Shawn Stewart
FORWARD AIRAbout Shawn Stewart
Shawn Stewart, age 51, has served as Forward Air’s Chief Executive Officer and a director since April 2024, following a 29-year logistics career at CEVA/EGL and prior service in the U.S. Navy (1992–1998) . His 2024 CEO pay structure set base salary at $900,000 with a 100% target bonus (200% max) and an inducement equity package; 2024 actual compensation (partial-year) totaled $4,564,259 driven by equity grants and a pro-rated annual incentive . 2024 performance context was challenging: value of a $100 investment in FWRD fell to $46 with relative TSR at the 0th percentile and a net loss of $(820) million; the pay-versus-performance table reflects this dynamic environment during leadership transition . The Board separated the CEO and Chair roles (independent Chairman George S. Mayes) to allow Stewart to focus on integration and operations, mitigating dual-role governance concerns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CEVA Logistics (formerly EGL) | President & Managing Director, North America; previously EVP Freight Mgmt NA, SVP Ground Transport NA, Regional VP | 1995–2024 (President/MD: 2020–Mar 2024) | Senior leadership across freight, ground transport and regional operations; deep industry operating experience |
| United States Navy | Service member (USS Inchon; USS Theodore Roosevelt); Navy Achievement Medal | 1992–1998 | Leadership and discipline foundation; recognized for exemplary service |
External Roles
| Category | Details |
|---|---|
| Other public company boards | None listed in Stewart’s proxy biography |
Fixed Compensation
| Element | Terms | 2024 Actual |
|---|---|---|
| Base salary | $900,000 annual rate | $588,462 (partial year) |
| Target annual bonus | 100% of base salary; max 200% | $336,000 (pro-rated payout under 2024 plan) |
| Signing/one-time cash | $400,000 signing bonus | $400,000 |
| Benefits/perquisites | Standard employee benefits; minimal perqs | $4,905 (401k match $4,327; LTD $578) |
| Total 2024 comp | — | $4,564,259 |
Performance Compensation
Annual Incentive Plan (2024)
| Metric | Weight | Target | Actual/Payout | Notes |
|---|---|---|---|---|
| Consolidated EBITDA (Credit Agreement definition) | 70% | Not disclosed | 80% of target component | Focused on covenant compliance |
| Unlevered Free Cash Flow (6 months ended 12/31/2024) | 30% | Not disclosed | Committee discretion reduced payout to 0% (could have been 125%) | Ensured pay-for-performance alignment |
| Overall payout | — | — | 56% of target (pro-rated for Stewart) | Stewart’s paid amount: $336,000 |
Long-Term Equity Grants (2024 CEO Inducement)
| Award Type | Grant Date | Shares/Units | Vesting/Performance | Grant-Date Fair Value |
|---|---|---|---|---|
| Restricted Stock | 4/29/2024 | 50,955 | Time-based; vests 1/3 on each of the first, second, third anniversaries of grant (i.e., 4/29/2025, 4/29/2026, 4/29/2027) subject to continuous employment | $1,147,507 |
| Performance Share Units (PSUs) | 4/29/2024 | 76,433 target | 3-year performance period ending 12/31/2026; vests ~2.5 months after period end (mid-March 2027); performance based on relative TSR and/or EBITDA per share per plan; continuous employment required | $2,087,385 |
2024 LTIP payout for the 2022–2024 performance cycle was 0% of target based on relative TSR, underscoring the performance linkage .
Equity Ownership & Alignment
Holdings and Overhang (as disclosed)
| Item | Amount | Valuation/Notes |
|---|---|---|
| Common shares beneficially owned | 0 shares; 16,985 “may be acquired within 60 days” (matched to first RS vest tranche) | 16,985 aligns with 1/3 of 50,955 RS scheduled to vest on 4/29/2025 |
| Unvested Restricted Stock | 50,955 shares | Market value $1,643,299 based on $32.25 (12/31/2024 close) |
| PSUs (target) | 76,433 units | Market value $2,464,964 at $32.25 (12/31/2024) |
| Stock options | None | — |
| Ownership as % outstanding | <1% of class | Record date context provided in proxy |
Alignment Policies
- Executive stock ownership guideline: CEO must hold 6x base salary; until achieved, must retain 50% of net shares from awards; unvested restricted stock counts; options/uneamed PSUs do not .
- Hedging and pledging: Prohibited for executive officers; no margin accounts or pledging of company stock allowed .
- 2024 note: Stock price volatility caused some executives to fall out of compliance; Board monitoring in place (no individual names specified) .
Vesting Calendar and Potential Selling Pressure
- RS tranches scheduled annually on 4/29/2025, 4/29/2026, 4/29/2027 (16,985 shares per tranche), which may create periodic Form 4 activity and tax-withholding share sales around vest dates; hedging/pledging remains prohibited .
Employment Terms
| Term | Details |
|---|---|
| Employment agreement date | April 22, 2024 |
| Role start | CEO appointment in April 2024 |
| Base salary/bonus structure | $900,000 base; 100% target bonus; 200% max |
| Inducement equity | 50,955 RS (time-based) and 76,433 PSUs (performance period to 12/31/2026) |
| Non-compete/non-solicit | 24 months post-employment; confidentiality, non-disparagement, invention assignment covenants |
| Severance plan participation | Yes; company Executive Severance and Change in Control Plan |
| Change-in-control vesting | Double trigger for equity grants since 2016; acceleration if awards not assumed or upon qualifying termination within 24 months post-CIC |
| Enhanced severance (time-limited) | For involuntary “not-for-cause” terminations from 3/15/2024–12/31/2025: receive CIC-level severance and equity acceleration |
| Clawbacks | Dodd-Frank compliant executive officer clawback for restatements; separate discretionary recoupment policy extends to misconduct, negative revisions, policy violations, etc. |
| Tax gross-ups | Severance plan provides no excise tax gross-ups; benefits subject to clawback policies |
Estimated Termination/CIC Economics (as of 12/31/2024)
| Scenario | Severance | Annual Incentive | Accelerated Equity | Insurance Benefits | Outplacement | Total |
|---|---|---|---|---|---|---|
| Involuntary termination (without cause) | $1,800,000 | $336,000 | — | $42,467 | $20,000 | $2,198,467 |
| Death/Disability | — | $336,000 | $2,220,805 | — | — | $2,556,805 |
| Change in control (qualifying termination) | $3,600,000 | $336,000 | $4,108,263 | $42,467 | $20,000 | $8,106,730 |
Board Governance
| Attribute | Details |
|---|---|
| Board service | Director since 2024 |
| Leadership structure | Independent Chairman (George S. Mayes); CEO and Chair roles separated |
| Committee roles | Member, Executive Committee; not on Audit, Compensation, or Corporate Governance/Nominating Committees |
| Committee meeting cadence (2024) | Audit (10), Compensation (10), Corporate Governance & Nominating (5), Executive (0) |
| Director pay policy | Employee directors receive no additional board compensation |
| Dual-role implications | Separation of Chair/CEO mitigates concentration of power and independence concerns during transition |
Compensation Structure Analysis
- Mix and benchmarking: 2024 CEO target package $4.8M (base $900k; target bonus $900k; target LTI $3.0M), with Committee targeting size-adjusted 50th percentile using WTW data; compensation heavily at-risk via annual and long-term incentives .
- Annual incentive metrics tightened to financial covenants (Consolidated EBITDA 70%; Unlevered FCF 30%); Committee applied negative discretion on FCF to 0% (overall payout 56%), signaling discipline amid integration and covenant focus .
- Shift to RS/PSU vs options: 2024 CEO inducement comprised RS and PSUs; company prohibits option repricing/cash-outs without shareholder approval, reinforcing alignment .
- Clawbacks and policies: Robust Dodd-Frank clawback plus discretionary recoupment; hedging/pledging prohibited; strong double-trigger CIC treatment reduces windfall optics .
Performance & Track Record
| Indicator | 2024 Outcome |
|---|---|
| Value of $100 investment in FWRD | $46 |
| Relative TSR percentile | 0th percentile |
| Net income (loss) | $(820) million |
- Context: Significant leadership changes and Omni integration; Board formed Integration Committee (Feb 2024) and left Chair role independent to focus the CEO on operational integration and value creation .
Say-on-Pay, Peer Group, and Committee Practices
- Committee practices: Independent consultant retained by and reporting directly to the Compensation Committee; disclosure of financial metrics and goals; no excise tax gross-ups; meaningful ownership guidelines; risk mitigators applied .
- Benchmarking: Committee aimed around size-adjusted 50th percentile for total target compensation based on WTW survey data .
Equity Ownership & Director Compensation (Board-level reference)
- Independent director compensation: $85,000 annual cash retainer; additional $125,000 for independent Chairman; committee chair and member retainers; annual equity grant ~$130,000 (2024 cash-settled substitute where shares were insufficient) .
- Independent director ownership guidelines: 5x annual cash retainer within five years; unvested restricted stock counts; Board is monitoring compliance given 2024 price volatility .
Employment & Contract Risk Considerations
- Enhanced severance window through 12/31/2025 increases potential severance outflows on involuntary terminations; amended plan shortens adverse-amendment notice to 60 days and removes pro-rata annual incentive for post-1/14/2026 terminations, reducing future severance costs .
- Non-compete/non-solicit at 24 months for CEO reduces leakage risk post-departure .
- No SERP or nonqualified deferred compensation plan; reduces hidden liability risk .
Investment Implications
- Pay-for-performance alignment: 2024 annual incentive paid at 56% of target with explicit negative discretion on FCF, and 0% payout on the 2022–2024 PSU cycle; stewardship signals conservatism during a turnaround .
- Retention and selling pressure: Three annual RS vest tranches (16,985 shares each) from 2025–2027 and a PSU vest in early 2027 (subject to performance) create predictable windows for potential Form 4 activity and tax-withholding share sales; hedging/pledging bans mitigate misalignment risk .
- Governance quality: Independent Chairman, CEO not on key oversight committees, double-trigger CIC equity, and robust clawbacks/ownership guidelines reduce governance risk even with CEO-director dual role .
- Downside risks: Weak 2024 TSR (0th percentile) and large net loss underscore execution risk tied to Omni integration and operational stabilization; management continuity and incentive calibration will be critical to rebuilding financial performance and equity value .