SCHEDULE: Clearlake Capital Proposes Cash Acquisition of Remaining Forward Air Shares

Clearlake Capital Group, L.P. and its affiliates have submitted a non-binding proposal to acquire all outstanding shares of Forward Air Corporation they do not already own for cash consideration.

Summary

• This filing is Amendment No. 1 to the initial Schedule 13D filed on August 14, 2024, by Clearlake Capital Group, L.P., Jose Enrique Feliciano, and Behdad Eghbali (the "Reporting Persons") regarding Forward Air Corporation's Common Stock.
• The Reporting Persons anticipate submitting one or more non-binding proposals to Forward Air's Board of Directors to acquire all outstanding shares of Common Stock they do not already own for cash consideration.
• This proposal is in connection with the Issuer's Board of Directors' publicly announced review of strategic alternatives.
• The Reporting Persons collectively beneficially own 3,825,000 shares of Common Stock, representing approximately 12.6% of the issued and outstanding shares.
• The ownership percentage is based on 30,423,221 shares of Common Stock issued and outstanding as of May 2, 2025, as reported by Forward Air Corporation in its Quarterly Report on Form 10-Q filed on May 7, 2025.

Sentiment

Score: 7

Explanation: The filing indicates a significant shareholder's intent to make a cash offer for the remaining shares, which could lead to a favorable outcome for existing shareholders. However, the non-binding nature of the proposal and the explicit lack of assurance regarding its consummation introduce considerable uncertainty.

Positives

• The Reporting Persons anticipate submitting a non-binding proposal to acquire all outstanding shares for cash, potentially offering a liquidity event and premium for existing shareholders.
• The proposal aligns with the Issuer's Board of Directors' publicly announced review of strategic alternatives, indicating a structured process for evaluating the company's future.

Negatives

• The proposal is non-binding and does not obligate the Reporting Persons or the Issuer to negotiate or enter into definitive transaction documentation.
• There is no assurance that any definitive transaction agreement will be entered into or that a Proposed Transaction will be consummated.
• The specific terms of any potential transaction are not assured.
• The Reporting Persons reserve the right to modify or withdraw any proposal at any time.

Risks

• Uncertainty of Proposed Transaction: There is no guarantee that a definitive agreement will be reached or that the transaction will be consummated, even if the Issuer accepts a proposal.
• Terms of Transaction Not Assured: The specific terms of any potential transaction, including the cash consideration, are not guaranteed.
• Proposal Withdrawal Risk: The Reporting Persons reserve the right to modify or withdraw any proposal at any time, which could leave shareholders without the anticipated liquidity event.
• Delisting Risk: If a Proposed Transaction is consummated, the Common Stock would become eligible for termination of registration under the Exchange Act and would be delisted from the Nasdaq Global Select Market.

Future Outlook

The Reporting Persons anticipate submitting non-binding proposals to acquire all outstanding shares of Common Stock they do not already own for cash. They intend to continue communications with the Issuer's management, Board, and shareholders regarding strategic alternatives and opportunities to increase shareholder value. They reserve the right to modify or withdraw any proposal at any time. If a Proposed Transaction is not consummated, the Reporting Persons may, at any time, review, reconsider, or change their position, which could include purchasing additional shares, selling their current holdings, pursuing extraordinary corporate transactions, or seeking to influence the Board or management.

Industry Context

This filing indicates a potential consolidation or significant strategic shift within the logistics or transportation sector, as a major shareholder seeks to take the company private. Such moves often occur in industries undergoing transformation or where private equity sees opportunities for operational improvements or market repositioning, potentially signaling a belief in undervalued assets or opportunities for efficiency gains.

Stakeholder Impact

• Shareholders: Potential for a cash acquisition of their shares, possibly at a premium, offering liquidity. However, there is also the risk of the proposal not materializing or being withdrawn, leading to uncertainty.
• Management/Board: Engaged in a review of strategic alternatives, facing a significant shareholder's acquisition proposal, which could lead to changes in control or business strategy.
• Employees: While not directly addressed, a change in ownership or corporate structure resulting from a potential acquisition could have future implications for employees regarding employment, compensation, or company culture.

Next Steps

• The Reporting Persons anticipate submitting one or more non-binding proposals to Forward Air's Board of Directors.
• The Reporting Persons and their affiliates expect to respond to inquiries from, and negotiate the terms of a Proposal with, the Issuer and its representatives.
• The Reporting Persons intend to continue to engage in communications with the Issuer's management, Board, shareholders, and advisors regarding strategic alternatives, shareholder value, operations, governance, and control.
• If a Proposed Transaction is not consummated, the Reporting Persons may review, reconsider, or change their position, including potentially purchasing or selling more shares, pursuing extraordinary corporate transactions, or seeking to influence the Board or management.

Key Dates

Recommendation

Keywords

Forward Air Corporation, Clearlake Capital, Schedule 13D, acquisition proposal, strategic alternatives, cash consideration, beneficial ownership, corporate governance, M&A, logistics, transportation