Form 4: RXO Inc. Executive Jason S. Kerr Reports Acquisition of Restricted Stock Units

Jason S. Kerr, Chief Accounting Officer of RXO, Inc., reports the acquisition of restricted stock units (RSUs) and performance-based restricted stock units (PSUs) on February 28, 2025.

Summary

• On February 28, 2025, Jason S. Kerr, the Chief Accounting Officer of RXO, Inc., acquired 2,883 Performance Based Restricted Stock Units (PSUs) and 6,106 Restricted Stock Units (RSUs).
• The PSUs were granted in March 2024 and are based on performance over three separate one-year periods (2024, 2025, and 2026).
• The PSUs earned over the first performance period (January 1, 2024 December 31, 2024) are based on Total Shareholder Return compared to the S&P Transportation Select Industry Index.
• The RSUs vest in three equal annual installments, contingent upon continued employment.
• Kerr also was awarded 6,107 PSUs at target level, which will be eligible to vest depending on the achievement of total shareholder return relative to companies in the S&P Transportation Select Industry Index and will be reported when the number of shares earned is determined.
• Following the transaction, Kerr directly owns 17,452 RSUs.

Sentiment

Score: 6

Explanation: The sentiment is neutral. It's a routine disclosure of stock grants to an executive. The positive aspect is the alignment of executive incentives with shareholder value, but there are also risks associated with performance targets and continued employment.

Positives

• The granting of PSUs aligns executive compensation with shareholder returns, incentivizing performance relative to industry peers.
• The vesting schedule of the RSUs encourages continued employment and commitment from the executive.

Risks

• The value of the PSUs is contingent on RXO's performance relative to the S&P Transportation Select Industry Index, which may be subject to market volatility.
• The vesting of RSUs is dependent on continued employment, creating a potential risk if the executive leaves the company.

Future Outlook

The number of shares earned from the 6,107 PSUs awarded at target level will be reported when the achievement of total shareholder return relative to companies in the S&P Transportation Select Industry Index is determined.

Industry Context

The granting of stock-based compensation is a common practice in the transportation and logistics industry to align executive interests with those of shareholders and incentivize long-term value creation.

Comparison to Industry Standards

• Companies like C.H. Robinson, J.B. Hunt, and Knight-Swift Transportation also utilize stock-based compensation as part of their executive pay packages.
• The specific terms of the PSUs, such as the performance metrics and vesting schedules, are tailored to RXO's strategic goals and competitive landscape.

Stakeholder Impact

• Shareholders may view the stock grants positively as they align executive compensation with company performance.
• Employees may be motivated by the potential for similar stock-based compensation opportunities.

Next Steps

• The reporting person will report the number of shares earned from the 6,107 PSUs at target level when the achievement of total shareholder return relative to companies in the S&P Transportation Select Industry Index is determined.
• The RSUs will vest in three equal annual installments on the first, second and third anniversaries of the grant date, generally subject to the Reporting Person's continued employment with the Issuer through the applicable vesting date.

Key Dates