Gary Knight

About Gary Knight

Gary Knight, age 73, is Vice Chairman of Knight-Swift Transportation Holdings Inc. and has served on the Board since 2004; he was Knight’s President from 1993–2004 and previously an EVP at Swift from 1975–1990, bringing deep industry expertise and company-specific leadership continuity . He is a non-independent director (first cousin of Executive Chairman Kevin Knight) and serves on the Board’s Executive Committee, with a tenure noted at 35 years on the Board’s skills matrix . Company performance benchmarks tied to his incentive design include multi-year TSR, revenue growth, and returns; notably, for the 2021 PRSUs (performance period 2022–2024), KNX’s TSR was -1.88% (below 40th percentile), while Return on Net Tangible Assets and CAGR Total Revenue Growth each ranked second among peers, leading to 112.5% vesting on the relative PRSUs and 0% on the target PRSUs . 2024 company scale/context: total revenue $7.4B, revenue excluding fuel surcharge $6.6B, adjusted operating ratio 94.7%, free cash flow $234M .

Past Roles

External Roles

Board Governance

• Status and independence: Non-independent director; Vice Chairman; Executive Committee member .
• Board leadership: Chair and CEO roles separated; robust Lead Independent Director role (David Vander Ploeg) with defined oversight responsibilities and regular executive sessions (not less than annually) .
• Committee structure: Audit, Compensation, Nominating & Corporate Governance, and Finance committees are fully independent; Executive Committee includes Kevin Knight (Chair), Gary Knight, Kathryn Munro, and David Vander Ploeg; Executive Committee held no meetings in 2024 .
• Director compensation: Employee directors (e.g., Vice Chairman) do not receive director fees; non-employee directors receive $220,000 annual retainer (min $130,000 in equity) plus committee retainers .

Fixed Compensation

Performance Compensation

Annual Cash Bonus (Design and 2024 outcome)

2025 target bonus potentials: Gary Knight 75% of base salary (same as 2024) .

Long-Term Incentives (PRSUs/RSUs)

Equity Ownership & Alignment

Outstanding Equity Awards at Fiscal Year-End (12/31/2024)

Note: Market values above use $53.04 per share closing price on 12/31/2024 .

Vested in 2024 (supply considerations)

Employment Terms

• Change-of-control and termination: PRSUs vest upon Change of Control coupled with qualifying termination (termination for convenience or for Good Reason), at performance level through year-end; RSUs/PRSUs vest upon death or disability; no vesting for PRSUs if performance period has not started . The Omnibus Plan requires double-trigger vesting upon change of control .
• Estimated accelerated equity value (12/31/2024): CoC with qualifying termination—PRSUs $905,234; death/disability—RSUs $881,472 and PRSUs $905,234 (total $1,786,706) .
• Clawback: Amended and Restated Clawback Policy requires reimbursement of incentive-based compensation upon material financial restatement; three-year look-back; applies to NEOs and other designated officers .
• Nonqualified deferred compensation: No executive or registrant contributions reported for Gary Knight in 2024; no balances disclosed for him .
• Securities Trading Policy: Company STP filed as exhibit to 2024 10-K; designed for insider trading compliance .

Compensation Structure Analysis

• Mix and risk: Conservative base salary with meaningful at-risk pay in annual bonus and multi-year PRSUs/RSUs; long-term incentives comprise 60% performance-based PRSUs and 40% time-based RSUs; three-year performance/vesting cycles foster retention and long-term alignment .
• Metric evolution: Inclusion of consolidated revenue CAGR and Adjusted EPS CAGR in PRSUs emphasizes diversification and profit growth; relative peer-rank metrics (RONTA, revenue growth) and TSR modifier tighten pay-for-performance alignment .
• 2024 outcomes: Zero vesting on 2021 target PRSUs (EPS CAGRs and revenue grids failed), but relative PRSUs paid 112.5%—payout differentiation evidences formulaic linkage to disclosed performance .
• ESG modifier: Annual cash bonus subject to +/-10% ESG rating index adjustment (MSCI, Sustainalytics, CDP, EcoVadis, S&P Global), modest but directionally important signal for governance-sensitive investors .

Compensation Peer Group (Benchmarking)

Positioning: KNX ~53rd percentile in total revenue and ~67th percentile in market cap vs benchmarking peers; executive total direct compensation at competitive median .

Equity Ownership & Pledging Risk Indicators

• Pledging grandfathered (reduced by 50% in 2020); 1.1M shares pledged by Gary Knight; periodic risk review by Nominating & Corporate Governance Committee; no hardship exemption .
• Ownership guideline compliance: KNX reports all NEOs in compliance; Gary’s guideline 3x salary .
• Hedging prohibited for Designated Persons .

Say-on-Pay & Shareholder Feedback

• Board recommended “FOR” the 2025 advisory vote on NEO compensation; percentages not disclosed .

Expertise & Qualifications

• Deep industry operations and executive experience across truckload and diversified freight; long tenure on Board with Vice Chairman role; familial tie to Executive Chairman acknowledged and considered in independence determinations .

Performance & Track Record

• 2024 company highlights: revenue scale ($7.4B total), adjusted operating ratio 94.7%, free cash flow $234M .
• 2022–2024 PRSU performance: Relative PRSUs paid 112.5% on strong peer ranks (RONTA and revenue growth), while target PRSUs paid 0% amid negative Adjusted EPS CAGR and sub-40th percentile TSR .

Compensation Committee Analysis

• Compensation Committee: Independent; chaired by Roberta Roberts Shank; uses independent consultant Pearl Meyer; committee met five times in 2024; no conflicts noted .
• Design principles: Median targeting, significant performance-based equity, caps to discourage excessive risk, double-trigger CoC vesting, robust ownership guidelines, no tax gross-ups, no option repricing .

Equity Award Detail — Grants of Plan-Based Awards (2024)

Vesting schedules: RSUs 33% on 1/31/2026, 33% on 1/31/2027, 34% on 1/31/2028; PRSUs performance period ends 12/31/2027, vest 1/31/2028 .

Employment & Contracts

• Contract term, non-compete/non-solicit, garden leave, and severance multiples are not disclosed in the proxy beyond equity acceleration mechanics and double-trigger vesting requirement in Omnibus Plan; skip if not disclosed .

Investment Implications

• Alignment with long-term value creation: Significant personal share ownership (1.7% of outstanding) and compliance with ownership guidelines align interests; performance-heavy PRSUs tied to EPS CAGR, revenue CAGR, RONTA, and peer-relative outcomes improve pay-for-performance integrity .
• Pledging risk: 1.1M pledged shares represent a potential margin-call vector during volatility; KNX’s policy grandfathered and reduced pledges, with ongoing oversight—still a watch item for governance-sensitive investors and potential trading pressure in stress scenarios .
• Vesting supply and timing: RSU tranches vest on 1/31/2026, 1/31/2027, 1/31/2028; PRSUs from the 2024 grant vest 1/31/2028—these dates may create periodic supply and discretionary sales; 2024 vesting of 13,721 shares (value $787k) indicates realized equity cadence .
• Dual-role governance consideration: As a non-independent Vice Chairman and family relation to the Executive Chairman, independence optics require robust lead independent director and committee structures—which KNX has articulated; continued monitoring of Executive Committee activity and independence safeguards advisable .
• Pay trajectory: Cash pay is conservative; LTI targets for 2025 maintained with PRSU-heavy mix; ESG modifier adds incremental alignment but is small (+/-10%); lack of cash severance disclosure (beyond equity) diminishes clarity on downside protections—neutral to modestly positive alignment signal .