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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-K

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for the fiscal year December 31, 20212022.

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for the transition period from to .

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Commission file number 0-19969

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ARCBEST CORPORATION

(Exact name of registrant as specified in its charter)

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Registrant’s telephone number, including area code 479-785-6000

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Securities registered pursuant to Section 12(b) of the Act:

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Securities registered pursuant to Section 12(g) of the Act:

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None

(Title of Class)

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐☒ No ☒☐

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Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒ No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒ No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

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If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

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Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

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The aggregate market value of the Common Stock held by nonaffiliates of the registrant, based on the closing price of the shares of Common Stock on the Nasdaq Global Select Market as of June 30, 2021,2022, was $1,458,553,375.$1,689,914,269.

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The number of shares of Common Stock, $0.01 par value, outstanding as of February 25, 2022,20, 2023, was 24,597,758.24,258,338.

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DOCUMENTS INCORPORATED BY REFERENCE

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Portions of the registrant’s Definitive Proxy Statement to be filed pursuant to Regulation 14A of the Securities Exchange Act of 1934 in connection with the registrant’s Annual Stockholders’ Meeting to be held April 27, 2022,26, 2023, are incorporated by reference in Part III of this Form 10-K.10-K.

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ARCBEST CORPORATION

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FORM 10-K

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PART I

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Forward-Looking Statements

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This Annual Report on Form 10-K contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included or incorporated by reference in this Annual Report on Form 10-K, including, but not limited to, those in Item 1 (Business), Item 1A (Risk Factors), Item 3 (Legal Proceedings), and Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations), are forward-looking statements. Terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “foresee,” “intend,” “may,” “plan,” “predict,” “project,” “scheduled,” “should,” “would,” and similar expressions and the negatives of such terms are intended to identify forward-looking statements. These statements are based on management’s beliefs, assumptions, and expectations based on currently available information, are not guarantees of future performance, and involve certain risks and uncertainties (some of which are beyond our control). Although we believe that the expectations reflected in these forward-looking statements are reasonable as and when made, we cannot provide assurance that our expectations will prove to be correct. Actual outcomes and results could materially differ from what is expressed, implied, or forecasted in these statements due to a number of factors, including, but not limited to:

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For additional information regarding known material factors that could cause our actual results to differ from those expressed in these forward-looking statements, please see Item 1A (Risk Factors). All forward-looking statements included or incorporated

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what. We support our employees by providing an exceptional workplace where people with diverse experiences, needs and perspectives can grow and make a lasting impact.

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We carry out our vision by exemplifying our corporate values:

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Strategy

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Our customer-led strategy is to produce long-term value with our creative problem solvers by growing informed, trusted, and innovative relationships with shippers and capacity providers and delivering a best-in-class experience efficiently through their desired channels.

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We work to build long-term value for our customers, employees and shareholders by:

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Business Description

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ArcBest is ana growth-oriented, digitally-enabled integrated logistics company that delivers reliable, innovative solutions for a variety ofvarious supply chain challenges leveraging our technology and full suite of shipping and logistics solutions to meet— meeting our customers’ critical supply chain needs. Our offerings includeneeds and helping keep the global supply chain moving. We offer LTL freight transportation through the ABF Freight network; truckload freight transportation, including brokerage services offered through our newly acquired operations of MoLo; specialized transportation logistics, and supply chain managementpremium logistics services, including ground expedite solutions through the Panther Premium Logistics brand and household goods moving services under the U-Pack brand; managed transportation solutions; and commercial vehicle maintenance and repair fromthrough FleetNet. ArcBest Technologies provides leading-edge technologies that help support our customers and optimize supply chains. From Fortune 100 companies to small businesses, our customers trust ArcBest for their transportation and logistics needs.

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With a relentless focus on customer needs and unique access to assured transportation capacity, which includes more than 40,000 owned and operated assets, we create solutions for even the most complex and demanding supply chains. We strive to help customers solve their logistics challenges by efficiently providing a best-in-class experience with easy access to our integrated solutions.  

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For the year ended December 31, 2021,2022, no single customer accounted for more than 2% of our consolidated revenues, and the 10ten largest customers, on a combined basis, accounted for approximately 9%12% of our consolidated revenues. The Company was incorporated in Delaware in 1966 and is headquartered in Fort Smith, Arkansas.

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Asset-Based Segment

Our Asset-Based segment provides LTL services through ABF Freight’s motor carrier operations. Asset-Based revenues accounted for approximately 62%55% of our total revenues before other revenues and intercompany eliminations in 2021.2022. For the year ended December 31, 2021,2022, no single customer accounted for more than 1%3% of revenues in the Asset-Based segment, and the segment’s 10ten largest customers, on a combined basis, accounted for approximately 4%12% of its revenues. Note N to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K contains additional segment financial information, including revenues and operating income for the years ended December 31, 2022, 2021, 2020, and 2019.2020.

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Our Asset-Based carrier, ABF Freight, has been in continuous service since 1923. ABF Freight System, Inc. is the successor to Arkansas Motor Freight, a business formed in 1935 whichthat was the successor to a local transfer and storage carrier that was established in 1923. ABF Freight expanded operations through several strategic acquisitions and organic growth and is now one of theNorth America’s largest LTL motor carriers, in North America, providing direct service to more than 98% of U.S. cities havingwith a population of 30,000 or more. ABF Freight offers interstate and intrastate serviceservices to approximately 51,000 communities through 239 service centers in all 50 states, Canada, and Puerto Rico.Rico through 239 service centers. ABF Freight also provides motor carrier freight transportation services to customers in Mexico through arrangements with trucking companies in that country.

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Our Asset-Based segment offers transportation of general commodities through standard, time-critical, and guaranteed LTL services. General commodities include all freight except hazardous waste, dangerous explosives, commodities of exceptionally high value, commodities in bulk, and those requiring special equipment. Shipments of general commodities differ from shipments of bulk raw materials, which are commonly transported by railroad, truckload tank car, pipeline, and water carrier. General commodities transported by our Asset-Based operations include, among other things, food, textiles, apparel, furniture, appliances, chemicals, nonbulknon-bulk petroleum products, rubber, plastics, metal and metal products, wood, glass, automotive parts, machinery, and miscellaneous manufactured products.

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The LTL transportation industry, which requires networks of local pickup and delivery service centers combined with larger distribution facilities, is significantly more infrastructure-intensive than truckload operations and, as such, has higher barriers to entry. Costs associated with an expansive LTL network, including investments in or costs associated with real estate and labor costs related to local pickup, delivery, and cross-docking of shipments, are to a large extentprimarily fixed in nature unless service levels are significantly changed.

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ArcBest Technologies, Inc., our wholly owned subsidiary which is focused on the advancement ofadvancing supply chain execution technologies, began a pilot test program (the “pilot”) in early 2019 to improve freight handlingfreight-handling at ABF Freight. The pilot utilizes patented handling equipment, patented software, and a patented process to load and unload trailers more rapidly and safely, with full freight loads pulled out of the trailer onto the facility floor and accessible from multiple points. The pilot is in the early stagesoperates in a limited number of locations. ABF Freight has leasedlocations, including a facility in Indiana, a new distribution center in Missouri, andKansas City, Missouri. ABF Freight signed a lease for a new pilot location in Salt Lake City, Utah, which is set to open in 2022.early 2023. The pilot providesallows ABF Freight an opportunity to evaluate the potential for improving safety and working conditions for employees and for providing a better experience for customers. Potential benefits include improved transit performance, reduced cargo claims, reduced injuries and workers’ compensation claims, and faster employee training. While we believe the pilot has the potential to provide safer and improved freight-handling,freight handling, a number of factors will be involved in determining proof of concept, and there can be no assurances that pilot testing will be successful or expand beyond current testing locations.successful.

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Labor costs, which amounted to 46.6%43.0% of Asset-Based revenues for 2021,2022, are the largest component of the segment’s operating expenses. As of December 2021,2022, approximately 82% of the Asset-Based segment’s employees were covered under a collective bargaining agreement, the ABF National Master Freight Agreement (the “2018 ABF NMFA”), with the International Brotherhood of Teamsters (the “IBT”), which was ratified on May 10, 2018, by a majority of ABF Freight’s IBT member employees who voted. Following ratification of the supplements to the collective bargaining agreement, the 2018 ABF NMFA was implemented on July 29, 2018, with certain components effective retroactiveretroactively to April 1, 2018, and will remain in effect through June 30, 2023. The major economic provisions of the 2018 ABF NMFA include the restoration of one week of vacation that was previously reduced in the prior collective bargaining agreement, with the new vacation eligibility schedule being the same as the applicable 2008 to 2013 supplemental agreements; wage rate increases in each year of the contract, beginning July 1, 2018; ratification bonuses for qualifying employees; profit-sharing bonuses upon the Asset-Based segment’s achievement of certain annual operating ratios calculated in accordance with U.S. generally accepted accounting principles (“GAAP”) for any full calendar year under the contract; and changes to purchased transportation provisions with certain protections for road drivers as specified in the contract. The 2018 ABF NMFA and the related

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the related supplemental agreements provide for contributions to multiemployer pension plans frozen at the current rates for each fund, continuation of existing health coverage, and annual contribution rate increases to multiemployer health and welfare plans maintained for the benefit of ABF Freight’s employees who are members of the IBT. Under the 2018 ABF NMFA, the contractual wage and benefits costs, including the ratification bonuses and vacation restoration, are estimated to increase approximately 2.0% on a compounded annual basis through the end of the agreement. Profit-sharing bonuses based on the Asset-Based segment’s annual operating ratios for any full calendar year under the contract represent an additional increase in costs under the 2018 ABF NMFA.The profit-sharing bonus under the 2018 ABF NMFA was earned for the years ended December 31, 2022, 2021, 2020, and 20192020 upon the Asset-Based segment achieving an annual GAAP operating ratio of 87.3% for 2022, 89.9% for 2021, and 95.3% for 2020, and 95.2% for 2019. As a result of the operating ratio achieved in 2021,2020. ABF Freight paid the profit-sharing bonus to qualified union-represented employees at the 3% maximum amount provided in the 2018 ABF NMFA.NMFA as a result of the operating ratios achieved in 2022 and 2021.  

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ABF Freight contributes to multiemployer pension and health and welfare plans, which have been established pursuant to the Taft-HartleyLabor Management Relations Act of 1947 (the “Taft-Hartley Act”), to provide benefits for its contractual employees. Amendments to the Employee Retirement Income Security Act of 1974 (“ERISA”), pursuant to the Multiemployer Pension Plan Amendments Act of 1980 (the “MPPA Act”), substantially expanded the potential liabilities of employers who participate in multiemployer pension plans. Under ERISA, as amended by the MPPA Act, an employer who contributes to a multiemployer pension plan and the members of such employer’s controlled group are jointly and severally liable for their share of the plan’s unfunded vested benefits in the event the employer ceases to have an obligation to contribute to the plan or substantially reduces its contributions to the plan (i.e., in the event of a complete or partial withdrawal from the multiemployer plans). ABF Freight’s funding obligations to the multiemployer pension plans to which it contributes are intended to satisfy the requirements imposed by the Pension Protection Act of 2006 (the “PPA”), which was permanently extended by the Multiemployer Pension Reform Act of 2014 (the “Reform Act”) included in the Consolidated and Further Continuing Appropriations Act of 2015.2015. Through the term of its current collective bargaining agreement, ABF Freight’s multiemployer pension plan contribution obligations generally will be satisfied by making the specified contributions when due. However, we cannot determine with any certainty the contributions that will be required under future collective bargaining agreements for ABF Freight’s contractual employees. See Note J to the consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more specific disclosures regarding the multiemployer pension plans to which ABF Freight contributes.contributes, and see the discussion of recent legislation impacting  funding for multiemployer pension plans within “Asset-Based Operations” in the “Results of Operations” section of Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) of this Annual Report on Form 10-K.

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ABF Freight operates in a highly competitive industry which consists predominantlycomprised primarily of nonunion motor carriers. Nonunion competitors have a lower fringe benefit cost structure and less stringent labor work rules, and certain carriers also have lower wage rates for their freight-handling and driving personnel. Wage and benefit concessions granted to certain union competitors also allow for a lower cost structure. ABF Freight has continued to address with the IBT the effect of the wage and benefit cost structure on its operating results. Lower cost increases throughout the 2018 ABF NMFA contract period and increased flexibility in labor work rules are importantessential factors in bringing ABF Freight’s labor cost structure closer in line with that of its competitors; however, ABF Freight continues to pay some of the highest benefit contribution rates in the industry. These rates include contributions toABF Freight’s multiemployer plans,plan contributions, a portion of which are used to fund benefits for individuals who were never employed by ABF Freight. Information provided by a large multiemployer pension plan to which

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ABF Freight contributes indicates that approximately 50%will commence negotiations with the IBT in late first quarter or early second quarter 2023 for its new collective bargaining agreement for the period subsequent to June 30, 2023. The negotiation of terms of the plan’scollective bargaining agreement is a very complex process, and there can be no assurances regarding the terms of the new agreement and the related impact on ABF Freight’s operations and its wage and benefit paymentscost structure for the new period. The risks related to negotiations for the new collective bargaining agreement are made to retireesfurther discussed in Part I, Item 1A (Risk Factors) of companies that are no longer contributing employers to that plan.this Annual Report on Form 10-K.

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Asset-Light Operations

The ArcBest and FleetNet reportable segments, combined, represent our Asset-Light operations. Our Asset-Light operations are a key component of our strategy to offer customers a single source of integrated logistics solutions, designed to satisfy the complex supply chain and unique shipping requirements customers encounter. Through unique methods and processes, including technology solutions and the use of third-party service providers, our Asset-Light operations provide various logistics and maintenance services without significant investment in revenue equipment or real estate.

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For the year ended December 31, 2021,2022, the combined revenues of our Asset-Light operations accounted forhave increased to approximately 38% of our total revenues before other revenues and intercompany eliminations. For the year ended December 31, 2021, no single customer accounted for more than 7% of the ArcBest segment’s revenues, and the segment’s 10 largest customers, on a combined basis, accounted for approximately 32% of its revenues. Following our acquisition of MoLo, our Asset-Light operations accounted for approximately 44%45% of our total revenues before other revenues and intercompany eliminations, in the fourth quarter ofversus 38% for 2021, indicating strong momentum in our efforts to align our revenue mix with that of our customers’ logistics spend.spend, accelerated by the acquisition of MoLo in November 2021. For the year ended December 31, 2022, no single customer accounted for more than 4% of the ArcBest segment’s revenues, and the segment’s ten largest customers, on a combined basis, accounted for approximately 20% of its revenues. Note N to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K contains additional segment financial information, including revenues and operating income for the years ended December 31, 2022, 2021, 2020, and 2019.2020.

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International

Our Internationalinternational shipping and logistics services provide international ocean and air shipping solutions by partnering with ocean shipping lines and air freight carriers worldwide, as well as cross-border shipping and ground transportation to and from ports. As a non-vessel operating common carrier, we provide less-than-container load and full-containerfull container load service, offering ocean transport to approximately 90% of the total ocean international market to and from the United States. We also offer warehousing and distribution services to and from major global ports across the globe to streamline our customers’ ocean shipping processes.

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Managed Transportation

Through our managed transportation solutions, we provide complete freight transportation management services which enable customers to continually optimize their supply chains. ArcBest seeks to offer value through identifying specific challenges relating to customers’ supply chain needs and providing customized solutions utilizing technology, both internally to manage its business processes and externally to provide shipment and inventory visibility to its customers. Additional value is created for customers through seamless access to the ABF Freight network, the Panther Premium Logistics fleet, and other ArcBest capacity sources, offering strategic supply chain solutions with unique access to assured capacity.

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of shipments, verification of chain of custody procedures, and advanced security have significant operational advantages and create enhanced customer value.

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FleetNet competes in the commercial vehicle maintenance and repair industry in two major sectors: emergency roadside and preventive maintenance. FleetNet competes directly against other third-party service providers, automotive fleet managers, leasing companies, and companies handling repairs in-house via individual service providers. Market competition for FleetNet is based primarily on maintenance solutions service offerings. In partnership with best-in-class third-party vendors, FleetNet offers flexible, customized solutions and utilizes technology to provide valuable information and data to minimize fleet downtime, reduce maintenance events, and lower total maintenance costs for its customers.

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permits, some of which are difficult to obtain. The trucking industry faces rising costs of compliance with government regulations on safety, equipment design and maintenance, driver utilization, and fuel economy, as well as increasing costs in certain non-industry specific areas, which are not industry-specific, including health care and retirement benefits. Higher compliance costs will continue to impair the competitiveness of smaller carriers in the logistics market, which may lead to tighter capacity or consolidation within certain sectors. In addition, disruptions from unexpected events such as natural disasters and the COVID-19 pandemic have resulted in further utilization of expedited shipping and premium logistics services and have caused companies to focus on risk management within their supply chains.

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Directly addressing our customers’ supply chain challenges is a natural extension of our mission. We work to build efficiencies and sustainable best practices within our own business and the supply chain as a whole. We have made additional technology investments to improve both customer experience and carrier capacity experience while continuing to optimize costs in our operating segments:costs. Some examples of these investments include:

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Typically, freight transportation customers communicate their freight needs, on a shipment-by-shipment basis, by means ofusing telephone, email, web, mobile applications, orthrough electronic data interchange (“EDI”) and, more recently,or by API. In the ArcBest segment, the information about each shipment is entered into a proprietaryan operating system whichthat facilitates the selection of a contracted carrier or carriers based on the carrier’s service capability, equipment availability, freight rates, and other relevant factors. Once the carrier is selected, the cost for the transportation has been agreed upon, and the carrier has committed to provideproviding the transportation, we are in contact with the carrier through numerous means of communication (i.e., mobile apps, satellite tracking, electronic logging device (“ELD”), and other communication units on the vehicles) to continually update the position of equipment in order to better meet customers’ requirements to track the status of the shipment from origin to delivery. The various tracking methods automatically update our fully integrated internal software and provide customers with real-time electronic updates.

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We make information readily accessible to our customers through various electronic pricing, billing, and tracking services, including mobile-responsive websites whichthat allow customers to access information about their shipments, request shipment pickup, and utilize a variety ofvarious other digital tools. Online functions tailored to the services requested by customers include bill of lading generation, pickup planning, customer-specific price quotations, proactive tracking, customized e-mailemail notification, logistics reporting, dynamic rerouting, and Extensible Markup Language (XML) connectivity.other connectivity tools. This technology allows customers to incorporate data from our systems directly into their own website, transportation management systems, or other information systems using EDI standards as well asand secure API. As a result, our customers can provide shipping information and support directly to their own customers.

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ArcBest has also launched an innovation acceleratorInnovation Ambassador Program to encourage new, transformative ideas. This acceleratorprogram includes a team of employees from across the organization who work closely with executive leadership to identify opportunities for disruptive innovation within our company and to evaluate potential external innovation partners. In 2020,Additionally, during 2022, ArcBest was a memberTechnologies sponsored its third annual Imagine 2022 competition, which allows teams to collaborate and

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work on innovative ideas related to both technology and business systems innovation. The 2022 competition asked teams of employees across the Blockchain in Transport Alliance, which is a consortium of more than 250 freight transportation companies workingorganization to developpresent ideas and set standards forsolutions focused on reducing our industry’s impact on the use of blockchain technology within the logistics and transportation industry.environment.

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In May 2021, ArcBest announced a $1 million investment in the Peak Innovation Center, a state-of-the-art career and technical education center that will beis available to approximately 43,000 students from 22 regional school districts. The Peak Innovation Center with an anticipated openingopened in March 2022 is expected to address needs of the Fort Smith, Arkansas community to createand has created a pipeline of local talent to fill existing jobs and support further economic growth.growth in the Fort Smith, Arkansas community.

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Insurance

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Generally, claims exposure in the freight transportation and logistics industry consists of workers’ compensation, third-party casualty liability, and cargo loss and damage. We are effectively self-insured for $1.0 million of each workers’ compensation loss. For each third-party casualtygeneral liability loss, we are generally self-insured for $1.0 million. We are also self-insured for each cargo loss up to a $0.3 million deductible for our Asset-Based segment and a $0.1 million deductible for our ArcBest segment.segment, with a $2.0 million retention limit for each auto accident or loss. We maintain insurance that we believe is adequate to cover losses in excess of such self-insured amounts or deductibles. However, we cannot provide assurance that our insurance coverage will provide adequate protection under all circumstances or against all potential losses. We have experienced situations where excess insurance carriers have become insolvent. We pay assessments and fees to state guaranty funds in states where we have workers’

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Based segment, for model years 2021-2027 and also instituting fuel efficiency improvement technology requirements for trailer model years 2018-2027. In September 2020, the U.S. Court of Appeals for the District of Columbia stayed the portion of the EPA/NHTSA Phase 2 Final Rule regarding the trailer regulations, and the review of the Final Rule has an indefinite date of final ruling.

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In September 2019, the state of California signed legislation which directs the California Air Resources Board (the “CARB”) and other state agencies to develop and implement a comprehensive inspection and maintenance program for heavy-duty vehicles. A number of states have individually enacted, and California and certain other states may continue to enact, legislation relating to engine emissions, trailer regulations, fuel economy, and/or fuel formulation, such as regulations enacted by the CARB. In December 2019,2021, the CARB announced it will be suspending, until at least January 2022, its previously approved plans to enforce certain provisions of the EPA/NHTSANHSTA Phase 2 Final Rule that would regulate glider kits and trailers. In the event the EPA does not enforce the trailer regulations of EPA/NHTSA Phase 2, certain other states may also individually enact legislationtrailers with implementation to enforce the regulations.be phased in starting in January 2023. At the present time, management believes that these regulations maywill likely not result in significant net additional overall costs should the technologies developed for tractors, as required in the EPA/NHTSA Phase 2 rulemaking, prove to be as cost-effective as forecasted by the EPA and the NHTSA.

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In November 2018, the EPA launched the “Cleaner Trucks Initiative” (the “CTI”) which includes plans for future rulemaking to reduce nitrogen oxide emissions. In January 2020, the EPA published an Advanced Notice of Proposed Rulemaking to solicit pre-proposal comments on the CTI. One planned feature of the initiative is to coordinate emissions standards nationwide in an effort to make compliance easier for the industry by preventing a further patchwork of state and local emissions regulations. In August 2021, the EPA announced the “Clean Truck Plan,” a series of rulemakings over the next three years, the first of which is expected to be finalized by Decemberwas proposed in March 2022, to set new emissions standards to reduce nitrogen oxide emissions from heavy-duty vehicles beginning with model year 2027. The passage of the Inflation Reduction Act of 2022 in August 2022 also seeks to update GHG standards. The EPA announced it will consider more stringent greenhouse gas standards for heavy-duty vehicles for model years 2027-2029.

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It is anticipated that the resolution of our environmental matters could take place over several years. Our reserves for environmental compliance matters and cleanup costs are estimated based on management’s experience with similar environmental matters and on testing performed at certain sites.

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Other Government Regulations

We operate in the United States, and from the United States for international transportation, pursuant to federal operating authority granted by the U.S. Department of Transportation (the “DOT”) and the U.S. Federal Maritime Commission. Our operations are subject to cargo security and transportation regulations issued by the Transportation Security Administration and regulations issued by the U.S. Department of Homeland Security.

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We operate under the Occupational Safety and Health Act of 1970 (the “OSH Act”). Under the OSH Act, ArcBest has a responsibility to provide employees a safe workplace. This includes, but is not limited to:

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Our Asset-Based operations and our ArcBest segment’s network of third-party contract carriers must comply with industry regulations, including the ELD mandate of the Federal Motor Carrier Safety Administration (the “FMCSA”) for interstate commercial trucks and hours-of-service,hours of service, safety and fitness, and other regulations of the DOT, including requirements related to drug and alcohol testing. We are subject to the hazardous materials regulations of the FMCSA for our transportation and arrangement for transportation of hazardous materials and explosives, as well as our disposal of hazardous waste.

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We provide transportation and logistics services to and from a number of international locations and are, therefore, subject to a wide variety of domestic and international laws and regulations, including export and import laws. We are also subject to compliance with the Foreign Corrupt Practices Act of 1977, as amended and hold Customs-Trade Partnership Against Terrorism status for businesses within our Asset-Based and ArcBest segments.

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We also have a succession planning program to ensure continuity in critical roles, within our organization, allowing leaders to identify and develop employees for specific career paths. We evaluate compensation to ensure it remains competitive, including the insurance and retirement benefits, and we provideoffer programs to support the four pillars of wellness for our employees – physical, financial, emotional,emotional/social, and social. Andevelopmental. We conduct an annual survey is conductedas well as pulse surveys to request employee feedback from employees to help us assess and improve engagement and implement changes to enhance our work environment.

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Attracting, retaining, and retainingupskilling qualified truck drivers is crucial to our business. To address the driver shortage that continues to impact the freight transportation industry, we have strong hiring partnerships with the IBT and the military that allowsallow us to hire potential drivers and train thempotential drivers before they leave the military service. We also haveconduct an in-house training program through our Driver Development Program and host frequent onsite hiring events at critical locations.

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Diversity, Equity, and Inclusion

We embrace and encourage diverse experienceexperiences, needs, and perspectives which, in turn, help us create an environment in whichwhere our employees want to belong,feel welcome, safe, and suchvalued. Such diversity helps us better serve our customers around the globe. We partnerpartnered with a consulting firm who specializesspecializing in the areas of diversity, equity, and inclusion (“DEI”) as we work to assess,measure and develop and measure these areas of human capital management in our organization. Our three-year DEI roadmap is divided into the following four main areas — workforce, workplace, community, and marketplace — each focusing on a different aspect of corporate diversity.

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We continue to invest in personnel to lead and execute ArcBest’s DEI strategy. We engage leaders in the organization to advance our people and community programs. In September 2022, we developed a framework to establish ArcBest’s first Employee Resource Groups (“ERGs”). ERGs are voluntary, employee-led groups that help create an open and welcoming space to foster community building for employees’ shared identities, experiences, or interest in supporting underrepresented talent.  

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In October 2022, we announced our partnership with Integrate Autism Employment Advisors (“Integrate”), a non-profit organization that collaborates with companies to identify, recruit, and retain professionals on the autism spectrum, to foster a neuro-inclusive workforce and continue attracting the best talent with unique skill sets. Our partnership with Integrate demonstrates ArcBest's commitment to advancing DEI initiatives to create a workplace where we embrace and encourage diverse experiences and perspectives. We are intentional in our efforts to attract, hire, retain, and upskill diverse and historically excluded talent. Our 2022 new hires represented a variety of backgrounds and experiences, with over 60% of them being diverse as categorized by gender, race, ethnicity, or military status.

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Our corporate Code of Conduct sets forth our general principles of business conduct and ethics. Our nonunion employees are required to participate in annual Code of Conduct training, which includesalso covers our anti-discrimination and anti-harassment policies to further educate to our employees about the importance ofprohibited behaviors that undermine diversity. In 2021, 100% of ourOur new hires completedcomplete anti-harassment training. Over 85% oftraining, and our management employees participated inare provided with DEI training in 2021.

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easier and to reduce damage. During 2021, every service center received some or all of the COVID-19 pandemic, we implemented business continuity processes focusedattachments and completed training on maintaining customer service levels while emphasizing the health, welfare, and safety of our employees and our customers. The additional measures we implemented to safeguard our employees and customers werenew equipment in alignment with guidelines established by the Centers for Disease Control and Prevention. Many of these measures are still in place, including employee communication on COVID-19 symptom awareness, proper hand washing, social distancing, and mask wearing; supporting vaccination against COVID-19 by providing on-site access to the vaccines and the resources to locate a vaccination site; increased cleaning and disinfecting measures; reduced nonessential travel and in-person meetings, including meetings with customers; remote work arrangements for many personnel; installation of glass dividers between workstations; health screening questionnaires for personnel working onsite; and health screening procedures for critical customer visitors.2022.

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We expect all employees to obey and respect human rights laws, and we will not tolerate any conduct that violates these laws. We set the same expectations for our vendors, suppliers, and service providers through our Supplier Code of Conduct. Due toGiven the nature of our industry, we are in a critical position to help raise awareness of human trafficking to potentially disrupt these networks. Through partnerships with Truckers Against Trafficking^® and Polaris, we educate our employees and drivers on the realities of modern-day slavery and how they can play a role in supporting the fight against human trafficking.

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Reputation and Responsibility

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Our Company and our brands are consistently recognized for best-in-class performance.

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Brands

The value of our brands is critical to our success. ArcBest is recognized as a leading integrated logistics providercompany with creative problem solvers who deliver innovative logistics solutions. Beyond this fundamental marketplace recognition of our collective brand identity, our other key brands represent additional unique value in their target markets.

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We have registered or are pursuing registration of various marks or designs as trademarks in the United States, including, but not limited to “ArcBest,” “ABF Freight,” “FleetNet America,” “Panther, Premium Logistics,” “MoLo,” “U-Pack,”

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as a clean, alternative fuel.fuel, and we have two electric forklifts in our Kansas City, Missouri pilot location. In 2022, we purchased four electric yard tractors and two electric Class 6 straight trucks to replace diesel-burning equipment. Additionally, in 2021, we2022, our ArcBest segment began conductingleasing an LEED Gold certified office facility in Chicago, which was constructed to include a demo of an electric battery yard tractor at one of our distribution centers.green roof, smart lighting, and energy-efficient HVAC units, as well as additional environmentally preferred features.

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Contributions & Awards

We have a corporateOur culture is focused on quality service and responsibility. Ourresponsibility, and our employees are committed to the communities in which they live and work. We make financial contributions to a number of charitable organizations, many of which are supported by our employees. These employees volunteer their time and expertise, and many serve as officers or board members of various charitablephilanthropic organizations. In November 2022, to help guide our actions in our giving efforts, we announced our three philanthropic pillars — Community, Education and People. In the local community of our corporate headquarters, we have been a long-time supporter of the United Way of Fort Smith Area and its partner organizations. In 2021,2022, with employee support, we again earned the United Way’s coveted Pacesetter award by setting the standard for leadership and community support. ArcBest was voted the Times Record “Best of the Best” place to work in the Fort Smith, Arkansas region in 2020 for the third consecutive yearholds an A+ culture rating by employees via Comparably, and is a three-time recipient of the “Healthy Workplace Award” from the Fort Smith Regional Chamber of Commerce. Wewe support our employees as they carry out our wellness value by participating in healthy workplace initiatives within the workplace and by representing our company in wellness events in their local communities.

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In addition to the recognition noted above, ArcBest has been recognized with the following awards since 2020:2021:

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Asset-Based Segment

Our Asset-Based carrier ABF Freight has received the following awards duringsince 2021:

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Our Asset-Based segment is dedicated to safety and security in providing transportation and freight-handling services to its customers. ABF Freight is a ten-time winner of the American Trucking Associations’ Excellence in Security Award, an eight-time winner of the Excellence in Claims & Loss Prevention Award and a seven-time winner of the President’s Trophy for Safety.Safety from the American Trucking Associations. In January 2022, two ABF Freight drivers were named by the American Trucking Associations as captains of the 2022-2023 “America’s Road Team,” continuing the long-time tradition of ABF Freight’s representation in this select program based on the drivers’ exceptional safety records and their strong commitment to safety and professionalism.

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ABF Freight also partners with the IBT and the U.S. Army in the Teamsters Military Assistance Program, a joint training program to help soldiers transition from military service to civilian careers as professional truck drivers. ABF Freight earned the designation as a 2021 Military Friendly^® Employer for its support of veterans by providing training and employment opportunities in the freight and logistics industry. In 2020, ABF Freight formedhas a partnership with the U.S. Military to train transitioning service members for our management roles through the Department of Defense SkillbridgeSkillBridge program. ABF Freight also participates in the U.S. Army Partnership for Youth Success program. This initiative connects first-term regular Army and Army Reserve soldiers to the civilian workforce by providing two guaranteed job interviews and possible employment after their service in the Army.

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ITEM 1A.RISK FACTORS

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Our business is subject to a variety of material risks about which we are aware. We could also be affected by additional risks and uncertainties not currently known to us or that we currently deem to be immaterial. This Risk Factors section discusses the material risks relating to our business activities, including business risks affecting the transportation industry and our Company that are largely out of our control. If any of these risks or circumstances actually occur, it could materially harm our business, results of operations, financial condition, and cash flows; impair our ability to implement business plans or complete development activities as scheduled; and/or result in a decline in the market price of our common stock.

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Risks Related to Union Relations

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If ABF Freight is unable to reach agreement on future collective bargaining agreements, we could be faced with labor inefficiencies, disruptions, or stoppages, or delayed growth, which could have a material adverse effect on our business, results of operations, financial condition, and cash flows.

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As of December 2022, approximately 82% of our Asset-Based segment’s employees were covered under the 2018 ABF NMFA, the collective bargaining agreement with the IBT that will remain in effect through June 30, 2023. Contract negotiations for the period subsequent to June 30, 2023 are expected to begin in late first quarter or early second quarter 2023. The negotiation of terms of the collective bargaining agreement is a very complex process. There can be no assurance that our future collective bargaining agreements will be renewed on terms favorable to us.  The terms of any future collective bargaining agreements or the inability to agree on acceptable terms for the next contract period may also result in higher labor costs, insufficient operational flexibility, which may increase our operating costs, a work stoppage, the loss of customers, or other events that could have a material adverse effect on our business, results of operations, financial condition, and cash flows. We could also experience a loss of customers or a reduction in our potential share of business in the markets we serve if shippers limit their use of unionized freight transportation service providers because of the risk of work stoppages.

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Risks Related to Significant Unusual Events

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The effects of a widespread outbreak of an illness or disease, including the COVID-19 pandemic, or any other public health crisis, as well as regulatory measures implemented in response to such events, could negatively impact the health and safety of our employees and/or adversely affect our business, results of operations, financial condition, and cash flows.

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Our business has been and, may continue to be negatively impacted byin the ongoing COVID-19 pandemic and couldfuture, may be negatively impacted by the widespread outbreak of another illness, disease, or emergence of another public health crisis, inas we experienced with the future. The COVID-19 pandemic has adversely impacted economic activity and conditions worldwide and created significant volatility and disruption to financial markets.pandemic. Measures intended to prevent the spread of a health epidemic, including regulatory measures and our efforts and costs incurred to comply with them, could alsonegatively impact our operational efficiency and our customers’ demand for our services in the future and, therefore, have an adverse effect on our business.

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The COVID-19 pandemic has adversely impacted, and may continue to adversely impact, economic activity and conditions worldwide, creating significant volatility and disruption to financial markets. Efforts to control the spread of COVID-19 led governments and other authorities to impose restrictions that have resulted in business closures and disrupted supply chains worldwide.Our operations and those of our customers and third-party capacity providers have beenwere subject to these supply chain disruptions to varying degrees due to pandemic-related plant and port shutdowns, transportation delays, government actions, and other factors. The global shortage of certain components, strains on production or extraction of raw materials, record cost inflation, and labor and equipment shortages could escalate in future quarters. The COVID-19 pandemic and measures taken to prevent its spread, including our costs to comply with any regulation, could negatively impact our operational efficiency and our customers’ demand for our services in the future.

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We have experienced declines in our productivity as a result of positive COVID-19 cases in certain locations. As the COVID-19 pandemic continues to evolve, we cannot be certain that we will not experience disruptions to our operations in the future due to regulatory requirements, quarantines, or positive COVID-19 cases among our employees.periods. If a high number of our employees were to contract COVID-19 or another disease or illness or were quarantined, our operations and customer service levels, and, consequently, our results of operations, could be adversely impacted. We do not have insurance coverage specific to losses resulting from a pandemic.

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The extentIn the event of worsening conditions in the continued impactseverity and spread of COVID-19 or another pandemic or other public health crisis that adversely affects the COVID-19 pandemic on our businessU.S. and our employees is uncertain and will depend on future developments, including the duration, transmissibility, and severity of variants and government actions in response to the pandemic. Extended periods of economic disruption and high inflation and resulting declines in industrial production and manufacturing, consumer spending, and demand for our services, as well as the ability of our customers and other business partners to fulfill their obligations, could have a material adverse effect onglobal economies, our results of operations, financial condition, and cash flows could be adversely impacted, and heighten many of the other risks discussed in this Risk Factors section.section may be heightened.

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We, or the third parties who provide services for us, may be adversely affected by external events for which our business continuity plans may not adequately prepare us.

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The occurrence of severe weather, natural disasters, health epidemics, acts of war or terrorism, military conflicts (such as the rising geopolitical tensionswar between Russia and Ukraine), and other adverse external events or conditions that impact us or the operations of third parties who provide services for us have the potential to significantly impact our ability to conduct business. Although we have business continuity plans in place, including an emergency succession plan, there is no guarantee that our plans have adequately addressed each risk and can be successfully implemented. Even if we were to successfully implement our continuity plans, we may incur substantial expenses and there is no guarantee that our business, financial condition, and results of operations will not be materially impacted.

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We engage third parties to provide certain information technology needs, including licensed software, and the inability to maintain these third-party systems or licenses, or any interruptions or failures thereof, could adversely affect our business.

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Certain of our information technologyIT needs are provided or supported by third parties, and we have limited control over the operation, quality, or maintenance of services provided by our vendors or whether they will continue to provide services that are essential to our business. The efficient and uninterrupted operation of our IT systems depends upon the internet, electric utility providers, and telecommunications providers. The IT systems of our third-party service providers are vulnerable to interruption by adverse weather conditions or natural disasters, power loss, telecommunications failures, terrorist attacks,

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If we do not pursue technological advances or engage in innovation, if we fail to successfully or timely develop and deploy enhanced or new technology, or if any enhanced or new technology does not yield the results we expect, or is developed by others, we may be placed at a competitive disadvantage; lose customers; incur higher than anticipated costs, including the possible impact of asset impairment or the write-off of software development costs; or fail to meet the goals of our internal growth strategy, any one of which could materially adversely impact our financial condition and results of operations.

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We may be unsuccessful in realizing all or any part of the anticipated benefits of any recent or future acquisitions within the expected time period or at all. The cost, integration, and performance of any such acquisition may adversely affect our business, results of operations, financial condition, and cash flows.

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As part of our strategy to expand our revenue opportunities and achieve a more balanced business mix, we acquired MoLo Solutions, LLC (“MoLo”) on November 1, 2021. The acquired truckload brokerage operation of MoLo has been included in our ArcBest operating segment and resulted in growth of our Asset-Light operations. We may be unable to generate sufficient revenue or earnings from the operations of MoLo, or any future acquired business, to offset our acquisition or investment costs, and the acquired business may otherwise fail to meet our operational or strategic expectations. Difficulties encountered in combining operations, including underestimation of the resources required to support an acquisition, could prevent us from realizing the full anticipated benefits, and within the anticipated timeframe, and could adversely impact our business, results of operations, and financial condition. If acquired operations fail to generate sufficient cash flows, we may incur impairments of goodwill, intangibles, and other assets in the future.

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The possible risks involved in recent or future acquisitions include, among others:

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We continue to evaluate acquisition candidates and may acquire assets and businesses that we believe complement our existing assets and business or enhance our service offerings. The complex and time-consuming processes of evaluating acquisitions and performing due diligence procedures include risks that may adversely impact the success of our selection of candidates, pricing of the transaction, and ability to integrate critical functional areas of the acquired business. Future acquisitions, if any, may require substantial capital or the incurrence of substantial indebtedness or may involve the dilutive issuance of equity securities, which may negatively impact our capitalization and financial position. Further, we may not be able to acquire any additional companies at all or on terms favorable to us, even though we may have incurred expenses in evaluating and pursuing strategic transactions.

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Damage to our corporate reputation may cause our business to suffer.

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Our business depends, in part, on our ability to maintain the image of our brands. Service, performance, and safety issues, whether actual or perceived and whether as a result of our actions or those of our third-party service providers, could adversely impact our customers’ image of our brands, including ArcBest, ABF Freight, MoLo,FleetNet America, Panther, Premium Logistics, FleetNet America,MoLo, and U-Pack, and result in the loss of business or impede our growth initiatives. Adverse publicity regarding labor relations, legal matters, cybersecurity and data privacy concerns, environmental, social and governance (“ESG”)ESG issues, and similar matters, whether or not justified, could have a negative impact on our reputation and may result in the loss of customers and our inability to secure new customer relationships. Despite our efforts to adapt to and address these concerns, our efforts may be insufficient, and our industry may be generally disfavored by the investing community at large. Additionally, the implementation of initiatives, including our ESG initiatives, which are detailed on our website, may increase our costs. It is difficult to predict how our efforts with respect to social and sustainability matters will be evaluated by current and prospective investors or by our customers or business partners.

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Our business, including the self-service moving offerings provided under our U-Pack brand, is increasingly dependent on the internet for attracting and securing customers, and the possibility that fraudulent behavior may confuse or deceive customers heightens the risk of damage to our reputation and increases the time and expense required to protect and maintain the integrity of our brands.

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2021 and, to a lesser extent, 2022 were reduced due to parts shortages and manufacturing disruptions.disruptions of OEMs. As a result, a portion of our previously planned capital expenditures for 2021 and 2022 carried over into our 2022 and 2023 investment plans.plans, respectively. When market forces result in demand outstripping supply, we have and may continue to face reduced supply levels and/or increased acquisition costs for new tractors or trailers, as well as related parts and services, for our Asset-Based operations, which could have a material adverse effect on our business and growth initiatives, results of operations, financial condition, and financial condition.cash flows.

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plans, there are risks associated with participation in these plans that differ from single-employer plans. Assets received by the plans are not segregated by employer, and contributions made by one employer can be and are used to provide benefits to current and former employees of other employers. If a participating employer in a multiemployer pension plan no longer contributes to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. If a participating employer in a multiemployer pension plan completely withdraws from the plan, it owes to the plan its proportionate share of the plan’s unfunded vested benefits, referred to as a withdrawal liability. A complete withdrawal generally occurs when the employer permanently ceases to have an obligation to contribute to the plan. Withdrawal liability is also owed in the event the employer withdraws from a plan in connection with a mass withdrawal, which generally occurs when all or substantially all employers withdraw from the plan in a relatively short period of time pursuant to an agreement. Were ABF Freight to completely withdraw from certain multiemployer pension plans, whether in connection with a mass withdrawal or otherwise, under current law, we would have material liabilities for our share of the unfunded vested liabilities of each such plan.

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The multiemployer pension plans to which ABF Freight contributes vary greatly in size and in funded status. Many of the multiemployer pension plans to which ABF Freight contributes are underfunded and, in some cases, significantly underfunded, as further discussed in Note J to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

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The American Rescue Plan Act Such underfunding could increase the size of 2021 was signed into law on March 11, 2021 and includes the Butch Lewis Emergency Pension Plan Relief Act of 2021 (the “Pension Relief Act”), which includes provisions to improve funding for multiemployer pension plans, including financial assistance provided to qualifying underfunded plans through the Pension Benefit Guarantee Corporation (the “PBGC”) to secure pension benefits for plan participants. On July 9, 2021, the PBGC announced an interim final rule implementing a Special Financial Assistance Program to administer funds to severely underfunded eligible multiemployer pension plans under the Pension Relief Act. We are monitoring the impact these legislative actions may have on the funding status of the multiemployer pension plans to which ABF Freight contributes; however, we cannot determine with any certainty the minimum contributions that will be required under future collective bargaining agreements or the impact they will have on our results of operations and financial condition.  

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potential withdrawal liability. ABF Freight’s obligations to these plans are generally specified in the 2018 ABF NMFA and other related supplemental agreements. These pension plans provide the best retirement benefits in the industry. However, when compared to competitors, ABF Freight pays some of the highest benefit contribution rates in the industry and continues to address the effect of the Asset-Based segment’s wage and benefit cost structure on its operating results in discussions with the IBT. Through the term of its current collective bargaining agreement, ABF Freight’s multiemployer pension obligations generally will be satisfied by making the specified contributions when due. Future contribution rates will be determined through the negotiation process for contract periods following the term of the current collective bargaining agreement.

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Certain legislative actions which include provisions to improve funding for multiemployer pension plans became effective during 2021 and 2022, as further discussed in Note J to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K. However, despite such legislative actions, we may still trigger withdrawal liability through, among other things, mergers and other fundamental corporate transactions and, as a result of operational changes, site closures and job losses. We continue to monitor the impact these legislative actions have on the funding status of the multiemployer pension plans to which ABF Freight contributes; however, we cannot determine with any certainty the minimum contributions that will be required under future collective bargaining agreements or the impact they will have on our results of operations and financial condition.  

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Risks Related to Third Parties

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We depend on services provided by third parties, and increased costs or disruption of these services, and claims arising from these services, could adversely affect our business, results of operations, financial condition, cash flows, and customer relationships.

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A reduction in the availability of rail services or services provided by third-party capacity providers to meet customer requirements, as well as higher utilization of third-party agents to maintain service levels in periods of tonnage growth or higher shipment levels, could increase purchased transportation costs which we may be unable to pass along to our customers. If a disruption or reduction in transportation services from our rail or other third-party service providers were to occur, we could be faced with business interruptions that could cause us to fail to meet the needs of our customers. In addition, third-party providers can be expected to increase their prices based on market conditions or to cover increases in operating expenses. If we are unable to correspondingly increase the prices we charge to our customers, or if we are unable to secure sufficient third-party services to expand our capacity, add additional routes, or meet our commitments to our customers, there could be a material adverse impact on our operations, revenues, profitability and customer relationships.

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In addition, we may be subject to claims arising from services provided by third parties, particularly in connection with the operations of our ArcBest segment, which are dependent on third-party contract carriers. From time to time, the drivers who are owner operators, independent contractors, or employees working for third-party carriers that we contract with are involved in accidents or incidents that may result in cargo loss or damage, other property damage, or serious personal injuries including death. As a result, claims may be asserted against us for actions by such drivers or for our actions in contracting with them initially or retaining them over time. We or our subsidiaries could be held directly responsible for these third-party claims and, regardless of ultimate liability, may incur significant costs and expenses in defending these claims.claims or through settlements, even in cases where we believe we have meritorious claims or defenses. We may also incur claims in connection with third-party vendors utilized in FleetNet’s operations. Our third-party contract carriers and other vendors may not agree to bear responsibility for such claims, or we may become responsible if they are unable to pay the claims, for example, due to bankruptcy proceedings, and such claims may exceed the amount of our insurance coverage or may not be covered by insurance at all.

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Our engagement of independent contractor drivers to provide a portion of the capacity for our ArcBest segment exposes us to different risks than we face with our employee drivers. If we have difficulty in securing independent owner operators, or if we incur increased costs to utilize independent owner operators, our financial condition, results of operations, and cash flows could be adversely affected.

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The driver fleet for portions of our ArcBest segment is made up of independent owner operators and individuals. We face intense competition in attracting and retaining qualified owner operators from the available pool of drivers and fleets, and we may be required to increase owner operator compensation or take other measures to remain an attractive option for owner operators, which may negatively impact our results of operations. If we are not able to maintain our delivery schedules due to a shortage of drivers or if we are required to increase our rates to offset increases in owner operator compensation, our services may be less competitive, which could have an adverse effect on our business. Furthermore, as these independent owner operators and individuals are third-party service providers, rather than our employees, they may decline loads of freight from time to time, which may impede our ability to deliver freight in a timely manner. If we fail to meet certain customer needs or incur increased expenses to do so, this could adversely affect the business, financial condition, and results of operations of our ArcBest segment.

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Additionally, we pay independent contractor drivers a fuel surcharge that increases with the increase in fuel prices. A significant increase or rapid fluctuation in fuel prices could cause the fuel surcharge we pay to independent contractors to be higher than the revenue we receive under our customer fuel surcharge programs, which could adversely impact the results of operations of our ArcBest segment.

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If the independent contractors with which we contract with are deemed by regulators or judicial process to be employees, or if we experience operational or regulatory issues related to our use of these contract drivers, our financial condition, results of operations, and cash flows could be adversely affected.

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Class actions and other lawsuits have arisen in the transportation and logistics industry seeking to reclassify independent contractor drivers as employees for a variety of purposes, including workers’ compensation, wage-and-hour, and health care coverage. Many states have enacted restrictive laws that make it difficult to successfully prove independent-contractor status, and all states have enforcement programs to evaluate the classification of independent contractors. In the event of such reclassification of our owner operators, we could be exposed to various liabilities and additional costs, for both future and prior periods, under federal, state, and local tax laws, and workers’ compensation, unemployment benefits, labor, and employment laws, as well as potential liability for penalties and interest and under vicarious liability principles. Such liabilities and costs, to the extent they arise, could have a material adverse effect on the results of operations and financial condition of our ArcBest segment.

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liability, and other matters. We are subject to risk and uncertainties related to liabilities, including damages, fines, penalties, and substantial legal and related costs, that may result from these claims and litigation. Some or all of our expenditures to defend, settle, or litigate these matters may not be covered by insurance or could impact our cost of, and ability to obtain, insurance in the future. Also, litigation can be disruptive to normal business operations and could require a substantial amount of time and effort from our management team. Further, because of the potential risks, expenses, and uncertainties of litigation, we may, from time to time, settle disputes, even where we believe that we have meritorious claims or defenses. Any material litigation or a catastrophic accident or series of accidents could have a material adverse effect on our business, results of operations, and financial condition. Our business reputation and our relationship with our customers, suppliers, and employees may also be adversely impacted by our involvement in legal proceedings.

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We establish reserves based on our assessment of known legal matters and contingencies. New legal claims, or subsequent developments related to known legal claims, asserted against us may affect our assessment and estimates of our recorded legal reserves and may require us to make payments in excess of our reserves, which could have a material adverse effect on our financial condition or results of operations. Also see Item 3 (Legal Proceedings) included in Part I of this Annual Report on Form 10-K for disclosure of a legal matter for which we believe a loss, that could be material to our financial condition, results of operations, or cash flows, is reasonably possible.

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Our business operations are subject to numerous governmental regulations in the transportation industry, and costs of compliance with, or liability for violations of, existing or future regulations could have a material adverse effect on our financial condition and results of operations.

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Various international, federal, state and local agencies exercise broad regulatory powers over the transportation industry, such as those described in “Environmental and Other Government Regulations” within Part I, Item 1 (Business) of this Annual Report on Form 10-K. We could become subject to new or more restrictive regulations, and the costs to comply with such regulations could increase our operating expenses or otherwise have a material adverse effect on the results of our operations. Such regulations could also influence the demand for transportation services. Failure to comply with laws and regulations can result in penalties, revocation of our permits or licenses, or both civil and criminal actions against us. In addition to the potential harm to our reputation and brands, the financial burdens resulting from such actions could have a material adverse effect on our financial condition and results of operations.

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Failures by us, or our contracted owner operators and third-party carriers, to comply with the various applicable federal safety laws and regulations, or downgrades in our safety rating, could have a material adverse impact on our operations or financial condition, and could cause us to lose customers, as well as the ability to self-insure. The loss of our ability to self-insure for any significant period of time could materially increase insurance costs, or we could experience difficulty in obtaining adequate levels of insurance coverage.

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Our ArcBest segment utilizes third-party service providers who are subject to similar regulatory requirements. If the operations of these providers are impacted to the extent that a shortage of quality third-party service providers occurs, or if we experience a shortage of quality third-party vendors utilized in FleetNet’s operations, there could be a material adverse effect on the business and results of operations of our ArcBest and FleetNet segments. Also, activities by these providers that violate applicable laws or regulations could result in governmental or third-party actions against us. Although third-party service providers with whom we contract agree to comply with applicable laws and regulations, we may not be aware of, and may therefore be unable to address or remedy, violations by them.

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We are also subject to stringent and changing privacy laws, regulations and standards as well as policies, contracts and other obligations related to data privacy, including customer and employee data. As a provider of worldwide transportation and logistics services, we collect and process significant amounts of customer data on a daily basis. Recently,In recent years, there have been global efforts by governments and consumer groups for increased transparency in how customer data is utilized and how customers and employees can control the use and storage of their data. Complying with existing or new data protection laws and regulations may increase our compliance costs or require us to modify our data handling practices. Non-compliance could result in governmental or consumer actions against us and even perceived non-compliance may otherwise adversely impact

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Our operations are subject to various environmental laws and regulations, the violation of which could result in substantial fines or penalties. The costs of compliance with current and future environmental laws and regulations may be significant and could adversely impact our results of operations.

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We routinely transport or arrange for the transportation of hazardous materials and explosives, and, at certain facilities of our Asset-Based operations, we store fuel and oil in underground and aboveground tanks and other containers. In connection with these operations, we are subject to federal, state and local environmental laws and regulations relating to, among other areas: emission controls, transportation of hazardous materials, underground and aboveground storage tanks, stormwater pollution prevention, contingency planning for spills of petroleum products, and disposal of waste oil. We may be subject to substantial fines, civil penalties, or third-party initiated lawsuits if we fail to obtain proper certifications or permits or if we do not comply with required environmental inspections and testing provisions. Under certain environmental laws, we could be subject to strict liability for any clean-up costs relating to contamination at our past or present facilities and at third-party waste disposal sites, as well as costs associated with the cleanup of accidents involving our vehicles.

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These operationsThe transportation of hazardous materials or explosives also involveinvolves the risks of, among others, fuel spillage or leakage, environmental damage, a spill or accident involving hazardous substances, and hazardous waste disposal. In addition, if any damage or injury occurs as a result of our transportation of hazardous materials or explosives,these operations, we may be subject to claims from third parties and bear liability for such damage or injury.

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Although we have instituted programs to monitor and control environmental risks and promote and maintain compliance with applicable environmental laws and regulations, violations of applicable laws or regulations may subject us to clean-up costs and liabilities not covered by insurance or in excess of our applicable insurance coverage, including substantial fines, civil penalties, or civil and criminal liability, as well as bans on making future shipments in particular geographic areas, any of which could adversely affect our business, results of operations, financial condition, and cash flows.

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Concern over climate change, including the impact of global warming, has led to significant legislative and regulatory efforts to limit carbon and other GHG emissions, and some form of federal, state, and/or regional climate change legislation is possible in the future. Emission-related regulatory actions have historically resulted in increased costs of revenue equipment, diesel fuel, and equipment maintenance, and future legislation, if enacted, could impose substantial costs on us that may adversely impact our results of operations. Such regulatory actions may require changes in our operating practices, and impair equipment productivity.productivity, or require additional reporting disclosures. Compliance with laws and regulations related to climate risk may also increase our exposure to litigation or governmental investigations or proceedings. We may also incur significant costs to comply with increased regulation regarding environmental monitoring and reporting requirements. We are subject to increasing investor and customer sensitivity to sustainability issues, and we may be subject to additional requirements related to shareholder proposals, customer-led initiatives, or our customers’ efforts to comply with environmental programs. Until the timing, scope, and extent of any future regulation or customer requirements become known, we cannot predict their effect on our cost structure, business, or results of operations.

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Risks Related to Financial Considerations

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We are subject to interest rate risk and certain covenants under our financing arrangements. A default under these financing arrangements or changes in regulations that impact the availability of funds, or our borrowing costs could cause a material adverse effect on our liquidity, financial condition, and results of operations.

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We are affected by the instability in the financial and credit markets that from time to time has created volatility in various interest rates and returns on invested assets in recent years.assets. We are subject to market risk due to variable interest rates on our borrowings on the accounts receivable securitization program (“A/R Securitization”) and the revolving credit facility (“Credit Facility”) under our ThirdFourth Amended and Restated Credit Agreement (the “Credit Agreement”). Although we have an interest rate swap agreement to mitigate a portion of our interest rate risk by effectively converting $50.0 million of borrowings under our Credit Facility, of which $115.0$50.0 million remains outstanding at the end of February 2022,2023, from variable-rate interest to fixed-rate interest, changes in interest rates may increase our financing costs related to our Credit

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commitments to us are adversely affected by economic conditions, disruption to the capital and credit markets, or increased regulation, they may become unable to fund borrowings under their credit commitments or otherwise fulfill their obligations to us, which could have an adverse impact on our ability to borrow additional funds, and thus have an adverse effect on our operations and financial condition. See Note G to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for further discussion of our financing arrangements.

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Our Credit Agreement and A/R Securitization contain customary financial covenants and other customary restrictive covenants that may limit our future operations. Failing to achieve certain required financial ratios could adversely affect our ability to finance our operations, make strategic acquisitions or investments, or plan for or react to market conditions or otherwise execute our business strategies.

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If we default under the terms of the Credit Agreement or our A/R Securitization and fail to obtain appropriate amendments to or waivers under the applicable financing arrangement, our borrowings under such facilities could be immediately declared due and payable. An event of a default under either of these facilities could constitute automatic default on the other of these facilitiesfacility and could trigger cross-default provisions in our outstanding notes payable and other financing agreements, unless the lenders to these facilities choose not to exercise remedies or to otherwise allow us to cure the default. If we fail to pay the amount due under our Credit Facility or A/R Securitization, the lenderslender of the A/R Securitization could proceed against the collateral by which thethat facility is secured, our borrowing capacity may be limited, or one or both of the facilities could be terminated. If acceleration of outstanding borrowings occurs or if one or both of the facilities is terminated, we may have difficulty borrowing additional funds sufficient to refinance the accelerated debt or entering into new credit or debt arrangements, and, if available, the terms of the financing may not be favorable or acceptable. A default under the Credit Agreement or A/R Securitization, changes in regulations that impact the availability of funds or our borrowing costs, or our inability to renew our financing arrangements with terms that are acceptable to us, could have a material adverse effect on our liquidity and financial condition.

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Our business is capital intensive. If we are unable to generate sufficient cash from operations, our growth and profitability could be limited due to significant ongoing capital expenditure requirements.

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We depend on cash flows from operations, borrowings under our Credit Facility or our A/R Securitization, and operating and financing leases to fund our capital expenditures. We continue to invest significantly in our revenue equipment fleet, which helps us reduce our maintenance costs and has resulted in the Company having one of the newest fleets on the road. If we are unable to generate sufficient cash over an extended period of time from operations to fund our capital requirements, we may have to limit our growth, including our ability to invest in technological initiatives that drive business efficiencies; utilize our existing liquidity or enter into additional financing arrangements, including leasing arrangements; or operate our revenue equipment for longer periods resulting in increased maintenance costs, any of which could negatively impact our financial condition and results of operations.

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Claims expenses or the cost of maintaining our insurance, including medical plans, could have a material adverse effect on our results of operations and financial condition.

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Claims may be asserted against us for cargo loss or damage, property damage, personal injury, and workers’ compensation related to accidents or events occurring in our operations. Claims may also be asserted against us for accidents involving the operations of third-party service providers that we utilize, for our actions in retaining their services, for loss or damage to our customers’ goods or other damages for which we are alleged or may be determined to be responsible. Such claims against us and associated costs and legal expenses may not be covered by insurance policies or may exceed the amount of insurance coverage or our established reserves, which could adversely impact our results of operations and financial condition. If the frequency and/or severity of claims increase, our operating results could be adversely affected. The timing of the incurrence of these costs could significantly and adversely impact our operating results.

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We are primarily self-insured for workers’ compensation, third-party casualty loss, and cargo loss and damage claims for the operations of our Asset-Based segment and certain of our other subsidiaries. We also self-insure for medical benefits for our eligible nonunion personnel. Because we self-insure for a significant portion of our claims exposure and related expenses, our insurance and claims expense may be volatile. If we lose our ability to self-insure for any significant period of time, insurance costs could materially increase, and we could experience difficulty in obtaining adequate levels of insurance coverage. Our self-insurance program for third-party casualty claims is conducted under a federal program administered by a government agency. If the government were to terminate the program or if we were to be excluded from the program, our insurance costs could increase. Additionally, if our third-party insurance carriers or underwriters leave

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the trucking sector, our insurance costs or collateral requirements could materially increase, or we could experience difficulties in finding insurance in excess of our self-insured retention limits. In recent years, several insurance companies have completely stopped offering coverage to trucking companies or have significantly reduced the amount of coverage they offer or have significantly raised premiums as a result of increases in the severity of automobile liability claims and sharply higher costs of settlements and verdicts. Our insurance premiums or deductibles could increase in the future due to market conditions or if our claims experience worsens. The impact of climate change, including its effect on weather-related events which may disrupt our operations or damage our property and equipment, may increase our claims liabilities

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for our services may also be negatively impacted when economic conditions lead to a decrease in shipping demand, which in turn results in excess tractor and trailerequipment capacity in the industry. In certain market conditions, we may have to accept more freight from freight brokers, where freight rates are typically lower, or we may be forced to incur more non-revenue miles to obtain loads. Conversely, during times of higher shipping demand, tight equipmentmarket capacity in the industry may negatively impact the service levels we are able to provide to our customers. Demand for our roadside assistance and fleet maintenance management services may also decline in a weaker economic environment when customers of our FleetNet segment experience declines in their equipment utilization.utilization or delay maintenance needs.  

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Economic conditions could adversely affect our customers’ business levels, the amount of transportation services they require, and their ability to pay for our services, which could negatively impact our working capital and our ability to satisfy our financial obligations and covenants of our financing arrangements. Customers encountering adverse economic conditions or facing credit issues could experience cash flow difficulties and, thus, represent a greater potential for payment delays or uncollectible accounts receivable, and, as a result, we may be required to increase our allowances for uncollectible accounts receivable. Our obligation to pay third-party service providers is not contingent upon payment from our customers, and we extend unsecured credit to these customers, which increases our exposure to uncollectible receivables.

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Inflation and rising interest rates may adversely affect us by increasing costs beyond what we can recover through price increases.

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Inflation in the United States climbed towas at its highest level in 40 years atby the end of 2021.June 2022 and although the inflation rate slowed slightly during the second half of 2022, it remains above market forecasts as of January 2023. Significant inflation can adversely impact our results of operations and financial condition by increasing interest rates and the cost of equipment, labor,equipment. Most of our operating expenses are sensitive to increases in inflation, including fuel, insurance, employee wages and benefits, purchased transportation, fuel, and other expenses.depreciation due to higher equipment prices. Further, inflation may generally increase costs for materials, supplies, services, and capital. In a highly inflationary environment, we may be unable to secure adequate price increases for our services to offset the increases in our operating costs, which could reduce our operating margins.

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Our business and results of operations could be impacted by seasonal fluctuations, adverse weather conditions, natural disasters, and climate change.

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Our operations are, and may in the future be, impacted by seasonal fluctuations and, at times, inclement weather conditions that affect tonnage and shipment levels, service events, demand for our services, and operating costs, which in turn may impact our revenues and operating results, as further described in “Seasonality” within Part I, Item 1 (Business) of this Annual Report on Form 10-K. Climate change may have an influence on the severity of weather conditions. Severe weather events and natural disasters could disrupt our operations or the operations of our customers or third-party service providers, damage existing infrastructure, destroy our assets, affect regional economies, or disrupt fuel supplies or increase fuel costs, eachany of which could adversely affect our business levels and operating results.

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ITEM 1B.UNRESOLVED STAFF COMMENTS

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None.

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ITEM 2.PROPERTIES

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The Company believes that its facilities, including owned and leased properties, are suitable and adequate and that the facilities have sufficient capacity to meet current business requirements. The Company owns an office facility in Fort Smith, Arkansas, containing 205,000 square feet, which provides space for certain corporate and certain subsidiary functions. The Company also leases a secondaryan office building in Fort Smith, Arkansas which contains 18,000 square feet.for certain subsidiary functions.

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Asset-Based Segment

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As of December 31, 2021, theThe Asset-Based segment operatedoperates out of its general office building located in Fort Smith, Arkansas which contains 196,800 square feet, and 239 revenue producing facilities, 10 of which also serve as distribution centers. The Company owns 108110 of these Asset-Based segment facilities and leases the remainder from nonaffiliates. Asset-Based distribution centers are as follows:

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Asset-Light Operations

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The ArcBest segment owns a general office building and service bay in Medina, Ohio totaling 59,600 square feet. Additionally, the ArcBest segmentand leases six additional office and warehouse locations, including an office and warehouse location in Sparks, Nevada totaling approximately 129,600 square feet and five other locations with approximately 88,500 square feet ofan office and warehouse space, includinglocation in Chicago, Illinois and Plano, Texas.

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Illinois. The FleetNet segment owns its officesoffice located in Cherryville, North Carolina containing approximately 38,900 square feet.Carolina.

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ITEM 3.LEGAL PROCEEDINGS

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Various legal actions, the majority of which arise in the normal course of business, are pending. These legal actions are not expected to have a material adverse effect, individually or in the aggregate, on our financial condition, results of operations, or cash flows. We maintainThe Company maintains liability insurance against certain risks arising out of the normal course of business, subject to certain self-insured retention limits. We have accrualsThe Company has amounts accrued for certain legal, environmental, and self-insurance exposures. These exposures and legal actions which arise in the normal course of business are not expected to have a material adverse effect, individually or in the aggregate, on the Company’s financial condition, results of operations, or cash flows.

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In January 2023, ArcBest Corporation and MoLo Solutions, LLC were added as defendants in five separate lawsuits all arising from a single multi-fatality auto accident involving one of MoLo’s contract carriers. The accident occurred in June 2021 in Baxter County, Alabama, and the cases are pending in the state and federal courts therein situated. The accident occurred prior to the Company’s acquisition of MoLo. The lawsuits allege that MoLo was negligent in the selection of the motor carrier involved in the accident. The Company intends to vigorously defend against these lawsuits. Although a range of reasonably possible losses for this matter cannot be estimated at this time, it is reasonably possible that such amounts could be material to the Company’s financial condition, results of operations, or cash flows. The Company will pursue recovery for its losses, if any, against all available sources, including, but not limited to, insurance and any potentially responsible third parties.

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For additional information related to our environmental and legal matters, see Note O to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

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ITEM 4.MINE SAFETY DISCLOSURES

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Not applicable.

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ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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ArcBest Corporation^™ (together with its subsidiaries, the “Company,” “ArcBest^®,” “we,” “us,” and “our”) providesis a comprehensivemultibillion-dollar integrated logistics company that leverages technology and a full suite of freight transportationshipping and integrated logistics servicessolutions to deliver innovative solutions.meet our customers’ supply chain needs. Our operations are conducted through our three reportable operating segments:

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The ArcBest and the FleetNet reportable segments combined represent our Asset-Light operations. SeeFor more information, see additional segment descriptions in Part I, Item 1 (Business) and in Note N to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K. References to the Company, including “we,” “us,” and “our,” in this Annual Report on Form 10-K, are primarily to the Company and its subsidiaries on a consolidated basis.

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ORGANIZATION OF INFORMATION

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Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided to assist readers in understanding our financial performance during the periods presented and significant trends which may impact our future performance.performance, including the principal factors affecting our results of operations, liquidity and capital resources, and critical accounting policies. MD&A includes additional information about significant accounting policies, practices, and the transactions that underlie our financial results. This discussion should be read in conjunction with our consolidated financial statements and the related notes thereto included in Part II, Item 8 of this Annual Report on Form 10-K. MD&A includes forward-looking statements that are subject to risks and uncertainties. Actual results may differ materially from the statements made in this section due to a number of factors that are discussed in Part I (Forward-Looking Statements) and Part I, Item 1A (Risk Factors) of this Annual Report on Form 10-K. MD&A is comprised of the following:

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RESULTS OF OPERATIONS

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This Results of Operations section of MD&A generally discusses 2022 and 2021 items and year-to-year comparisons between 2022 and 2021. Discussions of 2020 items and year-to-year comparisons between 2021 and 2020. Discussions of 2019 items and year-to-year comparisons between 2020 and 2019 that are not included in this Form 10-K can be found in the Results of Operations section of MD&A in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.2021.

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Consolidated operating income increased $182.7 million in 2021, compared to 2020, primarily due to the improved operating results of our operating segments.Light Results sections). The year-over-year comparisonscomparison of consolidated operating income werewas also impacted by items described in the following paragraphs, including costs related to investments in innovative technology, costs related to the MoLo acquisition, a gaingains on the sale of a subsidiary, and gains on the sale of property and equipment.costs associated with enhancements to our nonunion vacation policy.

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Innovative technology costs related to our freight handling pilot test program at ABF Freight are discussed in the Asset-Based Segment Results section. Initiatives to optimize our performance through technological innovation, including certain costs related to the pilot program at ABF Freight and costs related to our investment in human-centered remote operation software, are reported in the “Other and eliminations” line of consolidated operating income. These combined costs impacted consolidated results by $40.8 million (pre-tax), or $30.8 million (after-tax) and $1.21 per diluted share, for 2022, compared to $32.8 million (pre-tax), or $24.9 million (after-tax) and $0.93 per diluted share, for 2021.

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The MoLo acquisition impacted consolidated operating results in 2022 and 2021, including the change in the liability for contingent earnout consideration, the amortization of acquired intangible assets related to the acquisition, and, in 2021, transaction costs associated with the acquisition. The liability for contingent consideration recorded for the MoLo acquisition is remeasured at each quarterly reporting date, and any change in fair value as a result of the recurring assessments is recognized in operating income. The quarterly remeasurement of the contingent consideration reduced the consolidated results for 2022, by a total of $18.3 million (pre-tax), or $13.6 million (after-tax) and $0.54 per diluted share. (The contingent earnout consideration is further discussed in Note D to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.) Transaction costs associated with the MoLo acquisition impacted consolidated results by $6.0 million (pre-tax), or $4.4 million (after-tax) and $0.16 per diluted share, for 2021. AmortizationThe amortization of acquired intangible assets related to the acquisition of MoLo and previously acquired businesses in the ArcBest segment of Asset-Light operationsimpacted consolidated operating results for 2022 by $12.9 million (pre-tax), or $9.6 million (after-tax) and $0.38 per diluted share. For 2021, these costs impacted consolidated results by $5.3 million (pre-tax), or $3.9 million (after-tax) and $0.15 per diluted share, for 2021. For 2020, amortization of acquired intangible assets related to previously acquired business in the ArcBest segment impacted consolidated results by $3.7 million (pre-tax), or $2.8 million (after-tax) and $0.11 per diluted share.

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Consolidated operating results also benefited from the sale of a portion of our ArcBest segment’s moving labor services business in second quarter 2021, for which resulteda gain of $0.4 million (pre-tax), or $0.3 million (after-tax) and $0.01 per diluted share, was recognized for 2022 upon release of the funds related to the sale from escrow in asecond quarter 2022, compared to the gain of $6.9 million (pre-tax), or $5.4 million (after-tax) and $0.20 per diluted share, and gains on the salein 2021. Consolidated operating results for 2022 were also impacted by a one-time, noncash charge of property and equipment, which increased $6.1 million in 2021, compared to 2020.

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Innovative technology costs related to our freight handling pilot test program at ABF Freight, as further discussed in the Asset-Based Segment Results section, and other initiatives to optimize our performance through technological innovation, including costs related to our investment in human-centered remote operation software which are reported in the “Other and eliminations” line of consolidated operating income, impacted consolidated results by $32.8$2.1 million (pre-tax), or $24.9$1.5 million (after-tax) and $0.93$0.06 per diluted share, for 2021, comparedenhancements to $25.6 million (pre-tax), or $19.6 million (after-tax) and $0.74 per diluted share, for 2020. On a consolidated basis, we expect these innovative technology costs to approximate $9.5 million (pre-tax) for firstour nonunion vacation policy which were effective in third quarter and $38 million (pre-tax) for full-year 2022.

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In addition to the above items, consolidated net income and earnings per share were impacted by income from changes in the cash surrender value of variable life insurance policies, tax benefits from the vesting of share-based compensation awards, tax credits, and other changes in the effective tax rate as described within the Income Taxes section of MD&A. A portion of our variable life insurance policies have investments, through separate accounts, in equity and fixed income securities and, therefore, are subject to market volatility. Changes in the cash surrender value of life insurance policies, which are reported below the operating income line in the consolidated statements of operations, increased consolidated net income by $2.7 million and $0.11 per diluted share in 2022, and decreased consolidated net income by $4.1 million and $0.15 per diluted share in 2021, versus $2.3 million and $0.09 per diluted share in 2020.2021.

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Consolidated net income and earnings per share were impacted by $2.0 million and $0.08 per diluted share in 2021, and $2.1 million and $0.08 per diluted share in 2020, for a research and development tax credit. The vesting of restricted stock units resulted in a tax benefit of $8.1 million and $0.32 per diluted share for 2022, compared to a tax benefit of $7.6 million and $0.29 per diluted share in 2021. The year-over-year comparisons of consolidated net income and earnings per share for 2022 and 2021 compared to a tax expense of $0.5 million and $0.02 per diluted share in 2020. Thewere also impacted by tax benefits and credits, as well as other changes in the effective tax rates, which impacted the year-over-year comparisons of consolidated net income and earnings per share for 2021 and 2020 are further described within the Income Taxes section of MD&A and in Note F to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

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