) |
Estimated Future Payouts under Equity Incentive Plan Awards(2) |
All Other Stock Awards: Number of Shares of Stock or |
Grant Date Fair Value Stock and Option |
||||
Name |
Grant Date |
Threshold |
Target |
Maximum |
Threshold |
Target |
Maximum |
Units(3) |
Awards(4) |
Bohn H. Crain |
|
|
|
|
|
|
|
|
|
Cash award |
— |
106,250 |
212,500 |
N/A |
— |
— |
— |
— |
— |
RSU award |
9/9/2022 |
— |
— |
— |
— |
— |
— |
41,058 |
280,837 |
PSU award |
5/23/2023 |
— |
— |
— |
48,963 |
97,926 |
146,889 |
— |
632,602 |
Todd E. Macomber |
|
|
|
|
|
|
|
|
|
Cash award |
— |
43,750 |
87,500 |
N/A |
— |
— |
— |
— |
— |
RSU award |
9/9/2022 |
— |
— |
— |
— |
— |
— |
17,245 |
117,956 |
PSU award |
5/23/2023 |
— |
— |
— |
19,201 |
38,402 |
57,603 |
— |
248,077 |
Arnold Goldstein |
|
|
|
|
|
|
|
|
|
Cash award |
— |
43,750 |
87,500 |
N/A |
— |
— |
— |
— |
— |
RSU award |
9/9/2022 |
— |
— |
— |
— |
— |
— |
17,245 |
117,956 |
PSU award |
5/23/2023 |
— |
— |
— |
19,201 |
38,402 |
57,603 |
— |
248,077 |
John W. Sobba |
|
|
|
|
|
|
|
|
|
Cash award |
— |
43,750 |
87,500 |
N/A |
— |
— |
— |
— |
— |
RSU award |
9/9/2022 |
— |
— |
— |
— |
— |
— |
16,925 |
115,767 |
PSU award |
5/23/2023 |
— |
— |
— |
19,201 |
38,402 |
57,603 |
— |
248,077 |
Radiant Logistics, Inc. – 2023 Proxy Statement 51
Outstanding Equity Awards as of June 30, 2023
The following table sets forth information with respect to all outstanding equity awards held by our NEOs as of June 30, 2023.
|
Option Awards |
Stock Awards |
||||||
Name |
Number of Securities Underlying Unexercised Options Exercisable |
Number of Securities Underlying Unexercised Options Unexercisable |
Option Exercise Price |
Option Expiration Date |
|
Number of Shares of Units of Stock that Have Not Vested |
|
Market Value of Shares or Units of Stock that Have Not Vested (1) |
Bohn H. Crain |
2,377 |
— |
5.03 |
5/11/2025 |
(2) |
|
|
|
|
|
|
|
|
|
32,482 |
(3) |
218,279 |
|
|
|
|
|
|
37,674 |
(4) |
253,169 |
|
|
|
|
|
|
87,209 |
(5) |
586,044 |
|
|
|
|
|
|
41,058 |
(6) |
275,910 |
|
|
|
|
|
|
97,926 |
(7) |
658,063 |
Todd E. Macomber |
2,207 |
— |
2.22 |
11/11/2023 |
(8) |
|
|
|
|
1,917 |
— |
3.00 |
2/10/2024 |
(9) |
|
|
|
|
1,886 |
— |
3.07 |
5/12/2024 |
(10) |
|
|
|
|
2,070 |
— |
3.29 |
9/22/2024 |
(11) |
|
|
|
|
1,196 |
— |
4.10 |
11/10/2024 |
(12) |
|
|
|
|
1,175 |
— |
4.50 |
2/11/2025 |
(13) |
|
|
|
|
926 |
— |
5.03 |
5/11/2025 |
(2) |
|
|
|
|
|
|
|
|
|
13,992 |
(3) |
94,026 |
|
|
|
|
|
|
16,229 |
(4) |
109,059 |
|
|
|
|
|
|
34,200 |
(5) |
229,824 |
|
|
|
|
|
|
17,245 |
(6) |
115,886 |
|
|
|
|
|
|
38,402 |
(7) |
258,061 |
Arnold Goldstein |
125,000 |
— |
4.58 |
2/15/2025 |
(14) |
|
|
|
|
|
|
|
|
|
13,992 |
(3) |
94,026 |
|
|
|
|
|
|
16,229 |
(4) |
109,059 |
|
|
|
|
|
|
34,200 |
(5) |
229,824 |
|
|
|
|
|
|
17,245 |
(6) |
115,886 |
|
|
|
|
|
|
38,402 |
(7) |
258,061 |
John W. Sobba |
|
|
|
|
|
13,992 |
(3) |
94,026 |
|
|
|
|
|
|
16,229 |
(4) |
109,059 |
|
|
|
|
|
|
34,200 |
(15) |
229,824 |
|
|
|
|
|
|
16,925 |
(6) |
113,736 |
|
|
|
|
|
|
38,402 |
(7) |
258,061 |
Radiant Logistics, Inc. – 2023 Proxy Statement 52
Option Exercises and Stock Vested During FISCAL YEAR 2023
The table below provides information regarding option awards that were exercised and stock awards that vested for each of our NEOs during the fiscal year ended June 30, 2023.
|
Option Awards(1) |
|
Stock Awards(2) |
|
||||||||
Name |
Number of Shares Acquired on Exercise |
|
Value Realized on Exercise |
|
Number of Shares Acquired on Vesting |
|
Value Realized on Vesting |
|
||||
Bohn H. Crain |
|
|
|
|
|
|
|
|
||||
Stock Options |
|
— |
|
|
— |
|
|
|
|
|
||
Restricted Stock Units |
|
|
|
|
|
38,065 |
|
|
255,797 |
|
||
Todd E. Macomber |
|
|
|
|
|
|
|
|
||||
Stock Options |
|
— |
|
|
— |
|
|
|
|
|
||
Restricted Stock Units |
|
|
|
|
|
16,397 |
|
|
110,188 |
|
||
Arnold Goldstein |
|
|
|
|
|
|
|
|
||||
Stock Options |
|
— |
|
|
— |
|
|
|
|
|
||
Restricted Stock Units |
|
|
|
|
|
16,397 |
|
|
110,188 |
|
||
John W. Sobba |
|
|
|
|
|
|
|
|
||||
Stock Options |
|
— |
|
|
— |
|
|
|
|
|
||
Restricted Stock Units |
|
|
|
|
|
16,397 |
|
|
110,188 |
|
||
POTENTIAL pOST-TERMINATION AND CHANGE IN CONTROL PAYMENTS
Employment Agreements
The employment agreements with our NEOs contain severance provisions, including in connection with a change of control, intended to induce these executives to continue employment with our Company and to retain them and provide consideration to them for certain restrictive covenants that apply following a termination of employment. The receipt of any severance by these executives, other than our CEO, is conditioned upon his execution of a broad release of claims.
Radiant Logistics, Inc. – 2023 Proxy Statement 53
CEO Employment Agreement
Under our employment agreement with our CEO, we may terminate the agreement at any time for cause. If we terminate the agreement due to Mr. Crain’s disability, Mr. Crain’s unvested options will immediately vest and we must continue to pay to Mr. Crain, for an additional one‑year period, his base salary (reduced by any disability insurance payments he receives) and pro-rated bonuses as well as fringe benefits, including participation in pension, profit sharing and bonus plans as applicable, and life insurance, hospitalization, major medical, paid vacation and expense reimbursement. If Mr. Crain terminates the agreement for good reason or we terminate for any reason other than for cause, Mr. Crain’s unvested options will immediately vest and we must continue to pay Mr. Crain for the remaining term of the employment agreement his base salary and the greater of the most recent bonus or target bonus as well as fringe benefits.
The employment agreement also contains a change of control provision. If Mr. Crain’s employment is terminated following a change of control (other than for cause or by Mr. Crain without good reason), then we must pay him (i) a termination payment equal to 2.99 times his basic compensation (the sum of his base salary, bonus and fringe benefits) at the annual rate in effect on the date of termination of his employment, (ii) any bonus amounts to which he would have been entitled for a period of three years following the date of termination equal to the greater of his most recent bonus or his target bonus, (iii) any unpaid expenses and benefits, and (iv) for a period of three years provide him with all fringe benefits he was receiving on the date of termination of his employment or the economic equivalent of such benefits. In addition, all of his unvested stock options will immediately vest as of the termination date of his employment due to a change of control. In the event compensation payable to Mr. Crain upon our change of control causes him to be subject to an excise tax under section 4999 of the Code, he will receive a “gross up” payment in an amount such that after the payment by Mr. Crain of all taxes imposed upon the gross up payment, Mr. Crain will retain an amount of the gross up payment equal to such excise tax. A change of control is generally defined as the occurrence of any one of the following:
Notwithstanding the foregoing, a change of control is not deemed to have occurred (i) in the event of a sale, exchange, transfer or other disposition of substantially all of our assets to, or a merger, consolidation or other reorganization involving, us and any entity in which our chief executive officer has, directly or indirectly, at least a 25% equity or ownership interest, or (ii) in a transaction otherwise commonly referred to as a “management leveraged buy-out.”
Other NEO Employment Agreements
Under the employment agreement with each of our other NEOs, the executive is entitled to six months of severance in the form of salary continuation payments, plus continuation of the medical benefits (and his car allowance in the case of Mr. Goldstein and Mr. Sobba), in the event his employment is terminated as a result of death, disability, or by us for any reason other than cause; or twelve months of severance if, within nine months following a change of control, he voluntarily terminates his employment for good reason or his employment is terminated by us. In addition, if his employment is terminated by him for Good Reason or by us within nine months following a change of control, the vesting of any equity awards will be deemed to have been accelerated to include an additional period of 12 months.
Radiant Logistics, Inc. – 2023 Proxy Statement 54
For the purposes of these employment agreements, a “change of control” will be deemed to occur if there occurs a sale, exchange, transfer or other disposition of substantially all of our assets to another entity, except to an entity controlled directly or indirectly by us, or a merger, consolidation or other reorganization of the Company in which we are not the surviving entity, or a plan of liquidation or dissolution of the Company other than pursuant to bankruptcy or insolvency laws. For the further purpose of the employment agreements, “good reason” will be deemed to occur upon either: (i) a breach of the agreement by us; or (ii), a reduction in salary without the executive’s consent, unless any such reduction is otherwise part of an overall reduction in executive compensation experienced on a pro rata basis by other similarly situated employees.
Other Change in Control Arrangements
The Radiant Logistics, Inc. 2012 Stock Option and Performance Award Plan and Radiant Logistics, Inc. 2021 Omnibus Incentive Plan under which awards have been granted to our NEOs contains “change of control” provisions. Under each plan, without limiting the authority of the Audit and Executive Oversight Committee to adjust awards, if a “change of control” of Radiant Logistics (as defined in the plan) occurs, then, unless otherwise provided in the award or other agreement, if an award is continued, assumed, or substituted by the successor entity, the award will not vest or lapse solely as a result of the change of control but will instead remain outstanding under the terms pursuant to which it has been continued, assumed, or substituted and will continue to vest or lapse pursuant to such terms.
Potential Payments to Named Executive Officers
The table below shows potential payments to our NEOs, not otherwise earned, under various scenarios involving a termination of employment, including in connection with a change of control, and upon a change of control without a termination of employment, assuming a June 30, 2023 termination date. All equity awards are valued at the closing price of our common stock on June 30, 2023, which was $6.72, as reported by the NYSE American.
Name |
Benefit |
Termination without Cause or for Good Reason Outside a Change of Control |
|
Termination without Cause or for Good Reason in Connection with a Change of Control |
|
Voluntary Termination Retirement |
Death or Disability |
|
Change of Control(1) |
|||
Bohn H. Crain |
Severance Pay(2) |
|
1,062,500 |
|
|
1,270,750 |
|
— |
|
423,930 |
|
— |
|
Incentive Pay(3) |
|
262,192 |
|
|
1,570,530 |
|
— |
|
262,192 |
|
— |
|
RSU Award Vesting(4) |
— |
|
|
747,358 |
|
— |
|
229,909 |
|
— |
|
|
PSU Award Vesting(5) |
— |
|
|
1,244,107 |
|
— |
|
390,696 |
|
— |
|
|
Other Benefits(6) |
|
24,620 |
|
|
147,474 |
|
— |
|
24,620 |
|
— |
|
280G Tax Gross-up(7) |
— |
|
|
1,849,809 |
|
— |
— |
|
— |
||
Todd E. Macomber |
Severance Pay(8) |
|
125,000 |
|
|
250,000 |
|
— |
|
125,000 |
|
— |
|
Incentive Pay |
— |
|
— |
|
— |
— |
|
— |
|||
|
RSU Award Vesting(4) |
— |
|
|
318,972 |
|
— |
|
99,037 |
|
— |
|
|
PSU Award Vesting(5) |
— |
|
|
487,885 |
|
— |
|
153,216 |
|
— |
|
|
Other Benefits(9) |
|
12,859 |
|
|
25,717 |
|
— |
|
12,859 |
|
— |
Arnold Goldstein |
Severance Pay(8) |
|
125,000 |
|
|
250,000 |
|
— |
|
125,000 |
|
— |
|
Incentive Pay |
— |
|
— |
|
— |
— |
|
— |
|||
|
RSU Award Vesting(4) |
— |
|
|
318,972 |
|
— |
|
99,037 |
|
— |
|
|
PSU Award Vesting(5) |
— |
|
|
487,885 |
|
— |
|
153,216 |
|
— |
|
|
Other Benefits(9) |
|
12,029 |
|
|
24,058 |
|
— |
|
12,029 |
|
— |
John W. Sobba |
Severance Pay(8) |
|
125,000 |
|
|
250,000 |
|
— |
|
125,000 |
|
— |
|
Incentive Pay |
— |
|
— |
|
— |
— |
|
— |
|||
|
RSU Award Vesting(4) |
— |
|
|
316,821 |
|
— |
|
99,037 |
|
— |
|
|
PSU Award Vesting(5) |
— |
|
|
487,885 |
|
— |
|
153,216 |
|
— |
|
|
Other Benefits(9) |
|
12,772 |
|
|
25,543 |
|
— |
|
12,772 |
|
— |
Radiant Logistics, Inc. – 2023 Proxy Statement 55
CEO Pay Ratio Disclosure
Under Section 953(b) of the Dodd-Frank Act and Item 402(u) of SEC Regulation S-K, we are providing the ratio of the annual total compensation of Bohn H. Crain, our CEO, to the median of the annual total compensation of all employees of our company (other than our CEO). This ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. The SEC rules for identifying the “median employee” and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported by us, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their pay ratios.
For fiscal year 2023:
Radiant Logistics, Inc. – 2023 Proxy Statement 56
To identify our median employee and to calculate the annual total compensation of our median employee and that of our CEO, we used the following methodology, assumptions, and estimates:
audit and executive oversight Committee Interlocks and Insider Participation
None of the members of the Audit and Executive Oversight Committee has or had any relationship requiring disclosure under Item 404 of SEC Regulation S-K or has ever been an officer or employee of Radiant Logistics or any of our subsidiaries. None of our executive officers serves, or in the past has served, as a member of the Compensation Committee, or other committee serving an equivalent function, of any entity that has one or more executive officers who serve as members of the Board or the Audit and Executive Oversight Committee.
PAY VERSUS PERFORMANCE
The following table sets forth compensation information for our principal executive officer (“PEO”), and our NEOs, for purposes of comparing their compensation to the value of our stockholders’ investments and our net income, calculated in accordance with SEC regulations, for fiscal years 2023, 2022, and 2021.
Year |
Summary Compensation Table Total for PEO (1) |
|
Compensation Actually Paid to PEO (2) |
|
Average Summary Compensation Table Total for Non-PEO NEOs (3) |
|
Average Compensation Actually Paid to Non-PEO NEOs (4) |
|
Value of Initial Fixed $100 Investment Based on Total Stockholder Return (5) |
|
Net Income Attributable to Radiant Logistics, Inc. (millions) |
|
||||||
2023 |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Radiant Logistics, Inc. – 2023 Proxy Statement 57
Year |
Summary Compensation Table Total |
|
Grant Date Fair Value of Equity Awards Granted during the Fiscal Year |
|
Year End Fair Value of Equity Awards Granted during the Fiscal Year |
|
One Year Change in Fair Value of Unvested Equity Awards Granted in Prior Fiscal Years |
|
Change in Fair Value from Prior Fiscal Year to Vesting Date for Equity Awards Vested |
|
Compensation Actually Paid to PEO |
|
||||||
2023 |
$ |
|
$ |
( |
) |
$ |
|
$ |
( |
) |
$ |
( |
) |
$ |
|
|||
2022 |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
||||
2021 |
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|||||
Year |
Summary Compensation Table Total |
|
Grant Date Fair Value of Equity Awards Granted during the Fiscal Year |
|
Year End Fair Value of Equity Awards Granted during the Fiscal Year |
|
One Year Change in Fair Value of Unvested Equity Awards Granted in Prior Fiscal Years |
|
Change in Fair Value from Prior Fiscal Year to Vesting Date for Equity Awards Vested |
|
Average Compensation Actually Paid to Non-PEO NEOs |
|
||||||
2023 |
$ |
|
$ |
( |
) |
$ |
|
$ |
( |
) |
$ |
( |
) |
$ |
|
|||
2022 |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
||||
2021 |
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|||||
RELATIONSHIP BETWEEN COMPENSATION ACTUALLY PAID AND FINANCIAL PERFORMANCE MEASURES
The following graphs further illustrate the relationship between the pay and performance figures that are included in the pay versus performance tabular disclosure above. As noted above, “compensation actually paid” for purposes of the tabular disclosure and the following graphs were calculated in accordance with SEC rules and do not fully represent the actual final amount of compensation earned by or actually paid to our NEOs during the applicable years.
Compensation Actually Paid and Net Income. As demonstrated by the following graphs, the amount of compensation actually paid to our NEOs is aligned with our net income over the three years presented in the table. While we do not use net income as a performance measure in our overall executive compensation program, the performance measure of net income is correlated with the performance measure of adjusted EBITDA, which we use when setting goals for our short-term incentive program and long-term incentive program, respectively. As described in more detail under “Compensation Discussion and Analysis,” our performance-based compensation elements are designed to reward both annual performance (under the short-term incentive program) and longer-term performance (under the long-term incentive program).
Radiant Logistics, Inc. – 2023 Proxy Statement 58
Compensation Actually Paid and Company Total Stockholder Return (“TSR”). As demonstrated by the following graph, the amount of compensation actually paid to our NEOs is aligned with our cumulative TSR over the three years presented in the table. The alignment of compensation actually paid with our cumulative TSR over the period presented is because, among other things, a portion of the compensation actually paid to our NEOs is comprised of equity awards, the value of which is driven by our stock price. In addition, it appears our stock price generally correlates with our year-over-year financial results, including net income. As discussed above, net income is correlated with the performance measures of adjusted EBITDA, which we use when setting goals for our short-term incentive program and long-term incentive program, respectively.
Radiant Logistics, Inc. – 2023 Proxy Statement 59
DIRECTOR COMPENSATION
Overview
Our non-employee director compensation program generally is designed to attract and retain experienced and knowledgeable directors and to provide equity-based compensation to align the interests of our directors with those of our stockholders. In fiscal year 2023, our non-employee director compensation was comprised of equity compensation, in the form of annual RSU awards and initial option award to new directors, and cash compensation, in the form of annual retainers. Each of these components is described in more detail below.
Bohn H. Crain, as an employee director, does not receive any additional compensation for his services as a director.
DIRECTOR COMPENSATION Process
The Board of Directors has delegated to the Audit and Executive Oversight Committee the responsibility, among other duties, to review and recommend to the Board of Directors any proposed changes in non-employee director compensation. In connection with such review, the Audit and Executive Oversight Committee is assisted in performing its duties by our Human Resources Department.
In December 2020, the Audit and Executive Oversight Committee engaged Meridian Compensation Partners to review our non-employee director compensation program in addition to our executive compensation program. The review by Meridian Compensation Partners consisted of, among other items, analysis of board compensation trends and a competitive assessment based on a selected group of 14 companies operating in the United States that are more similarly situated to us from a revenue and market capitalization perspective. The 14 companies used in this director benchmarking analysis were part of the same peer group of 26 companies used for the executive compensation analysis. The Audit and Executive Oversight Committee considered this data in determining whether to recommend any changes to our non-employee director compensation program. Overall, the review by Meridian Compensation Partners showed that our non-employee director compensation program was significantly below the market median.
Director Compensation Program
The following table sets forth the cash component of our non-employee director compensation program for fiscal year 2023.
|
($) |
Board Member Retainer |
36,000 |
Audit and Executive Oversight Committee Chair Premium |
14,000 |
Compensation Committee Function Premium |
14,000 |
Nominating Governance Committee Function Premium |
14,000 |
Lead Independent Director |
25,000 |
In addition to cash compensation, our non-employee directors have an opportunity to receive annual RSU awards, based on their annual cash compensation and the Company’s performance relative to a budgeted adjusted EBITDA. The annual RSU awards for fiscal year 2022 were granted on May 23, 2023 under the Radiant Logistics, Inc. 2021 Omnibus Incentive Plan and vest in full on the three-year anniversary of the grant date.
We also reimburse our non-employee directors for reasonable out-of-pocket expenses incurred in connection with the performance of their duties as directors, including, without limitation, travel expenses in connection with their attendance in-person at Board and Board committee meetings.
Radiant Logistics, Inc. – 2023 Proxy Statement 60
Summary Director Compensation Table for FISCAL YEAR 2023
The following table sets forth information concerning the compensation of our non-employee directors during the fiscal year ended June 30, 2023. Bohn H. Crain is not compensated separately for his service as a director, and his compensation is discussed under “Executive Compensation.”
Name |
Fees Earned or Paid in Cash |
Option Awards |
Stock Awards(1) |
All Other Compensation(2) |
Total |
Richard P. Palmieri |
75,000 |
— |
85,589 |
— |
160,589 |
Michael Gould |
50,000 |
— |
66,984 |
— |
116,984 |
Kristin E. Toth |
50,000 |
— |
65,491 |
— |
115,491 |
Policies and Procedures for Review and Approval of Related Party Transactions
Our Audit and Executive Oversight Committee is responsible for the oversight of related party transactions. In accordance with the Audit and Executive Oversight Committee’ Charter, the Company is prohibited from entering into a related party transaction unless such transaction is approved by the Audit and Executive Oversight Committee after a review of the transaction by the Audit and Executive Oversight Committee for potential conflicts of interest. A transaction will be considered a “related party transaction” if the transaction would be required to be disclosed under Item 404 of SEC Regulation S-K. Related party transactions, if any, are reviewed quarterly by the Audit and Executive Oversight Committee.
Transactions with Related Persons
For the period beginning on July 1, 2021, to the date of this proxy statement, the following are our current arrangements with related parties:
Employment and Other Agreements with Named Executive Officers
We have entered into an employment agreement with each of our named executive officers. These agreements were entered into with these individuals in connection with their capacities as officers and provide for salary, bonus, and other benefits, including the grant of equity awards, and severance upon a termination of employment under certain circumstances. Please see the sections above entitled “Executive Compensation—Employment Agreements” for a description of these agreements.
Other Related Party Transactions
On June 28, 2006, we joined with Radiant Capital Partners, LLC, an affiliate of Mr. Crain, our founder and Chief Executive Officer, to form Radiant Logistics Partners, LLC. RLP commenced operations in 2007 as a minority-owned business enterprise for the purpose of enabling us to expand the scope of our service offerings to include participation in certain supplier diversity programs that would have otherwise not been available to us. RLP is owned 60% by Mr. Crain and 40% by the Company.
Radiant Logistics, Inc. – 2023 Proxy Statement 61
In the course of evaluating and approving the ownership structure, operations and economics emanating from RLP, a committee consisting of the independent Board member of the Company considered, among other factors, the significant benefits provided to us through association with a minority business enterprise, particularly as many of our largest current and potential customers have a need for diversity offerings. In addition, the committee concluded the economic relationship with RLP was on terms no less favorable to us than terms generally available from unaffiliated third parties.
For the fiscal year ended June 30, 2023, RLP recorded $1,099,103 in commission revenues earned from members of the affiliated group and reported a profit of $1,077,109. For the fiscal year ended June 30, 2022, RLP recorded $1,758,774 in commission revenues earned from members of the affiliated group and reported a profit of $1,711,910.
STOCK OWNERSHIP
Significant Beneficial Owners
The table below sets forth information as to individuals and entities (other than officers or directors) that have reported to the SEC or have otherwise advised us that they are a beneficial owner, as defined by the SEC’s rules and regulations, of more than five percent of our outstanding common stock.
Title of Class |
Name and Address of Beneficial Owner |
Amount and nature of Beneficial Ownership |
Percent of Class(1) |
Common Stock |
BlackRock, Inc(2) |
2,736,627 |
5.6% |
Common Stock |
Dimensional Fund Advisors LP(3) |
2,736,259 |
5.6% |
Security Ownership by Management
The table below sets forth information known to us regarding the beneficial ownership of our common stock as of September 22, 2023, by:
To our knowledge, each person named in the table has sole voting and investment power with respect to all of the securities shown as beneficially owned by such person, except as otherwise set forth in the notes to the table and subject to community property laws, where applicable. The number of shares beneficially owned represents the number of shares the person “beneficially owns,” as determined by the rules of the SEC. The SEC has defined “beneficial” ownership of a security to mean the possession, directly or indirectly, of voting power and/or investment power. A stockholder is also deemed to be, as of any date, the beneficial owner of all securities that such stockholder has the right to acquire within 60 days after that date through (i) the vesting of restricted stock units or the exercise of any option, warrant, or right; (ii) the conversion of a security; (iii) the power to revoke a trust, discretionary account, or similar arrangement; or (iv) the automatic termination of a trust, discretionary account, or similar arrangement.
Radiant Logistics, Inc. – 2023 Proxy Statement 62
Title of Class |
Name of Beneficial Owner |
Title/Position |
Amount and Nature of Beneficial Ownership(1)(2) |
Percent of Class (3) |
Common Stock |
Bohn H. Crain |
Chairman of the Board and Chief Executive Officer |
10,175,261 |
21.3% |
Common Stock |
Michael Gould |
Director |
782,423 |
1.6% |
Common Stock |
Todd E. Macomber |
Senior Vice President, Chief Financial Officer and Treasurer |
326,211 |
* |
Common Stock |
Richard P. Palmieri |
Director |
245,722 |
* |
Common Stock |
Arnold Goldstein |
Senior Vice President and Chief Commercial Officer |
147,988 |
* |
Common Stock |
Kristin E. Toth |
Director |
40,000 |
* |
Common Stock |
John W. Sobba |
Senior Vice President and General Counsel |
24,814 |
* |
|
All officers and directors as a group (7 persons) |
11,742,419 |
24.5% |
|
* Indicates beneficial ownership of less than 1% of the total outstanding common stock.
Name |
Number of Restricted Stock Units Issuable |
Michael Gould |
6,719 |
Richard P. Palmieri |
6,719 |
Name |
Number of Shares Issuable upon Exercise of Vested Options |
Bohn H. Crain |
2,377 |
Michael Gould |
100,000 |
Todd E. Macomber |
9,170 |
Richard P. Palmieri |
200,000 |
Arnold Goldstein |
125,000 |
Kristin E. Toth |
40,000 |
Stock Ownership Guidelines
In September 2021, we established stock ownership and retention guidelines that are intended to further align the interests of our directors and named executive officers with those of our stockholders. The stock ownership guidelines for our non-employee directors and named executive officers are as follows:
Position |
Guideline |
Non-Employee Director |
2x annual cash retainer |
Chief Executive Officer |
4x annual base salary |
Other Named Executive Officers |
1x annual base salary |
Each director and named executive officer has five years from the date of appointment or hire or, if the ownership multiple has increased during his tenure, five years from the date established in connection with such increase to reach their stock ownership targets. Until the applicable stock ownership guideline is achieved as described above, each director and NEO is required to retain an amount equal to 100% of the net shares received as a result of the vesting of restricted stock, restricted stock units or other equity-based awards or the exercise of stock options. “Net shares” are those shares that remain after shares are sold or netted to pay the exercise price of stock options (if applicable) and any applicable withholding or estimated taxes associated with the restricted stock, restricted stock unit, stock option, or other equity-based incentive award. All of our directors and named executive officers are in compliance with our stock ownership guidelines, taking into account the five-year compliance deadline.
Radiant Logistics, Inc. – 2023 Proxy Statement 63
Securities Authorized for Issuance Under Equity Compensation Plans
The table below provides information about our common stock that may be issued under our equity compensation plans as of June 30, 2023.
Plan Category |
Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants, and Rights (a) |
|
Weighted-Average Exercise Price of Outstanding Options, Warrants, and Rights(1) (b) |
|
Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) |
|
|||
Equity compensation plans not approved by security holders |
|
— |
|
$ |
— |
|
|
— |
|
Equity compensation plans approved by security holders |
|
946,514 |
|
$ |
4.37 |
|
|
2,351,032 |
|
Total |
|
946,514 |
|
|
|
|
2,351,032 |
|
|
INFORMATION ABOUT THE 2023 ANNUAL MEETING
The Board of Directors is using this proxy statement to solicit your proxy for use at our 2023 Annual Meeting of Stockholders. The Board is soliciting proxies to give all stockholders of record an opportunity to vote on matters properly presented at the Annual Meeting.
We also make available our proxy materials online. All stockholders may request to receive a printed set of the proxy materials. Instructions on how to request a printed copy by mail or electronically may be found on the Internet Notice and on the website referred to in the Internet Notice, including an option to request paper copies on an ongoing basis.
When and where will the Annual Meeting be held?
The Annual Meeting will be held on Wednesday, November 15, 2023, at 9:00 a.m., Local Time at our principal executive offices located at Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057.
Directions to attend the Annual Meeting may be obtained by calling Investor Relations at (425) 943-4541.
what is THE PURPOSE OF THE Annual Meeting?
The purpose of the Annual Meeting is to vote on the following items described in this proxy statement:
Proposal |
Item of Business |
Proposal No. 1 |
Election of Directors |
Proposal No. 2 |
Ratification of Appointment of Independent Registered Public Accounting Firm |
Proposal No. 3 |
Advisory Vote on Executive Compensation |
There are no rights of appraisal or similar rights of dissenters arising from matters to be acted on at the meeting.
are there any matters to be voted on at the annual meeting that are not included in this proxy statement?
We currently are not aware of any business that will be presented at the Annual Meeting other than as described in this proxy statement. If, however, any other matter is properly brought at the Annual Meeting, or any continuation, postponement, or adjournment thereof, your proxy includes discretionary authority on the part of the individuals appointed to vote your shares or act on those matters in accordance with their best judgment.
Radiant Logistics, Inc. – 2023 Proxy Statement 64
who CAN ATTEND the Annual Meeting?
All of our stockholders entitled to vote at the Annual Meeting may attend the Annual Meeting. If your shares are held in street name, however, you may not vote your shares in person at the Annual Meeting unless you obtain a legal proxy from the record holder of your shares. Stockholders who wish to attend the Annual Meeting will be required to present verification of ownership of our common stock, such as a bank or brokerage firm account statement, and will be required to present a valid, government-issued picture identification, such as a driver’s license or passport, to gain admittance to the Annual Meeting. No cameras, recording equipment, electronic devices, large bags, briefcases, or packages will be permitted in the Annual Meeting.
who IS ENTITLED TO VOTE AT the Annual Meeting?
Holders of record of shares of our common stock as of the close of business on September 22, 2023, the record date, will be entitled to notice of and to vote at the Annual Meeting and any continuation, postponement, or adjournment thereof. At the close of business on the record date, there were 47,388,981 shares of our common stock issued and outstanding and entitled to vote. Each share of our common stock is entitled to one vote on any matter presented to stockholders at the Annual Meeting.
how MANY SHARES MUST BE PRESENT?
A quorum must be present at the Annual Meeting for any business to be conducted. The presence at the Annual Meeting, in person or by proxy, of the holders of a majority in voting power of the Company’s capital stock issued and outstanding and entitled to vote on the record date will constitute a quorum. Your shares will be counted toward the quorum if you submit a proxy or vote at the Annual Meeting. Shares represented by proxies marked “abstain” and “broker non-votes” also are counted in determining whether a quorum is present.
what IF A QUORUM IS NOT PRESENT?
If a quorum is not present or represented at the scheduled time of the Annual Meeting, a majority in voting power of the stockholders entitled to vote at the Annual Meeting, present in person or represented by proxy, may adjourn the Annual Meeting until a quorum is present or represented.
how DO I VOTE?
We recommend stockholders vote by proxy even if they attend the Annual Meeting.
If you are a stockholder of record and are voting by proxy, your vote must be received by 11:59 p.m. (Eastern Time) on November 14, 2023 to be counted. |
If you are a stockholder of record, there are three ways to vote by proxy:
Telephone and Internet voting facilities for stockholders of record will be available 24 hours a day and will close at 11:59 p.m., Eastern Time, on November 14, 2023. If you vote through the Internet, you should be aware that you may incur costs to access the Internet, such as usage charges from telephone companies or Internet service providers, and that these costs must be borne by you.
Radiant Logistics, Inc. – 2023 Proxy Statement 65
If your shares are held in the name of a bank, broker, or other holder of record, you will receive instructions on how to vote from the bank, broker, or holder of record. You must follow the instructions of such bank, broker, or holder of record in order for your shares to be voted. Telephone and Internet voting also may be offered to stockholders owning shares through certain banks and brokers. If your shares are not registered in your own name and you would like to vote your shares in person at the Annual Meeting, you should contact your bank, broker, or agent to obtain a legal proxy or the bank’s or broker’s proxy card and bring it to the Annual Meeting in order to vote.
what IS THE DIFFERENCE BETWEEN BEING A “RECORD HOLDER” AND HOLDING SHARES IN “STREET NAME”?
A record holder holds shares in his or her name. Shares held in “street name” are held in the name of a bank or broker on a person’s behalf.
CAN i VOTE IF MY SHARES ARE HELD IN “STREET NAME”?
Yes. If your shares are held by a bank or a brokerage firm, you are considered the “beneficial owner” of those shares held in “street name.” If your shares are held in street name, these proxy materials are being forwarded to you by your bank or brokerage firm along with a voting instruction card. As the beneficial owner, you have the right to direct your bank or brokerage firm how to vote your shares, and your bank or brokerage firm is required to vote your shares in accordance with your instructions.
what ARE BROKER NON-VOTES?
Generally, broker non-votes occur when shares held by a broker in “street name” for a beneficial owner are not voted with respect to a particular proposal because the broker (1) has not received voting instructions from the beneficial owner and (2) lacks discretionary voting power to vote those shares.
A broker is entitled to vote shares held for a beneficial owner on routine matters. The ratification of the appointment of Moss Adams, LLP as our independent registered public accounting firm in Proposal No. 2 is a routine matter; and accordingly, a broker is entitled to vote shares held for a beneficial owner on that proposal without instructions from such beneficial owner. On the other hand, absent instructions from a beneficial owner, a broker is not entitled to vote shares held for such beneficial owner on non-routine matters. We believe, based on the rules of the NYSE, that the election of directors in Proposal No. 1, and the advisory vote on executive compensation in Proposal No. 3 are non-routine matters; and accordingly, brokers do not have authority to vote on such matters absent instructions from beneficial owners. Whether a voting proposal is ultimately determined routine or non-routine is determined by the NYSE. Accordingly, if beneficial owners desire not to have their shares voted by a broker in a certain manner, they should give instructions to their brokers as to how to vote their shares.
Broker non-votes count for purposes of determining whether a quorum is present.
The Board recommends that you vote:
If you return a properly completed proxy card, or vote your shares by telephone or Internet, your shares of common stock will be voted on your behalf as you direct. If not otherwise specified, the shares of common stock represented by the proxies will be voted in accordance with the Board’s recommendations.
Radiant Logistics, Inc. – 2023 Proxy Statement 66
WHAT IS THE REQUIRED VOTE FOR EACH PROPOSAL?
Proposal |
Votes Required |
Effect of Abstentions |
Effect of Broker Non-Votes |
|
Proposal No. 1: Election of Directors |
Majority of votes cast. This means that nominees receiving more “FOR” votes than “AGAINST” votes will be elected as directors. Nominees receiving more “AGAINST” votes than “FOR” votes are expected to tender their resignation. |
Abstentions will have no effect. |
Broker non-votes will have no effect. |
|
Proposal No. 2: Ratification of Appointment of Independent Registered Public Accounting Firm |
Affirmative vote of the holders of a majority in voting power of the shares of common stock present in person or by proxy and entitled to vote thereon. |
Abstentions will have the effect of a vote against the proposal. |
We do not expect any broker non-votes on this proposal. |
|
Proposal No. 3: Advisory Vote on Executive Compensation |
Affirmative vote of the holders of a majority in voting power of the shares of common stock present in person or by proxy and entitled to vote thereon. |
Abstentions will have the effect of a vote against the proposal. |
Broker non-votes will have no effect. |
|
what IF I DON’T SPECIFY HOW MY SHARES ARE TO BE VOTED?
If you submit a proxy but do not indicate any voting instructions, the persons named as proxies will vote in accordance with the recommendations of the Board, as described above.
what DOES IT MEAN IF I RECEIVE MORE THAN ONE INTERNET NOTICE OR SET OF PROXY MATERIALS?
It means that your shares are held in more than one account at the transfer agent and/or with banks or brokers. Please vote all of your shares. To ensure that all of your shares are voted, for each Internet Notice or set of proxy materials, please submit your proxy by phone, via the Internet, or, if you received printed copies of the proxy materials, by signing, dating, and returning the enclosed proxy card in the enclosed envelope.
CAN I REVOKE OR CHANGE MY VOTE?
Yes. If you are a registered stockholder, you may revoke your proxy or change your vote at any time before your shares are voted by one of the following methods:
Written notices of revocation and other communications with respect to the revocation of proxies should be addressed to:
Radiant Logistics, Inc.
Triton Towers Two, 700 S. Renton Village Place, Seventh Floor
Renton, Washington 98057
Attention: Corporate Secretary
Radiant Logistics, Inc. – 2023 Proxy Statement 67
Your most recent proxy card or telephone or Internet proxy is the one that is counted. Your attendance at the Annual Meeting by itself will not revoke your proxy unless you give written notice of revocation to the Secretary before your proxy is voted or you vote in person at the Annual Meeting.
If your shares are held in street name, you may change or revoke your voting instructions by following the specific directions provided to you by your bank or broker, or you may vote in person at the Annual Meeting by obtaining a legal proxy from your bank or broker and submitting the legal proxy along with your ballot.
Who will count the votes?
Broadridge Financial Solutions, Inc. has been engaged to tabulate stockholder votes. We will appoint an independent inspector of elections for the Annual Meeting.
where CAN I FIND THE VOTING RESULTS?
We plan to announce preliminary voting results at the Annual Meeting and will report the final results in a Current Report on Form 8-K, which we intend to file with the SEC within four business days after the Annual Meeting.
CAN I GET A PRINTED COPY OF THE PROXY MATERIALS?
Yes. We will mail this proxy statement and our 2023 Annual Report, together with a proxy card, to those stockholders entitled to vote at the Annual Meeting who have properly requested paper copies of such materials, within three business days of our receipt of such request.
OTHER MATTERS
Stockholder Proposals and Director Nominations for 2024 Annual Meeting OF STOCKHOLDERS
Date of 2024 Annual Meeting of Stockholders
We anticipate that our 2024 Annual Meeting of Stockholders will be held on or about Wednesday, November 13, 2024.
Important Dates for Stockholder Submissions
The following are important dates in connection with our 2024 Annual Meeting of Stockholders.
Stockholder Action |
Submission Deadline |
Proposal Pursuant to Rule 14a-8 of the Securities Exchange Act of 1934 |
No later than June 8, 2024 |
Nomination of a Candidate Pursuant to our Bylaws and Rule 14a-19 of the Securities Exchange Act of 1934 |
Between August 15, 2024 and September 14, 2024 |
Proposal of Other Business for Consideration Pursuant to our Bylaws |
Between August 30, 2024 and September 24, 2024 |
Proposals Pursuant to Rule 14a-8
Pursuant to Rule 14a-8 under the Exchange Act, our stockholders may present proper proposals for inclusion in the proxy statement and for consideration at our next annual meeting of stockholders. To be eligible for inclusion in the 2023 Annual Meeting proxy statement, a proposal must be received by us no later than June 8, 2023 and must otherwise comply with Rule 14a-8. While the Board will consider stockholder proposals, we reserve the right to omit from the proxy statement stockholder proposals that we are not required to include under the Exchange Act, including Rule 14a-8.
Radiant Logistics, Inc. – 2023 Proxy Statement 68
Nominations and Proposals Pursuant to Our Bylaws
Stockholders wishing to present proposals for action at an annual meeting apart from proposals pursuant to Rule 14a-8 must do so in accordance with our Bylaws. A stockholder must give timely notice of the proposed business to the Secretary at the executive offices referred to above. To be timely, a stockholder’s notice must be in writing, delivered to or mailed and received at our principal executive offices not less than 50 days nor more than 75 days prior to that year’s annual meeting; provided, however, that in the event less than 60 days’ notice of the meeting is given or made to stockholders, notice by the stockholder, to be timely, must be received no later than the close of business on the tenth day following the date on which such notice of the annual meeting was mailed or public disclosure of the meeting was made, whichever occurs first. For each matter the stockholder proposes to bring before the meeting, the notice to the Secretary must include: (i) a brief description of the business proposed to be brought before the meeting, the reasons for conducting such business at the meeting, and if such business includes a proposal to amend any document, the language of the proposed amendment; (ii) the name and address, as they appear in our books, of the stockholder proposing such business; (iii) the class and number of shares of Company stock that are beneficially owned by the stockholder; and (iv) any material interest of the stockholder in such business. Proxy voting on any matter brought before the meeting as set forth in this paragraph will be subject to the discretionary voting authority of the designated proxy holders.
Stockholders wishing to nominate candidates for election to the Board of Directors at an annual meeting must do so in accordance with our Bylaws and Rule 14a-19 by giving timely notice in writing to the Secretary as described above. To be timely, a stockholder’s notice must be in writing, delivered to or mailed and received at our principal executive offices not less than 60 days nor more than 90 days prior to that year’s annual meeting; provided, however, that in the event less than 70 days’ notice of the meeting is given or made to stockholders, notice by the stockholder, to be timely, must be received no later than the close of business on the tenth day following the date on which such notice of the annual meeting was mailed or public disclosure of the meeting was made, whichever occurs first. The notice must set forth: (i) the nominee’s name, age, business address and, if known, residence address; (ii) such person’s principal place of employment; (iii) the class and number of shares of stock of the corporation that are beneficially owned by such person; and (iv) any other information concerning such person that must be disclosed as to nominees in proxy solicitations pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended. In addition, as to the stockholder giving the notice, the notice must include: (i) the name and record address of such stockholder; and (ii) the class and number of shares of Company stock beneficially owned by such stockholder. The presiding officer at the annual meeting is required to determine whether any nomination was properly brought before the annual meeting in accordance with our Bylaws. If such officer determines that any person has not been properly nominated, such officer shall so declare at the meeting and any such nominee shall not be considered in the election.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Reports of all transactions in our common stock by officers, directors and principal stockholders are required to be filed with the SEC pursuant to Section 16(a) of the Exchange Act. Based solely on our review of copies of the reports received, or representations of such reporting persons, we believe that during fiscal year 2023 no officers, directors or principal stockholders failed to file reports of ownership and changes of ownership on a timely basis.
Cost of Solicitation of Proxies
The Board of Directors is soliciting proxies for the Annual Meeting from our stockholders. We will bear the entire cost of soliciting proxies from our stockholders. In addition to the solicitation of proxies by delivery of the Internet Notice or this proxy statement by mail, we will request that brokers, banks, and other nominees that hold shares of our common stock, which are beneficially owned by our stockholders, send Internet Notices, proxies, and proxy materials to those beneficial owners and secure those beneficial owners’ voting instructions. We will reimburse those record holders for their reasonable expenses. Although we currently do not intend to hire a proxy solicitor to assist in the solicitation of proxies, we reserve the right to do so if we believe it would be in the best interests of Radiant Logistics and our stockholders. If we engage a proxy solicitor, we expect the fees to be approximately $5,000 plus out-of-pocket expenses. We may use several of our regular employees, who will not be specially compensated, to solicit proxies from our stockholders, either personally or by Internet, telephone, facsimile, or special delivery letter.
Radiant Logistics, Inc. – 2023 Proxy Statement 69
Householding of Proxy Materials
The SEC has adopted rules that permit companies and intermediaries (such as banks and brokers) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,” potentially means extra convenience for stockholders and cost savings for companies. A number of banks and brokers with account holders who are our stockholders will be householding our proxy materials. A single proxy statement will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your bank or broker that it will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement and annual report, please notify your bank or broker, direct your written request to Radiant Logistics, Inc., Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, Attention: Investor Relations, or contact Investor Relations by telephone at (425) 943-4541. Stockholders who currently receive multiple copies of the proxy statement at their address and would like to request householding of their communications should contact their bank or broker.
Incorporation by Reference
Notwithstanding anything to the contrary set forth in any of our previous filings under the Securities Act of 1933, as amended, or the Exchange Act, which might incorporate future filings made by us under those statutes, the Audit and Executive Oversight Committee Report under “Proposal No. 2. Ratification of Appointment of Independent Registered Public Accounting Firm” will not be incorporated by reference into any of those prior filings, nor will any such report be incorporated by reference into any future filings made by us under those statutes. In addition, information on our website, other than this proxy statement, notice, and form of proxy, is not part of the proxy soliciting materials and is not incorporated herein by reference.
Radiant Logistics, Inc. – 2023 Proxy Statement 70
Copies of 2023 Annual Report
Our Annual Report on Form-10-K, including the financial statements and management’s discussion and analysis of financial condition and results of operations for the fiscal year ended June 30, 2023, is being sent to stockholders of record as of September 22, 2023 with this proxy statement. This Annual Report on Form 10-K is not to be regarded as proxy soliciting material or as a communication by means of which any solicitation is to be made. Stockholders may also view this proxy statement and our Annual Report on Form 10-K at www.proxyvote.com. Stockholders of record as of September 22, 2023, and beneficial owners of our common stock on that date, may obtain from us without charge additional copies of our Annual Report on Form 10-K filed with the Securities and Exchange Commission, exclusive of the exhibits thereto, by a request in writing. If requested, we will provide stockholders with copies of any exhibits to the Form 10-K upon the payment of a fee covering our reasonable expenses in furnishing the exhibits. Any requests from a beneficial owner of our common stock must set forth a good faith representation that, as of the record date for this solicitation, September 22, 2023, the person making the request was the beneficial owner of our common stock. Such written requests should be directed to us at,: Radiant Logistics, Inc., Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, Attention: Chief Financial Officer.
________________
Your vote is important. Please promptly vote your shares of Radiant Logistics common stock by completing, signing, dating, and returning your proxy card or by Internet or telephone voting as described on your proxy card.
By Order of the Board of Directors
Bohn H. Crain
Chairman of the Board and
Chief Executive Officer
Renton, Washington
October 6, 2023
Radiant Logistics, Inc. – 2023 Proxy Statement 71
ANNEX I – RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
In this proxy statement, we use the terms adjusted EBITDA, adjusted EBITDA margin, adjusted net income, and adjusted gross profit, which are non-GAAP financial measures. These non-GAAP financial measures are presented to provide stockholders additional information to facilitate the comparison of our past and present operations. We believe non-GAAP financial measures provide useful information to investors because they are used to evaluate our performance on a comparable year-over-year basis. Non-GAAP financial measures are not in accordance with, or an alternative for, measures calculated in accordance with U.S. generally accepted accounting principles (GAAP) and may be different from non-GAAP financial measures used by other companies. In addition, non-GAAP financial measures are not based on any comprehensive or standard set of accounting rules or principles. Accordingly, the calculation of our non-GAAP financial measures may differ from the definitions of other companies using the same or similar names limiting, to some extent, the usefulness of such measures for comparison purposes. Non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with our financial results as determined in accordance with GAAP. These measures should only be used to evaluate our financial results in conjunction with the corresponding GAAP measures. Accordingly, we qualify our use of non-GAAP financial information in a statement when non-GAAP financial information is presented.
Adjusted gross profit
The following table presents a reconciliation of our adjusted gross profit and adjusted gross profit percentage, which are non-GAAP financial measures, to the most directly comparable GAAP measure.
|
Year Ended June 30, |
|
|||||
(In thousands) |
2023 |
|
|
2022 |
|
||
Revenues |
$ |
1,085,486 |
|
|
$ |
1,459,419 |
|
Cost of transportation and other services (exclusive of depreciation and amortization, shown |
|
(801,646 |
) |
|
|
(1,153,134 |
) |
Depreciation and amortization |
|
(12,961 |
) |
|
|
(12,775 |
) |
GAAP gross profit |
$ |
270,879 |
|
|
|
293,510 |
|
Depreciation and amortization |
|
12,961 |
|
|
|
12,775 |
|
Adjusted gross profit |
$ |
283,840 |
|
|
$ |
306,285 |
|
|
|
|
|
|
|
||
GAAP gross margin (GAAP gross profit as a percentage of revenues) |
|
25.0 |
% |
|
|
20.1 |
% |
Adjusted gross profit percentage (adjusted gross profit as a percentage of revenues) |
|
26.1 |
% |
|
|
21.0 |
% |
Radiant Logistics, Inc. – 2023 Proxy Statement 72
adjusted EBITDA and adjusted EBITDA margin
The following table presents a reconciliation of our adjusted EBITDA and adjusted EBITDA margin, which are non-GAAP financial measures, to the most directly comparable GAAP measure.
|
Year Ended June 30, |
|
|||||
(In thousands) |
2023 |
|
|
2022 |
|
||
Net income attributable to Radiant Logistics, Inc |
$ |
20,595 |
|
|
$ |
44,464 |
|
Income tax expense |
|
6,305 |
|
|
|
12,692 |
|
Depreciation and amortization |
|
23,157 |
|
|
|
18,716 |
|
Net interest expense |
|
1,889 |
|
|
|
3,191 |
|
|
|
|
|
|
|
||
EBITDA |
|
51,946 |
|
|
|
79,063 |
|
|
|
|
|
|
|
||
Share-based compensation |
|
2,503 |
|
|
|
1,798 |
|
Change in fair value of contingent consideration |
|
(646 |
) |
|
|
767 |
|
Acquisition related costs |
|
185 |
|
|
|
596 |
|
Ransomware incident related costs, net |
|
6 |
|
|
|
684 |
|
Litigation costs |
|
1,208 |
|
|
|
568 |
|
Gain on litigation settlement, net |
|
30 |
|
|
|
— |
|
Change in fair value of interest rate swap contracts |
|
(383 |
) |
|
|
(1,840 |
) |
Gain from debt forgiveness |
|
1,544 |
|
|
|
— |
|
Foreign currency transaction loss |
|
(755 |
) |
|
|
(718 |
) |
|
|
|
|
|
|
||
Adjusted EBITDA |
$ |
55,638 |
|
|
$ |
80,918 |
|
Adjusted EBITDA as a % of adjusted gross profit(1) |
|
19.6 |
% |
|
|
26.4 |
% |
(1) Adjusted gross profit is revenues net of cost of transportation and other services.
Radiant Logistics, Inc. – 2023 Proxy Statement 73
RADIANT LOGISTICS, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF RADIANT LOGISTICS, INC. FOR THE ANNUAL MEETING OF STOCKHOLDERS
The undersigned revokes all previous proxies and constitutes and appoints Bohn H. Crain and Todd E. Macomber, and each of them, his or her true and lawful agent and proxy with full power of substitution in each, to represent and to vote on behalf of the undersigned all of the shares of common stock of Radiant Logistics, Inc. (the “Company”) which the undersigned is entitled to vote at the Annual Meeting of Stockholders of the Company to be held at Triton Towers Two, 700 S. Renton Village Place, Seventh Floor, Renton, Washington 98057, at 9:00 a.m., Local Time, on November 15, 2023, and at any adjournment(s) or postponement(s) thereof, upon the Proposals more fully described in the Notice of Annual Meeting of Stockholders and Proxy Statement for the Annual Meeting (receipt of which is hereby acknowledged).
This proxy, when properly executed will be voted in the manner directed herein by the undersigned stockholder. If no direction is made, this proxy will be voted FOR all of the nominees in Proposal 1, FOR Proposal 2, and Proposal 3, and in the proxies’ discretion, upon other matters as may properly come before the Annual Meeting.
(Continued and to be signed on reverse side)
Radiant Logistics, Inc. – 2023 Proxy Statement 74
Please Detach and Mail In the Envelope Provided
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
|
|
|
|
|||||||||||||||||||||
The Board of Directors recommends you vote FOR the following: |
|
|
|
For |
|
Against |
|
Abstain |
||||||||||||||||
|
|
|
|
|||||||||||||||||||||
1 |
|
Election of Directors |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
Nominees |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
1a. Bohn H. Crain |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
1b. Richard P. Palmieri |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
1c. Michael Gould |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
1d. Kristin E. Toth |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|||||||||||||||||||||
The Board of Directors recommends you vote FOR the following proposals: |
|
|
|
For |
|
Against |
|
Abstain |
||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||
2 |
|
To ratify the appointment of Moss Adams, LLP as the Company’s independent auditor for the fiscal year ending June 30, 2024. |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
3 |
|
To approve, on an advisory basis, our executive compensation. |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||
NOTE: IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON OTHER MATTERS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING. |
|
|
|
|
|
|
|
|
||||||||||||||||
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
Yes |
|
No |
|||||||||||||||
|
|
Please indicate if you plan to attend this meeting. |
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer.
|
|
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||
Signature [PLEASE SIGN WITHIN BOX] |
|
Date |
|
Signature (Joint Owners) |
|
Date |
||||||||||||||||||
Radiant Logistics, Inc. – 2023 Proxy Statement 75