Adam Phillips
About Adam Phillips
Adam D. Phillips, age 47, is Executive Vice President and Chief Operating Officer of Marten Transport (MRTN). He became COO in March 2023 and was appointed EVP & COO on December 13, 2023, after leading Western operations and MRTN de Mexico and previously serving in regional operations roles; earlier, he held operational/management roles at Knight Transportation from 2001–2008 . Company performance during his tenure as COO saw operating revenue fall to $963.7M in 2024 (−14.8% YoY) and net income decline to $26.9M (−61.7% YoY), while cumulative TSR (from a $100 base at 12/31/2019) was $130.22 at 12/31/2024 vs $172.64 at 12/31/2023; peer group TSR was $208.70 at 12/31/2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Marten Transport | EVP & Chief Operating Officer | Dec 2023–Present | Executive leadership of company operations |
| Marten Transport | Chief Operating Officer | Mar 2023–Dec 2023 | Operational oversight across business segments |
| Marten Transport | President, Western Operations & MRTN de Mexico | Aug 2019–Mar 2023 | Led Western U.S. operations and U.S.–Mexico service |
| Marten Transport | VP, Regional & Mexico Operations | Jan 2014–Aug 2019 | Managed regional and cross-border operations |
| Marten Transport | Sr. Director, Regional Operations | Apr 2010–Jan 2014 | Regional operations leadership |
| Marten Transport | Director, Regional Operations | Jan 2008–Apr 2010 | Regional operations management |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Knight Transportation | Operational and management capacities | 2001–2008 | Operations and management experience at a major TL carrier |
Fixed Compensation
Base salary rates (annualized) and changes:
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary Rate ($) | $310,000 (effective Dec 13, 2023 with EVP & COO appointment) | $294,500 (temporary 5% reduction effective Sep 9, 2024) |
Salary paid and cash bonuses (reported):
| Metric | 2023 | 2024 |
|---|---|---|
| Salary Paid ($) | $288,860 | $317,154 (27 pay periods in 2024) |
| Annual Cash Bonus ($) | $0 (plan did not trigger) | $0 (plan did not trigger) |
Notes:
- Temporary base salary reductions in September 2024 were 5% for Adam Phillips (and 7.5% for certain other NEOs) to mitigate freight market recession impacts; reductions did not affect other compensation items .
Performance Compensation
Annual cash incentive plan (Second Amended and Restated Executive Officer Performance Incentive Plan):
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Net Income YoY vs Goal (>=105%) | N/A (pool-based) | 105% of prior-year NI; pool 5–100% of aggregate base | 2023: −36.2%; 2024: −61.7% | 2023: $0; 2024: $0 | Cash (if triggered) |
Performance unit awards (PSUs) under 2015 Equity Incentive Plan:
| Grant Year | Units Granted | Grant Date | Grant Date Fair Value ($) | Metric/Formula | 2024 Vesting | Notes |
|---|---|---|---|---|---|---|
| 2024 | 7,715 | May 7, 2024 | $135,321 | Vesting % = YoY net income increase + 10 percentage points | 1,872 shares vested (service 10% component only) | Paid in shares upon vesting |
| 2023 | N/A (units not disclosed) | N/A | $61,470 stock awards value | Same formula | N/A | Aggregate 2023 grants totaled 57,044 units across NEOs |
Option awards and exercises:
| Grant | Shares | Exercise Price | Vesting | Expiration | 2024 Activity |
|---|---|---|---|---|---|
| Aug 14, 2018 | 4,500 (exercisable) | $15.167 | 20% annually over 5 years | Aug 14, 2025 | Exercised 4,500; Value realized $33,634 |
| May 4, 2021 | 1,800 (exercisable), 1,200 (unexercisable) | $17.360 | 20% annually over 5 years | May 4, 2028 | — |
| Dec 15, 2021 | 1,800 (exercisable), 1,200 (unexercisable) | $16.930 | 20% annually over 5 years | Dec 15, 2028 | — |
Equity Ownership & Alignment
As of February 14, 2025:
| Ownership Detail | Count | Notes |
|---|---|---|
| Beneficial Ownership (Total Shares) | 10,762 (<1% of O/S) | Includes: |
| — Shares Owned Directly | 790 | |
| — Options Currently Exercisable | 8,100 | |
| — Shares Distributed (PSU vesting after Feb 14, 2025) | 1,872 | PSU service vesting paid March 2025 |
| Unvested PSUs (12/31/2024) | 10,768 units; Market value $168,088 (at $15.61) | |
| Options In-the-Money Value (12/31/2024) | $0 | All outstanding options were underwater vs $15.61 price |
| Hedging/Pledging | Hedging and short-term/speculative trading prohibited; no pledging disclosure | Company-wide hedging policy adopted in 2014 |
Stock ownership guidelines: Not disclosed in the proxy or 10-K sections reviewed.
Employment Terms
| Term | Detail |
|---|---|
| Employment Agreement | Employed at will; no employment agreement |
| Change-in-Control Severance | Double-trigger; lump sum of 100% base salary + one times highest bonus in last 3 years; welfare benefits 12 months |
| Phillips – CIC Quantification (12/31/2024) | Base salary $310,000; highest bonus $191,341; PSU acceleration value $168,088; welfare benefits $14,252; Total $683,681 |
| Equity Treatment at CIC | Options may become immediately exercisable if outstanding ≥6 months; PSUs vest in full upon CIC + qualifying termination within 24 months; committee discretion to cash out awards |
| Clawback | Nasdaq-compliant clawback policy effective Oct 2, 2023 covering incentive-based compensation |
| Non-Compete/Cause | “Cause” includes material breach of confidentiality or non-compete agreements |
| Excise Tax Gross-Up | Eliminated in March 2011; no gross-ups under current CIC agreements |
Compensation Structure Analysis
- Equity-heavy pay: In 2024, Phillips’ pay comprised salary $317,154 and stock awards $135,321, with no annual cash bonus due to performance shortfall; company-wide performance-based pay accounted for ~29.6% of NEO totals, all long-term equity in 2024 .
- Shift to PSUs: Since 2015, executives primarily receive performance unit awards rather than options; committees have not issued option awards to executives since 2015, favoring PSUs tied to net income growth plus a service component .
- Cost discipline signal: Temporary base salary reductions effective Sep 2024 (Phillips −5%) amid freight recession; reductions did not alter other compensation components .
- Say-on-pay support: 98% approval at 2024 annual meeting; company conducts annual say-on-pay going forward .
Compensation Peer Group (Benchmarking)
MRTN benchmarks exec pay against truckload peers with ~$0.8–$7B revenue: Covenant Logistics, Heartland Express, Knight-Swift, P.A.M. Transportation, and Werner Enterprises .
Performance & Track Record
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Operating Revenue ($M) | — | — | — | 1,131.5 | 963.7 |
| Net Income ($M) | 69.5 | 85.4 | 110.4 | 70.4 | 26.9 |
| % Change in Net Income | — | +22.9% | +29.2% | −36.2% | −61.7% |
| Company TSR (Value of $100) | $128.47 | $137.88 | $160.90 | $172.64 | $130.22 |
| Peer Group TSR (Value of $100) | $131.56 | $213.00 | $174.40 | $230.65 | $208.70 |
Note: EBITDA metrics are not disclosed in the cited sections; management identifies percentage change in net income as the sole company-selected performance metric used in pay-versus-performance disclosure .
Governance & Committees (context for compensation oversight)
- Compensation Committee: Kathleen P. Iverson (Chair), Thomas J. Winkel, Jerry M. Bauer, Larry B. Hagness, Patricia L. Jones; independent directors; met 5 times in 2024 .
- Consultant: Grant Thornton conducted benchmarking studies in 2022, 2020 and 2017; approach continues to guide decisions .
Equity Plan Evolution & Overhang (context)
- 2015 Equity Incentive Plan terminates May 12, 2025; Board proposed 2025 Equity Incentive Plan (800,000 shares) for stockholder approval, with strong governance features (no re-pricing, clawback, director comp limits) .
Investment Implications
- Alignment and dilution: Phillips’ equity mix is primarily PSUs tied to net income growth with a 10% service component; with 10,768 unvested units at year-end 2024 (MV $168,088), vesting creates gradual share issuance, while the proposed 2025 plan adds controlled capacity for future grants .
- Selling pressure: Underwater options at year-end 2024 imply limited near-term exercise-driven selling; 2024 PSU service vesting (1,872 shares paid in March 2025) adds modest supply; recent salary cuts reduce cash comp but do not affect equity vesting .
- Retention risk: Double-trigger CIC severance and equity acceleration provide protection; at-will employment and absence of long-term guaranteed cash bonuses increase pay-for-performance sensitivity; hedging prohibition and clawback enhance alignment and deterrence against misreporting .
- Execution focus: Operations under Phillips’ tenure faced a freight recession with margins compressed (consolidated OR 96.6% in 2024 vs 92.0% in 2023); pay structures emphasize net income growth, suggesting upside leverage if cycle turns, but zero annual bonus in 2023–2024 highlights sensitivity to profitability .
Citations:
- Roles/biography: **[799167_0001437749-25-005570_mrtn20241231_10k.htm:25]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:9]**
- Compensation tables and grants: **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:30]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:32]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:24]** **[799167_0001437749-24-029002_mrtn20240906_8k.htm:1]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:21]**
- Ownership, options, vesting: **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:16]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:35]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:39]**
- Performance metrics and TSR: **[799167_0001437749-25-005570_mrtn20241231_10k.htm:27]** **[799167_0001437749-25-005570_mrtn20241231_10k.htm:30]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:41]**
- Governance/committees and policies: **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:12]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:19]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:8]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:33]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:44]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:55]**
- Change-in-control terms/quantification: **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:27]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:28]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:37]** **[799167_0001437749-25-007804_mrtn20250305_def14a.htm:38]**