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RXO, INC.

11215 North Community House Road

Charlotte, North Carolina 28277

To Be Held on May 20, 2024

To the Stockholders of RXO, Inc.

Notice is hereby given that the 2024 Annual Meeting of Stockholders of RXO, Inc. will be held on Monday, May 20, 2024 at 10:00 a.m. Eastern Time. The meeting will be conducted exclusively as a live webcast. You can access the meeting at www.virtualshareholdermeeting.com/RXO2024 with your control number.

The Annual Meeting will be held for the purposes summarized below, and more fully described in the Proxy Statement accompanying this notice.

Only stockholders of record of our common stock, par value $0.01 per share, as of the close of business on March 25, 2024, are entitled to receive notice of, and to vote at, the Annual Meeting or any adjournment or postponement of the Annual Meeting. A complete list of registered stockholders will be available after entering the control number included on the Notice of Internet Availability of Proxy Materials or any proxy card that you received, or on the materials provided by your bank or broker.

Your vote is important. Whether or not you plan to attend the Annual Meeting, it is important that your shares be represented. We ask that you vote your shares as soon as possible.

By order of the Board of Directors,

 

 

Brad Jacobs

Chairman of the Board

Charlotte, North Carolina

April 8, 2024

Important Notice Regarding the Availability of Proxy Materials for the

Annual Meeting of Stockholders to Be Held on May 20, 2024:

The Proxy Statement and our Annual Report on Form 10-K for the Year Ended December 31, 2023 are available at investors.rxo.com.

This Proxy Statement sets forth information relating to the solicitation of proxies by the Board of Directors of RXO, Inc. in connection with our 2024 Annual Meeting of Stockholders. This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all the information that you should consider, and you should read the entire Proxy Statement carefully before voting.

This Proxy Statement and form of proxy are first being mailed on or about April 8, 2024, to our stockholders of record as of the close of business on March 25, 2024 (the “Record Date”).

Admission: You are invited to attend the annual meeting of stockholders of RXO, Inc. The Annual Meeting will be a virtual meeting of stockholders. You will be able to attend the Annual Meeting at www.virtualshareholdermeeting.com/RXO2024. You will need to provide the control number on your proxy card to access the Annual Meeting. If the shares of common stock you hold are in an account at a broker, dealer, commercial bank, trust company or other nominee (i.e., in “street name”), you must register in advance to participate in the Annual Meeting, to vote electronically and to submit questions during the live webcast of the meeting. To register in advance, you must obtain a legal proxy from the bank, broker or other nominee that holds your shares, giving you the right to vote the shares. At the time of the meeting, go to www.virtualshareholdermeeting. com/RXO2024 and enter your control number.

The Board is not aware of any matter that will be presented for a vote at the Annual Meeting other than those shown below.

Our Board aims to create a diverse and highly skilled team of directors who provide RXO with thoughtful board oversight. When selecting new directors, our Board considers, among other things, the nominee’s breadth of experience, financial expertise, integrity, ability to make independent analytical inquiries, understanding of our business environment, skills in areas relevant to our growth drivers and willingness to devote adequate time to Board duties — all in the context of the needs of the Board at that point in time, and with the objective of ensuring a diversity of backgrounds, expertise and viewpoints. Our Board also endeavors to include highly qualified women and individuals from historically underrepresented groups in the candidate pool. The composition of our Board at year-end 2023 was:

 

The following table provides summary information about each director nominee. Our Board is currently classified with members of each class serving staggered one or three-year terms. We have three directors in Class I, three directors in Class II and three directors in Class III. Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. AnnaMaria DeSalva, who is currently a Class II director, will not stand for reelection at the 2024 Annual Meeting of Stockholders. Christine Breves and Adrian Kingshott will stand for election as Class II directors at the 2024 Annual Meeting of Stockholders. By 2026, all our directors will stand for election each year for one-year terms, and our board will no longer be divided into three classes.

2023 was our first full year as a standalone public company. Under the skilled leadership of our NEOs, our model delivered outperformance for 2023, despite the extended soft freight market conditions.

 

Our pursuit of continuous improvement is embedded in our daily operations and is at the heart of what we do for our customers and our company. Rooted in innovation, our technology, including our RXO Connect^TM platform and RXO Drive^TM application, efficiently matches the freight needs of shippers with available truckload capacity, reducing empty miles and enabling our customers to reduce their emissions and environmental impact. Our RXO Ship Net-Zero program allows shippers to offset their carbon emissions by investing in the sustainability project of their choice.

We are advancing a collaborative, inclusive, and diverse culture that embraces and empowers our talent.

We foster an environment that focuses on physical and emotional safety at work, with strong ethical guidelines that clearly define prohibited behavior and promote inclusivity. Our differences as people give us a competitive advantage and make our workplace stronger. We promote transparency and reinforce the importance of our culture through open-door management, surveys, training, and our internal social media network.

We are committed to acting and operating with high standards of ethics and compliance. We promote integrity and transparency and prioritize creating a safe space for our employees to speak up, report concerns, and conduct themselves with strong moral principles. Through good governance, fair practices, and an equitable workplace, we earn and maintain the trust of our stockholders, employees, and customers of all backgrounds.

We believe that operating responsibly grows our business, attracts and retains top talent, deepens our customer relationships, and creates a more sustainable and inclusive future for the communities in which we operate. We have a dedicated sustainability committee that meets regularly to discuss how we can achieve results while making a positive impact on our environment.

In our first year as an independent company we have made significant strides in our environmental sustainability initiatives. All RXO business units are SmartWay certified by the U.S. Environmental Protection Agency, and we encourage our contract carriers to join this important program. We continue to grow our electric vehicle (EV) operations, including our Last Mile EV fleet and pilot programs with customers. We also offer customers ESG-related add-ons, including load consolidation, drop trailer services, and customized dashboards that show customers their freight transportation carbon footprint, and biodiesel use.

The following answers address some questions you may have about our Annual Meeting. These questions and answers may not include all the information that may be important to you as a stockholder of our company. Please refer to the more detailed information contained elsewhere in this Proxy Statement.

We expect that the business presented for a vote at the Annual Meeting will be as follows:

Senior management of RXO and representatives of our outside auditor, Deloitte & Touche LLP, will be available to respond to appropriate questions.

You are entitled to receive notice of, virtually attend and vote at the Annual Meeting, or any adjournment or postponement thereof, if, as of the close of business on the Record Date, you were a holder of record of our common stock.

We have designed the virtual Annual Meeting to provide substantially the same opportunities to participate as stockholders would have at an in-person meeting. You can access the Annual Meeting at www.virtualshareholdermeeting.com/RXO2024. You will be required to provide the control number on your proxy card to access the Annual Meeting.

If the shares of common stock you hold are in an account at a broker, dealer, commercial bank, trust company or other nominee (i.e., in “street name”), you must register in advance to participate in the Annual Meeting, to vote electronically and to submit questions during the live webcast of the meeting. To register, you must obtain a legal proxy from the bank, broker or other nominee that holds your shares giving you the right to vote the shares. At the time of the meeting, go to www.virtualshareholdermeeting.com/RXO2024 and enter your control number.

You may vote your shares using any one of the options below.

VOTE BY INTERNET BEFORE THE MEETING - Go to www.proxyvote.com or scan the QR Barcode on the proxy card or notice. Use the Internet to transmit your voting instructions. Vote by 11:59 p.m. Eastern Time on May 19, 2024. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.

VOTE BY INTERNET DURING THE MEETING - Go to www.virtualshareholdermeeting.com/RXO2024. You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.

VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 p.m. Eastern Time on May 19, 2024. Have your proxy card in hand when you call and then follow the instructions.

VOTE BY MAIL - Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

The virtual Annual Meeting format allows stockholders to communicate with RXO during the Annual Meeting so they can ask questions of RXO’s management and Board of Directors, as appropriate. Stockholders (or their proxy holders) may submit questions for the Annual Meeting’s question and answer session in advance by logging on to the meeting website at www.virtualshareholdermeeting.com/RXO2024. You will need the control number on your proxy card in order to submit a question. After you have logged in you will be able to submit your question on the left side of the screen below “ASK A QUESTION”.

Questions can be submitted in advance of the Annual Meeting beginning at 9:45 a.m. Eastern Time on May 20, 2024. Questions may also be submitted during the Annual Meeting through the meeting website. We will answer as many questions during the meeting as time will allow and will group questions together where appropriate. We reserve the right to exclude questions regarding topics that are not pertinent to the Annual Meeting matters or company business or are inappropriate.

The virtual meeting platform is fully supported across browsers (MS Edge, Firefox, Chrome, and Safari) and devices (desktops, laptops, tablets and cell phones) running the most up-to-date version of applicable software and plugins. Note: Internet Explorer is not a supported browser. You should ensure you have a strong Internet connection wherever you intend to participate in the Annual Meeting. We encourage you to access the meeting prior to the start time. If you encounter any technical difficulties logging onto www.virtualshareholdermeeting.com/RXO2024 or during the meeting, there will be a toll- free number and international number available on the website to assist you. Technical support will be available 15 minutes prior to the start time of the meeting and through the conclusion of the meeting.

As of the Record Date, there were 117,542,584 shares of common stock issued and outstanding, with each share entitled to one vote on each matter to come before the Annual Meeting. Therefore, 117,542,584 votes are eligible to be cast at the Annual Meeting.

A quorum is necessary to hold a valid meeting of stockholders. Pursuant to the company’s bylaws, the presence, in person or by proxy, of the holders of a majority of the shares issued and outstanding and entitled to vote is necessary for each of the proposals to be presented at the Annual Meeting. Accordingly, holders of shares of our common stock representing 58,771,143 votes must be present at the Annual Meeting. If you vote by Internet, telephone or proxy card, the shares you vote will be counted toward the quorum for the Annual Meeting. Abstentions and broker non-votes are counted as present for the purpose of determining a quorum.

With respect to Proposal 1, you may vote “FOR” or “AGAINST” each of the director nominees, or you may “ABSTAIN” from voting for one or more of such nominees. With respect to Proposals 2 and 3, you may vote “FOR” or “AGAINST” or you may “ABSTAIN” from voting. If you sign your proxy without giving specific instructions, your shares will be voted in accordance with the recommendations of our Board of Directors with respect to the specific proposals described in this Proxy Statement and at the discretion of the proxy holders on any other matters that properly come before the Annual Meeting.

Brokers may not use discretionary authority to vote shares of our common stock on the election of directors if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, for your vote to be counted in the election of directors, you will need to communicate your voting decisions to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Abstentions and broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the election of director nominees.

Brokers may not use discretionary authority to vote shares of our common stock on the advisory vote to approve executive compensation if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, for your vote to be counted in the advisory vote to approve executive compensation, you will need to communicate your voting decisions to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the advisory vote to approve executive compensation. Abstentions will have the same effect as votes cast “Against” this proposal.

In general, other business properly brought before the Annual Meeting at which a quorum is present requires the affirmative vote of a majority of the shares of common stock present in person or represented by proxy at the Annual Meeting and entitled to vote.

Our Board of Directors, after careful consideration, recommends that our stockholders vote “FOR” the election of each director nominee named in this Proxy Statement, “FOR” the ratification of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal year 2024 and “FOR” the advisory approval of the resolution to approve executive compensation.

We urge you to read this Proxy Statement carefully, then vote via Internet at www.proxyvote.com or by telephone by following the instructions on the proxy card, or mail your completed, dated, and signed proxy card in the enclosed return envelope as soon as possible, so that your shares of our common stock can be voted at the Annual Meeting.

Registered Stockholders. If you are a registered stockholder (i.e., you hold your shares in your own name through our transfer agent, Equiniti Trust Company LLC (formerly American Stock Transfer & Trust Company, LLC), and not through a broker, bank or other nominee that holds shares for your account in “street name”), you may vote by proxy via Internet or by telephone by following the instructions provided on the proxy card, or mail your completed, dated and signed proxy card in the enclosed return envelope. Proxies submitted via Internet or by telephone must be received by 11:59 pm Eastern Time on May 19, 2024. Stockholders of record who attend the Annual Meeting may vote directly at the Annual Meeting by following the instructions provided during the Annual Meeting.

Beneficial Owners. If you are a beneficial owner of shares (i.e., your shares are held in the name of a brokerage firm, bank, or a trustee), you may vote by proxy by following the instructions provided in the voting instruction form or other materials provided to you by the brokerage firm, bank or other nominee that holds your shares. To vote directly at the Annual Meeting, you must obtain a legal proxy from the brokerage firm, bank or other nominee that holds your shares. Follow the instructions provided above to obtain a control number and the voting instructions provided during the Annual Meeting.

If you hold shares as the stockholder of record, your vote by proxy must be received before the polls close at the Annual Meeting. As indicated on the proxy card provided to you, proxies submitted prior to the Annual Meeting via Internet or by telephone must be received by 11:59 pm Eastern Time on May 19, 2024. If you are the beneficial owner of shares of our common stock, please follow the voting instructions provided by your broker, trustee, or other nominee.

If you fail to vote via Internet or by telephone as indicated on your proxy card, or fail to properly sign, date, and return your proxy card, your shares will not be counted towards establishing a quorum for the Annual Meeting, which requires holders representing a majority of the outstanding shares of our common stock to be present in person or by proxy.

Failure to vote, assuming the presence of a quorum, will have no effect on the tabulation of the votes on the proposals. If you are a stockholder of record and you properly sign, date and return your proxy card, but do not indicate your voting preference, we will count your proxy as a vote “FOR” the election of the two nominees for director named in “Proposal 1 — Election of Directors,” “FOR” the ratification of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal year 2024 and “FOR” the advisory approval of the resolution to approve executive compensation.

You should instruct your broker or other nominee on how to vote your shares of our common stock using the instructions they provide to you. Brokers or other nominees who hold shares of our common stock in “street name” for customers are prevented by the rules set forth in the Listed Company Manual of the New York Stock Exchange from exercising voting

discretion with respect to non-routine or contested matters (i.e., they must receive specific voting instructions from a stockholder in order to vote that stockholder’s shares on non-routine or contested matters). Shares not voted by a broker or other nominee, because they did not receive specific voting instructions from the stockholder on one or more proposals, are referred to as “broker non-votes.”

We expect that when the NYSE determines whether each of the proposals to be voted on at our Annual Meeting is a routine or non-routine matter, only “Proposal 2 — Ratification of the Appointment of Deloitte & Touche LLP as Our Independent Registered Public Accounting Firm for Fiscal Year 2024” will be determined to be routine. It is important that you instruct your broker or other nominee on how to vote your shares of our common stock held in “street name” by following the instructions provided to you by your broker or other nominee.

Whether you attend the Annual Meeting or not, you may revoke a proxy at any time before your proxy is voted at the Annual Meeting. You may do so by properly delivering a later-dated proxy either via Internet, by telephone, by mail, or by attending the Annual Meeting virtually and voting. Please note, however, that your attendance at the Annual Meeting will not automatically revoke any prior proxy, unless you vote again at the Annual Meeting or specifically request in writing that your prior proxy be revoked. You also may revoke your proxy by delivering a notice of revocation to Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277 prior to the vote at the Annual Meeting. If you hold your shares through a broker, dealer, commercial bank, trust company or other nominee, you should follow the instructions of your broker or other nominee regarding revocation of proxies.

If you are a registered stockholder (i.e., if you hold your shares of our common stock in your own name through our transfer agent Equiniti Trust Company LLC, and not through a broker, bank or other nominee that holds shares for your account in “street name”) and you complete and submit a proxy, the persons named as proxies will follow your instructions. If you submit a proxy but do not provide voting instructions, or if your instructions are unclear, the persons named as proxies will vote as recommended by our Board of Directors or, if no recommendation is given, by using their own discretion.

We intend to announce preliminary voting results at the Annual Meeting and will publish final results on a Current Report on Form 8-K to be filed with the U.S. Securities and Exchange Commission within four business days after the Annual Meeting. The Form 8-K will also be available on our website, investors.rxo.com.

In cases where multiple company stockholders share the same address, and the shares are held through a bank, broker, or other holder of record in a street-name account, only one copy of our proxy materials will be delivered to that address unless a stockholder at that address requests otherwise. This practice, known as “householding,” is intended to reduce our printing and postage costs. However, any street-name stockholders residing at the same address who wish to receive a separate copy of our proxy materials may request a copy by contacting their bank, broker or other holder of record, or by

sending a written request to Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277, or by contacting Investor Relations by email at investors@rxo.com. The voting instruction form sent to a street-name stockholder should provide information on how to request a separate copy of future materials for each company stockholder at that address, if that is your preference. Similarly, if you currently receive separate copies of our proxy materials but wish to participate in householding, please contact us through the method described above.

Yes, this Proxy Statement and our 2023 Annual Report are available at investors.rxo.com.

RXO, Inc. is a high-performing asset-light transportation platform defined by cutting-edge technology. The business is comprised of a core North American truck brokerage business and complementary services.

Within our brokerage business, shippers create demand for our service, and we place their freight with qualified independent carriers using our proprietary technology. As of December 31, 2023 we had approximately 115,000 carriers in our North American truck brokerage network, and access to more than 1.4 million trucks.

Our managed transportation service provides asset-light solutions for shippers who outsource their freight transportation to gain reliability, visibility and cost savings. The service uses proprietary technology to enhance our revenue synergy, with cross-selling to truck brokerage, last mile and freight forwarding. Our managed transportation offering includes bespoke load planning and procurement, complex solutions tailored to specific challenges, performance monitoring, engineering and data analytics, among other services. Our control tower solution leverages the expertise of a dedicated team focused on continuous improvement, and digital, door-to-door visibility into order status and freight in transit. In addition, we offer technology-enabled managed expedite services that automate transportation procurement for time-critical freight moved by road and air charter carriers.

Our last mile offering is an asset-light service that facilitates consumer deliveries performed by highly qualified third- party contractors. We are the largest provider of outsourced last mile transportation for heavy goods in the United States, positioned within 125 miles of the vast majority of the U.S. population and serving a customer base of omnichannel and e-commerce retailers and direct-to-consumer manufacturers.

Our freight forwarding service is a scalable, asset-light offering managed with advanced technology that facilitates ocean, road and air transportation and assists with customs brokerage. We are a U.S. based freight forwarder with a global network of company-owned and partner-owned locations and coverage of key trade lanes that reach approximately 150 countries and territories.

Our strategy is designed to deliver value through our extensive carrier relationships, automated shipper-carrier interactions, end-to-end digital tracking and data analyses generated by our proprietary algorithms. Our services are both highly responsive to customer needs and proactive in identifying potential improvements. Furthermore, we have instilled a culture that defines success as mutually beneficial results for our stockholders and other stakeholders.

Management’s growth and optimization strategy is to:

Our Board of Directors consists of a highly skilled group of leaders who share our values and reflect our culture. Many of our directors have served as executive officers or board members of major companies and have an extensive understanding of the principles of corporate governance. Our Board as a whole has extensive expertise in the following areas, all of which are relevant to our company, business, industry and strategy.

Our Board of Directors currently consists of nine members. Our amended and restated certificate of incorporation provides for a classified board of directors, with members of each class serving staggered three-year terms. We have three directors in Class I, three directors in Class II and three directors in Class III. Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. By 2026, all our directors will stand for election each year for one-year terms, and our board will no longer be divided into three classes. AnnaMaria DeSalva, who is currently a Class II director, will not stand for reelection at the 2024 Annual Meeting of Stockholders. Christine Breves and Adrian Kingshott will stand for election as Class II directors at the 2024 Annual Meeting of Stockholders. The terms of directors in Classes I, II and III end at the annual meetings in 2024, 2025 and 2026, as indicated below.

Set forth below is information regarding each of our continuing directors and director nominees, including the experience, qualifications, attributes, or skills that led our Board to conclude that each should serve as a director.

Our business and affairs are managed under the direction of our Board of Directors, which is our company’s ultimate decision-making body, except with respect to those matters reserved to our stockholders. Our Board’s primary responsibility is to seek to maximize long-term stockholder value. Our Board establishes our overall corporate policies, selects and evaluates our senior management team, which is charged with the conduct of our business, monitors the performance of our company and management, and provides advice and counsel to management. In fulfilling the Board’s responsibilities, our directors have full access to our management, internal and external auditors, and outside advisors.

Furthermore, our Board of Directors is committed to independent Board oversight. Our current Board leadership structure includes a non-executive chairman as well as a vice chair and a lead independent director. The position of chairman of the Board is held by Mr. Jacobs.

To further strengthen its independent decision-making, our Board has approved a set of Corporate Governance Guidelines that provide for an independent vice chair position as part of its ongoing commitment to strong corporate governance. The position of vice chair is defined as an independent director with authorities and duties that include: (i) presiding at meetings of the Board where the chairman and lead independent director are not present; (ii) assisting the chairman, when appropriate, in carrying out his duties; (iii) assisting the lead independent director, where appropriate, in carrying out her duties; and (iv) such other duties, responsibilities and assistance as the Board or the chairman may determine. The vice chair is also available to meet with significant stockholders as required. Ms. Kissel was appointed to serve as vice chair on November 1, 2022.

In addition, the Board has provided that the independent directors may appoint a lead independent director who presides over executive sessions of the independent directors, and who shall serve a term of at least one year. The position of lead independent director has been structured to include, among other duties: (i) presiding at all meetings of the Board of Directors at which the chairman is not present; (ii) presiding at all executive sessions of the independent directors, which must take place at least once a year without members of management present; and (iii) calling additional meetings of the independent directors as necessary. The lead independent director also serves as a liaison between the chairman and the independent directors. Ms. Nettles was appointed to serve as lead independent director on November 1, 2022.

Further information regarding the positions of lead independent director and vice chairman is set forth in the Corporate Governance Guidelines, which are available on the company’s website at www.rxo.com under the Investors tab.

Our Board of Directors held five meetings during 2023. All nine persons currently serving as directors attended all our board meetings. Each person currently serving as a director attended all the meetings of the committee(s) on which he or she served during the time he or she served on the Board or committees. During 2023, our Board of Directors took one action via unanimous written consent.

Our directors are expected to attend our annual meetings. Any director who is unable to attend is expected to notify the chairman of the Board in advance of the meeting date. All our directors attended our first Annual Meeting of Stockholders in 2023.

Our Board of Directors provides overall risk oversight, with a focus on the most significant risks facing our company.

In addition, the Board is responsible for ensuring appropriate crisis management and business continuity plans are in place. The management of risks to our business, and the execution of contingency plans, are primarily the responsibility of our senior management team.

Our Board and senior management team regularly discuss the company’s business strategy, operations, policies, controls, prospects, and current and potential risks. These discussions include approaches for assessing, monitoring, mitigating, and controlling risk exposure. The Board has delegated responsibility for the oversight of specific risks to its committees as follows.

In addition, the Board periodically holds special sessions to evaluate topical trends identified as significant risks or items of strategic interest. The Board is committed to ensuring that our company has the resources and infrastructure necessary to appropriately address all significant risks.

Each of the Audit Committee, the Compensation Committee and the Nominating, Governance and Sustainability Committee has a written charter that complies with applicable SEC rules and with the rules set forth in the NYSE Listed Company Manual. These charters are available at investors.rxo.com. You may obtain a printed copy of any of these charters, without charge, by sending a request to Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277.

The Audit Committee, the Compensation Committee and the Nominating, Governance and Sustainability Committee are each composed entirely of independent directors within all applicable standards, as discussed below. Our Board’s general policy is to review and approve committee assignments annually. After consulting with our Board chairman and considering member qualifications, the Nominating, Governance and Sustainability Committee is responsible for recommending to our Board all committee assignments, including the roles of committee chair. Each committee is authorized to retain, in its sole authority, its own outside counsel and other advisors at the company’s expense. Also, each committee may form and delegate authority to subcommittees when appropriate. Our Board may create or eliminate additional committees as it deems appropriate. All directors are invited to attend committee meetings even if they are not a member of the committee.

The following table sets forth the membership of each of our Board committees as of the Record Date. Mr. Jacobs and Mr. Wilkerson do not serve on any Board committees.

A summary of the committees’ responsibilities is as follows:

Audit Committee. Our Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) to assist our Board of Directors in fulfilling its responsibilities in a number of areas, including, without limitation, oversight of: (i) our accounting and financial reporting processes, including our systems of internal controls and disclosure controls, (ii) the integrity of our financial statements, (iii) our compliance with legal and regulatory requirements, (iv) the qualifications and independence of our independent registered public accounting firm, (v) the performance of our independent registered public accounting firm and internal audit function, and (vi) related party transactions. Each member of the Audit Committee satisfies all applicable independence standards, has not participated in the preparation of our financial statements at any time during the past three years, and is able to read and understand fundamental financial statements. During 2023, the Audit Committee members were Thomas Szlosek (chairman), Christine Breves and Adrian Kingshott. During 2023, the Audit Committee met five times and took one action via unanimous written consent. Our Board has determined that Mr. Szlosek qualifies as an “audit committee financial expert” as defined under Item 407(d)(5) of Regulation S-K under the Exchange Act.

Compensation Committee. The primary responsibilities of the Compensation Committee are, among other things: (i) to oversee the administration of our compensation programs, (ii) to review and approve the compensation of our executive management, (iii) to review and make recommendations concerning director compensation, (iv) to prepare any report on executive compensation required by SEC rules and regulations, and (v) to retain independent compensation consultants and oversee the work of such consultants. During 2023, the Compensation Committee members were Michelle Nettles (chairman), Mary Kissel and Stephen Renna. During 2023, the Compensation Committee met five times and did not take any actions via unanimous written consent.

Nominating, Governance and Sustainability Committee. The primary responsibilities of the Nominating, Governance and Sustainability Committee are, among other things: (i) to identify individuals qualified to become directors and recommend that our board select such individuals to be presented for stockholder consideration at the annual meeting or to be appointed by the board to fill a vacancy, (ii) to make recommendations to our board concerning committee appointments, (iii) to develop, recommend to our board and annually review the Corporate Governance Guidelines and oversee corporate governance matters, (iv) to oversee an annual evaluation of our board and committees, and (v) to support our board in its oversight of our sustainability strategies, performance and external disclosures. During 2023, the Nominating, Governance and Sustainability Committee members were AnnaMaria DeSalva (chairman), Adrian Kingshott and Stephen Renna. During 2023 the Nominating, Governance and Sustainability Committee met two times and did not take any actions via unanimous written consent.

The following table sets forth information concerning the compensation of each person who served as a non-employee director of our company during 2023.

Our non-employee director compensation policy provides for an annual cash retainer of $80,000, payable quarterly in arrears, and time-based restricted stock units (“Time-Based RSUs”) worth $190,000. The annual grant of such Time-Based RSUs is to be made on the first business day of each calendar year of service (the “RSU Grant Date”) with the number of units determined by dividing $190,000 by the average of the closing prices of the company’s common stock on the 10 trading days immediately preceding the RSU Grant Date.

The vice chair of the Board receives an additional $25,000 annual cash retainer, payable quarterly in arrears; the lead independent director receives an additional $25,000 annual cash retainer, payable quarterly in arrears; and the chairs of our Audit Committee, our Compensation Committee and our Nominating, Corporate Governance and Sustainability Committee each receives an additional cash retainer of $25,000, $20,000 and $20,000, respectively, payable quarterly in arrears.

Directors who are employees of our company do not receive additional compensation for service as members of either our Board of Directors or its committees. Changes to the compensation of our directors is subject to approval by our Board, based in part on the recommendation of the Compensation Committee.

No other fees are paid to our directors for their attendance at or participation in meetings of our Board or its committees. We reimburse our directors for expenses incurred in the performance of their duties, including reimbursement for air travel and hotel expenses.

None of the members of our Compensation Committee has been an officer or employee of our company. During 2023, there were no material transactions between the company and the members of the Compensation Committee, and none of our executive officers served on any compensation committee or board of directors of any entity that has one or more executive officers serving on our Compensation Committee or on our Board of Directors.

Our Board of Directors is committed to sound corporate governance principles and practices. Our Board adopted Corporate Governance Guidelines as of November 1, 2022.

The Guidelines serve as a framework within which our Board operates. Among other things, the Guidelines include criteria for determining the qualifications and independence of the members of our Board, requirements for the standing committees of our Board, responsibilities for members of our Board and requirements to conduct an annual evaluation of the effectiveness of our Board and its committees. The Nominating, Governance and Sustainability Committee is responsible for reviewing the Guidelines annually, or more frequently as appropriate, and recommending appropriate changes to our Board in light of applicable laws and regulations, the governance standards identified by leading governance authorities and our company’s evolving needs.

We have a Code of Business Ethics that applies to our directors and executive officers. This Code is designed to deter wrongdoing, promote the honest and ethical conduct of all employees, and promote compliance with applicable governmental laws, rules and regulations, as well as provide clear channels for reporting concerns. The Code of Business Ethics constitutes a “code of ethics” as defined in Item 406(b) of Regulation S-K. We intend to satisfy the disclosure requirements under applicable SEC rules relating to amendments to the Code of Business Ethics or waivers of any provision of the Code of Business Ethics as applicable to our principal executive officer, our principal financial officer, and our principal accounting officer by posting such disclosures on our website pursuant to SEC rules.

The Guidelines and the Code of Business Ethics are available on our website at www.rxo.com. In addition, you may obtain a printed copy of these documents, without charge, by sending a request to: Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277.

Under the Corporate Governance Guidelines, our Board of Directors is responsible for making independence determinations annually with the assistance of the Nominating, Governance and Sustainability Committee. Independence determinations are made by reference to the independence standard under the Corporate Governance Guidelines and the definition of “independent director” under Section 303A.02 of the NYSE Listed Company Manual. Our Board has affirmatively determined that each person who served as a director during any part of 2023 (including members of the Nominating, Governance and Sustainability Committee), except for Mr. Jacobs and Mr. Wilkerson, satisfies the independence standards under the Guidelines and the NYSE Listed Company Manual.

In addition to the independence standards provided in the Guidelines, our Board has determined that each director who serves on our Audit Committee satisfies standards for independence of Audit Committee members established by the SEC: that is, the director may not (i) accept directly or indirectly any consulting, advisory or other compensatory fee from our company other than his or her director compensation or (ii) be an affiliated person of our company or any of its subsidiaries. Our Board has also determined that each member of the Compensation Committee satisfies the NYSE standards for independence of Compensation Committee members. In making the independence determinations for each director, our Board and the Nominating, Governance and Sustainability Committee analyzed certain relationships of the directors that were not required to be disclosed pursuant to Item 404(a) of Regulation S-K.

The Nominating, Governance and Sustainability Committee is responsible for recommending to our Board all nominees for election to the Board, including nominees for re-election to the Board, in each case, after consultation with the chairman of the Board. Subject to the foregoing, in considering new nominees for election to our Board, the Nominating, Governance and Sustainability Committee considers, among other things, breadth of experience, financial expertise, wisdom, integrity, an ability to make independent analytical inquiries, an understanding of our company’s business environment, knowledge and experience in such areas as technology and marketing, and other disciplines relevant to our company’s businesses, the nominee’s ownership interest in our company, and a willingness and ability to devote adequate time to board duties, all in the context of the needs of the Board at that point in time and with the objective of ensuring diversity in the background, experience and viewpoints of Board members. When searching for new directors, our Board endeavors to actively seek out highly qualified women and individuals from underrepresented minorities to include in the pool from which Board nominees are chosen. Our Board aims to create a team of directors with diverse experiences and perspectives to provide our company with thoughtful and engaged Board oversight. The Nominating, Governance and Sustainability Committee assesses the effectiveness of its diversity efforts through periodic evaluations of the Board’s composition.

The Nominating, Governance and Sustainability Committee may identify potential nominees for election to our Board from a variety of sources, including recommendations from current directors or management, recommendations from our stockholders or any other source the committee deems appropriate, including engaging a third-party consulting firm to assist in identifying independent director nominees.

Our Board will consider nominees submitted by our stockholders, subject to the same factors that are brought to bear when it considers nominees referred by other sources. Our stockholders will be permitted to nominate candidates for election as directors by following the procedures set forth in our amended and restated bylaws, which are summarized below. We did not receive any director nominees from our stockholders for the 2024 Annual Meeting.

The advance notice provisions of our bylaws require that a stockholder who wishes to nominate an individual for election as a director at our annual meeting must give us advance written notice. The notice must be delivered to or mailed and received by the secretary of our company not less than 90 days, and not more than 120 days, prior to the first anniversary of the preceding year’s annual meeting. As more specifically provided in our bylaws, any nomination must include, among other things: (i) the nominator’s name and address and the number of shares of each class of our capital stock that the nominator owns, (ii) the name and address of any person with whom the nominator is acting in concert and the number of shares of each class of our capital stock that any such person owns, and (iii) the information with respect to each such proposed director nominee that would be required to be provided in a proxy statement prepared in accordance with applicable SEC rules.

In addition, the proxy access provisions of our bylaws permit a stockholder, or a group of up to 20 stockholders, that has continuously owned for three years at least 3% of our outstanding common stock, to nominate and include in the our annual meeting proxy materials up to the greater of two directors or 20% of the number of directors to be elected at the annual meeting, provided that the stockholder(s) and the nominee(s) satisfy the requirements specified in our bylaws. Stockholder requests to include stockholder-nominated directors in the company’s proxy materials for our 2025 Annual Meeting of stockholders must be received by the company no earlier than November 10, 2024 and no later than December 10, 2024.

Any stockholder who wishes to nominate a potential director candidate must follow the specific requirements set forth in our bylaws, a copy of which may be obtained by sending a request to: Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277.

At RXO, our values are central to our foundation which enables our competitive advantage and ability to consistently deliver for everyone we serve. Grounded in our passion for technology and solutions, we approach our work with an entrepreneurial spirit that encourages creative problem solving and allows us to adapt quickly to changes. We maintain a strong governance structure, a strict code of ethics, good corporate citizenship, and a commitment to consistent employee engagement.

RXO management and our Board of Directors believe that human capital management is a strength at our company. We are committed to working together in a transparent manner, allowing for open communication for all human resource-related matters, and striving to maintain our position as an employer of choice. Our Board has access to information about our human resources operations, talent development programs, succession planning and long-range business plans. Our Chief Human Resources Officer is invited to speak regularly at Board meetings, and our Compensation Committee actively reviews our benefit offerings and makes executive and broad-based employee compensation decisions. We conduct in-person and virtual meetings directly with our Board, and the directors often attend and participate in the monthly operating review meetings with the leadership of our businesses.

As a customer-centric company with a strong service culture, we require an unwavering commitment to workplace inclusion and safety, as well as competitive total compensation that meets the needs of our employees and their families. We listen to our employees, we ask for feedback through engagement surveys, leadership roundtables, site assessments, and town halls. We use these opportunities to gauge what is important to our employees and gather constructive suggestions on the areas we can improve. Throughout 2023, we made significant investments to our employees, particularly in the following areas.

 In 2023 we worked to expand our community engagement efforts, which included a partnership with Veterans Bridge Home, USO, Kids in Need Foundation, Wreaths Across America, Women In Trucking, Dress for Success, and various breast cancer survivor organizations that have supported our employees through their cancer journeys. RXO was recognized as a Military Friendly Employer and named as A Top Company for Women to Work for by Women in Trucking.

 We continue to prioritize employees’ physical and mental health, remaining diligent in upholding RXO’s safety protocols, a contactless delivery policy for our drivers and customers, and access to mental health counseling services for employees and their dependents. Another way we work to decrease occupational injuries and illnesses is through our global Road to Zero program. Road to Zero instills safety and compliance awareness through education, mentoring, communication, and on-the-job training. In 2023, RXO maintained an Occupational Safety and Health Administration total recordable incident rate that was lower than the national benchmark for the Truck Transportation industry, based on the “Industry Injury and Illness Data” of the U.S. Bureau of Labor Statistics.

Through innovation and purpose, we work to promote environmental, social, and organizational sustainability. By its nature, our business model, which matches freight needs with available capacity, supports sustainability. By growing our business responsibly, we can improve environmental outcomes for the transportation industry while increasing stockholder value. Sustainability is at the forefront of deliberations among our directors and informs their overall approach to risk oversight. It fosters an inclusive workplace for our employees, both now and in the future.

In addition, ESG efforts are important to many of our stakeholders who want to do business with partners who share their goals, such as the transition to a low-carbon economy.

We continue to work closely with the Nominating, Governance and Sustainability Committee on our Company’s external disclosures regarding material sustainability and other corporate responsibility matters.

Information technology and cybersecurity risks are top priority for our company, and we take a proactive approach to managing these risks by closely monitoring and overseeing these areas.

Our Board receives regular updates from management regarding governance processes, ongoing projects to improve cybersecurity defense, and the results of simulated security tests. They also discuss relevant incidents in the industry and changes in the threat landscape.

We have a dedicated cybersecurity team, led by our chief information security officer, that stays up to date on the latest industry trends, regulations, and technological developments and enhances our information security capabilities to protect against threats. Our cybersecurity infrastructure and defense mechanisms effectively block a high volume of threats each month.

We are committed to continually improve our ability to detect and respond to incidents and have an IT security training program that all employees are required to complete at regular intervals. We also have phishing simulation programs and an information security insurance policy.

Stockholders and other parties interested in communicating with our Board of Directors, any Board committee, any individual director, including our lead independent director, or any group of directors (such as our independent directors) should send written correspondence to Board of Directors, c/o Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277. Please note that we will not forward communications to the Board that qualify as spam, junk mail, mass mailings, resumes or other forms of job inquiries, surveys, business solicitations or advertisements.

Stockholder proposals intended to be presented at our 2025 Annual Meeting of Stockholders must be received by our Corporate Secretary no later than December 10 2024, in order to be considered for inclusion in our proxy materials, pursuant to Rule 14a-8 under the Exchange Act.

As more specifically provided for in our bylaws, no business may be brought before an annual meeting of our stockholders unless it is specified in the notice of the annual meeting or is otherwise brought before the annual meeting by or at the direction of our Board of Directors or by a stockholder entitled to vote and who has delivered proper notice to us not less than 90 days, and not more than 120 days, prior to the earlier of the date of the annual meeting and the first anniversary of the preceding year’s annual meeting. For example, if our 2025 Annual Meeting is held on May 20, 2025, any stockholder proposal to be considered at the 2025 Annual Meeting, including nominations of persons for election to our Board, must be properly submitted to us not earlier than January 20, 2025, nor later than February 19, 2025. Additionally, to comply with the SEC’s universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than our nominees must provide written notice to us that includes the information required by Rule 14a-19(b) under the Exchange Act not later than February 19, 2025.

Detailed information for submitting stockholder proposals or nominations of director candidates will be provided upon written request sent to: Jeffrey Firestone, Corporate Secretary, RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277.

Under its written charter, the Audit Committee of our Board of Directors is responsible for reviewing and approving or ratifying any transaction between our company and a related person (as defined in Item 404 of Regulation S-K) that is required to be disclosed under the rules and regulations of the SEC. Our management is responsible for bringing any such transaction to the attention of the Audit Committee. In approving or rejecting any such transaction, the Audit Committee considers the relevant facts and circumstances, including the material terms of the transaction, risks, benefits, costs, availability of other comparable services or products and, if applicable, the impact on a director’s independence.

RXO entered into the Registration Rights Agreement with Jacobs Private Equity, LLC (“JPE”), an affiliate of Brad Jacobs, our chairman. The Registration Rights Agreement provides certain holders of shares of RXO common stock with certain rights to cause RXO to register the sale of their common stock, other than any such securities that are then freely transferable without registration pursuant to Rule 144 under the Securities Act, without limitation as to volume, manner of sale or other restrictions under Rule 144. Pursuant to the Registration Rights Agreement, JPE may request that we register shares of our common stock held by JPE a total of three times. If such registration involves an underwritten offering, we may be required to agree to be restricted from selling or disposing any of our common stock or securities convertible into or exchangeable or exercisable for common stock for a period of 90 days (subject to certain exceptions and our ability to defer a registration request or suspend use of a registration statement under certain circumstances).

In addition, subject to certain exceptions, if we register our securities on a registration statement that permits the inclusion of shares of our common stock held by JPE, we must give JPE prompt written notice and include on such registration statement all shares requested to be included. The Registration Rights Agreement also contains customary provisions relating to expenses and indemnification.

As of March 25, 2024, JPE beneficially owned 1,300,701 shares of RXO common stock, which represents approximately 1.1% of the outstanding shares of RXO common stock.

Section 16(a) of the Securities Exchange Act of 1934 requires that RXO’s directors, executive officers and persons who beneficially own 10% or more of RXO’s common stock file with the SEC initial reports of ownership and reports of changes in ownership of our stock and our other equity securities. To RXO’s knowledge, based solely on a review of the copies of such reports furnished to RXO and written representations that no other reports were required, during the year ended December 31, 2023, all such filing requirements applicable to RXO’s directors, executive officers and greater than 10% beneficial owners were complied with.

The following table sets forth information concerning the beneficial ownership of our voting securities as of the Record Date by: (i) each person who is known by us, based solely on a review of public filings, to be the beneficial owner of more than 5% of any class of our outstanding voting securities, (ii) each director, (iii) each NEO, and (iv) all executive officers and directors as a group. None of the foregoing persons beneficially owned any shares of equity securities of our subsidiaries as of the Record Date.

Under applicable SEC rules, a person is deemed to be the “beneficial owner” of a voting security if such person has (or shares) either investment power or voting power over such security or has (or shares) the right to acquire such security within 60 days by any of a number of means, including upon the exercise of options or warrants or the conversion of convertible securities. A beneficial owner’s percentage ownership is determined by assuming that options, warrants and convertible securities that are held solely by the beneficial owner, and which are exercisable or convertible within 60 days, have been exercised or converted. Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to all voting securities shown as being owned by them. Unless otherwise indicated, the address of each beneficial owner in the table below is care of RXO, Inc., 11215 North Community House Road, Charlotte, North Carolina 28277.

This Compensation Discussion and Analysis describes RXO’s executive compensation program for 2023. The Compensation Committee oversees our executive compensation program and practices. In this section, we explain the compensation decisions for the following named executive officers (also called “NEOs”), who were our only executive officers during 2023.

RXO completed the spin-off from XPO Logistics, Inc. on November 1, 2022. For RXO, 2023 represented the first full fiscal year as a standalone company since its spin-off. During that time, the compensation committee of the board of directors assessed and implemented a compensation philosophy and incentive plan design that tied the objectives of the company and its pay-for-performance philosophy. This is described in greater detail throughout this compensation discussion and analysis.

2023 was a historic year for RXO, our first full year as a standalone public company. We doubled down on our strengths, deepened our customer relationships, and created solutions that helped our customers solve their toughest transportation challenges while strategically investing in our business. Our business model outperformed for 2023 despite the extended soft freight market conditions. We grew brokerage volumes by 12% year-over-year with a strong brokerage gross margin.

Highlights of our 2023 performance include:

RXO benefits from many strong secular tailwinds, including outsourcing freight transportation, increased brokerage penetration of for-hire truckload transportation, and adoption of digital brokerage technologies by shippers and carriers. Given our size in the transportation industry, we see a significant opportunity to increase our market share through ongoing shipper and carrier adoption of our proprietary RXO Connect™ platform. Our late-stage pipeline remains strong and in the fourth quarter of 2023, it grew by 90% when compared to the same period in 2021. We are increasing our share of wallet with existing customers and adding new customers.

The growing complexity of supply chains, the advent of brokerage technology, and the increasing risk-aversion of supply chain operators caused shippers to seek out large, third-party transportation partners with on-demand access to trucks and drivers, real-time pricing, and continuous visibility into the movement of their goods. This led to a sustained shift toward utilizing outsourced transportation brokers such as RXO that have a sophisticated technology offering and provide data for astute decision-making. Broker penetration of for-hire truckload transportation doubled in the last 15 years, and yet, remains less than 25% of the market. Our brokerage business is positioned to benefit from this trend supported by a new volume record in the fourth quarter of 2023.

RXO is well-positioned to capitalize on the growth opportunity ahead of us. We have a playbook for every market cycle, momentum towards increasing share in a $750 billion market, an accomplished leadership team, and a winning strategy.

RXO’s compensation philosophy underpins our compensation programs which are designed to attract and retain talent, drive sustainable stockholder value, and ensure the responsible practices of Company leadership. The Compensation Committee believes this is accomplished by linking pay with individual and business performance, balancing short- and long-term business goals, rewarding growth, and offering competitive pay that retains high-performing leaders.

The compensation philosophy is guided by the following objectives:

The Compensation Committee assesses the performance of the executive officers and ensures that the compensation pay mix of the leaders is competitive and meets its objective to attract and retain the Company’s top talent and to maximize stockholder value.

We established and continue to promote a compensation governance framework that the Compensation Committee and RXO leadership believe aligns and reinforces the company’s compensation philosophy.

We believe that regular stockholder engagement is key to strong corporate governance, and we recognize the value of engaging in constructive dialogue with stockholders on numerous topics, including business strategy, governance, executive compensation, corporate sustainability, and other important matters. We strive to continually improve in these areas, and we value the opportunity to hold ongoing engagement discussions with stockholders throughout the year. Our investor relations team engages regularly with both existing and prospective stockholders. Feedback from these sessions is shared with executive management and reflected in our strategic priorities.

The Compensation Committee believes in a balanced approach between evaluating individual and company performance results against formulaic programs to ensure maximum alignment with stockholder interests. The decision-making process incorporates an element of discretion, allowing the Committee to utilize a balanced, multi-dimensional approach to NEO compensation that includes reviewing performance against goals.

The Committee has oversight in ensuring the executive compensation is effective and reasonable. To form a multi-dimensional view of executive compensation, the Committee balances the company’s progress against objectives with insights from several sources. Influential factors in determining executive compensation include:

The Compensation Committee adopted, with advice from its independent consultant, a peer group to assist in measuring appropriate levels of compensation for fiscal year 2023. The compensation peer group comprises companies with similar or adjacent business models that source talent from the same labor pools as RXO. In determining the peer group, the Committee used the following criteria: (i) company is operating within the trucking, air freight or logistics industry and is competitive with RXO, (ii) company is publicly traded on a major U.S. stock exchange, and (iii) company is within a reasonable size range of RXO, with certain companies falling outside of that range based on industry relevance.

Our executive compensation program includes three primary elements: base salary, annual short-term incentive (STI) awards, and long-term incentive (LTI) awards. These elements are described in more detail below.

On an annual basis, the Compensation Committee reviews base salaries relative to market benchmarks and may make periodic adjustments. For 2023, the Committee did not make any salary adjustments to the base salaries for our NEOs. The following annual base salaries were in effect as of the spin-off and remained unchanged for 2023:

On an annual basis, the Compensation Committee reviews market and peer data to determine the short- term incentive (STI) target opportunity for our NEOs, as shown in the table below.

For the 2023 performance year, each NEO was eligible for STI if Adjusted EBITDA (which is a non-GAAP metric further described in Annex A) was above 80% of target and remained employed as of the payment date. The maximum annual STI payout opportunity is capped at 200% of target. Our NEOs participated in the STI with funding determined 100% on the adjusted EBITDA performance of RXO for 2023.

2023 STI Payout. In consideration of the above factors, each of Mr. Wilkerson, Mr. Harris, and Mr. Firestone did not receive a short-term incentive payout based on the financial performance results.

Below is a summary of our NEOs’ total annual STI compensation for 2023 final outcomes.

Our long-term incentive (LTI) program is designed to motivate our executives to achieve business goals, retain executive talent, and reward performance over an extended period by tying a significant portion of compensation to stockholder returns through the use of equity awards.

2023 Long-Term Incentive Grants. In February 2023, the Compensation Committee, along with guidance from their independent advisor, awarded time-based restricted stock units (RSUs) to each NEO which vest one-third on each of the first three anniversaries of the grant date. The award and grant date values are further described in the summary compensation and related tables.¹

As a short-tenured standalone company following the spin-off from XPO Logistics, Inc. on November 1, 2022, the Compensation Committee elected to grant time-based RSUs for the purpose of having a measured amount of time to assess the appropriate performance metrics that would impact company results, enhance the interests of shareholders, and drive executive performance and retention.

2024 Long-Term Incentive Design. The 2024 design aligns our executive compensation package with the Company’s compensation philosophy, further links pay with performance, and builds sustainable shareholder value while driving our long-term strategic priorities.

Beginning with LTI grants awarded in 2024, the primary equity awards for delivering long-term incentives are the combination of time-based restricted stock units (RSUs) and performance-based restricted stock units (PRSUs). The Compensation Committee believes that placing more pay at risk balances the interests of motivating performance toward shareholder return and retaining executive talent.

The long-term incentive stock award mix for 2024 consists of the following components:

The performance-based restricted stock units are based 100% on relative total shareholder return as compared to the S&P Transportation Select Industry Index. The payout scale has a threshold starting at the 55th percentile and a maximum achievement at the 90th percentile, with a 0% payout below the 55th percentile.

We believe that NEOs and the Board of Directors should have a significant stake in RXO. The stock ownership guidelines we have adopted are designed to encourage long-term focus on performance, align the interests of its executives and directors with those of its stockholders, and mitigate a number of risks, including those related to attrition and undue risk-taking.

Stock ownership guidelines are expressed as a multiple of annual base salary (NEOs) or annual cash retainer (directors) in the form of RXO stock, as follows:

Compliance with our stock ownership guidelines is generally determined using the aggregate count of shares of common stock held directly or indirectly by the covered individuals, plus unvested restricted stock units subject solely to time-based vesting and, for directors, vested restricted stock units subject to deferred delivery. Stock options, whether vested or unvested, and equity-based awards subject to performance-based vesting conditions, are not counted toward meeting stock ownership guidelines until they have settled or been exercised, as applicable. Covered individuals have five years to come into compliance with the guidelines from the date they start in the position that is subject to ownership requirements or join the Board.

As of the Record Date, each covered individual complied, or was on the way to complying, within the five years with our stock ownership guidelines.

RXO has adopted a clawback policy (“Policy”) for the recoupment of incentive-based compensation for the NEOs. The policy applies in the event of any accounting restatement due to the Company’s material noncompliance with financial reporting requirements in accordance with Rule 10D-1 of the Securities Exchange Act of 1934 and with New York Stock Exchange listing requirements. The NEOs are covered and subject to this Policy, even if an executive officer had no responsibility for the financial statement errors that required restatement.

This Policy covers all incentive-based compensation (including any cash or equity compensation) that is granted, earned or vested based wholly or in part upon the attainment of any financial reporting measure. It applies to any incentive-based compensation received by an executive officer during the period consisting of any of the three completed fiscal years immediately preceding the date that the Company’s Board (or its Audit Committee) concludes, or reasonably should have concluded, that the Company is required to prepare a restatement or the date that a court, regulator, or other legally authorized body directs the Company to prepare a restatement.

Additional clawback provisions apply to the CEO and CFO as required by Section 304 of the Sarbanes-Oxley Act of 2002 if a restatement is due to the material noncompliance of the Company as a result of misconduct.

The Compensation Committee is responsible for approving our compensation practices and oversees the executive compensation program for our NEOs in a manner that is consistent with RXO’s compensation philosophy. The Compensation Committee is comprised of independent, non-employee members of the Board. The Compensation Committee acts independently but works closely with the board, its independent consultant, and with management to examine the effectiveness of the Company’s incentive and executive compensation programs throughout the year. Details of the Compensation Committee’s authority and responsibilities are specified in its charter. The Compensation Committee makes all final compensation and equity award decisions regarding our NEOs.

Members of our management team provide input to the Compensation Committee and attend portions of meetings where executive compensation is discussed and evaluated. Our chief executive officer, Mr. Wilkerson, provides recommendations for proposed compensation actions with respect to our executive team, but not with respect to his own compensation. The Committee carefully and independently reviews the recommendations of NEO pay and consults its independent advisor before making final determinations. Independent members of the Committee make all final determinations regarding CEO compensation. We believe this process ensures our executive compensation program effectively aligns with RXO’s compensation philosophy and stockholder interests.

The Compensation Committee retained Pearl Meyer & Partners, LLC as its independent advisor. Among other things, the Committee’s independent advisor consults on compensation and governance matters, monitors trends and evolving market practices in executive compensation, and provides general advice and support to the Committee and Committee’s chair. In 2023, Pearl Meyer supported the Committee by reviewing the peer group companies, the go-forward long-term incentive award terms and design, benchmarking analysis, incentive plan risk assessment, and by reviewing the content of this Compensation Discussion and Analysis.

The Compensation Committee considered Pearl Meyer’s independence in light of applicable SEC rules and NYSE listing standards. After considering the absence of any relationships with management and members of the Committee, as well as Pearl Meyer’s internal policies and other information provided to the Committee, the Committee determined that no conflicts of interest existed that would prevent the firm from serving as its independent compensation consultant.

All equity awards to NEOs are approved by the Compensation Committee with a grant date determined at the time of approval. The Committee does not target a specific time during the year to make equity grants, but grant dates are no earlier than the date of Committee approval.

Our NEOs generally are provided with the same benefits as are offered to other eligible employees, including participation in the RXO, Inc. 401(k) Plan and insurance benefit programs.

We believe it’s in the best interests of our company to enter into agreements with our NEOs that allow the Compensation Committee to exercise discretion in designing incentive compensation programs. In addition, we have adopted an executive severance plan, which we believe balances our desire not to engage in case-by-case negotiations with respect to executive departures with potential costs to RXO, and the importance of having a severance plan to our ability to attract and retain talented executives. The material compensation-related terms of these agreements and plan are described under the heading “Narrative Description of Arrangements with NEOs” in the section that follows this Compensation Discussion and Analysis.

Section 162(m) of the Internal Revenue Code of 1986, as amended, disallows a federal income tax deduction to public companies for compensation greater than $1 million paid in any tax year to covered executive officers. As a general matter, while tax deductibility is one of several relevant factors considered by the Compensation Committee in determining compensation, we believe that the tax deduction limitation imposed by Section 162(m) should not compromise RXO’s access to compensation arrangements that will attract and retain a high level of executive talent. Accordingly, the Compensation Committee and our Board will take into consideration a multitude of factors in making executive compensation decisions and may approve executive compensation that is not tax deductible.

The Compensation Committee monitors the risks associated with our compensation philosophy and programs. The Compensation Committee ensures the Company’s compensation structure strikes an appropriate balance in motivating our senior executives to deliver long-term results for the Company’s stockholders while holding our senior leadership team accountable. The Compensation Committee believes that the Company’s compensation policies and practices for its employees are not reasonably likely to give rise to risk that would have a material adverse effect on the Company. In reaching this conclusion, we considered the following:

For these reasons, the Compensation Committee has concluded that the programs by which our executives are compensated strike an appropriate balance between short- and long-term compensation and incentivize our executives to act in a manner that prudently manages enterprise risk.

The following statement made by the Compensation Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that we specifically incorporate such statement by reference.

The Committee reviewed the Compensation Discussion and Analysis with management as required by Item 402(b) of Regulation S-K. Based on this review and the resulting discussions with management, the Compensation Committee recommended to our Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Michelle Nettles, Chair

Mary Kissel

Stephen Renna

The following table sets forth information concerning the compensation awarded to, earned by or paid to our NEOs for the year ended December 31, 2023.

The following table sets forth additional details regarding grants of equity and non-equity plan-based awards. The table below includes awards that were granted by RXO in 2023, as described below.

RXO Severance Plan. The NEOs are eligible participants under the RXO severance plan.

Pursuant to the severance plan, any RXO executive officer whose employment is terminated without “cause” at any time, other than within the two years following a “change in control” (as such terms are defined in the severance plan) of RXO, would be entitled to receive (subject to the officer’s execution of a release of claims in favor of RXO and continuing compliance with the officer’s confidential information protection agreement that includes restrictive covenants relating to confidentiality, ownership of intellectual property, non-hire and non-solicitation of employees, non-solicitation of customers, non-competition and non-disparagement):

Pursuant to the severance plan, any RXO executive officer whose employment is terminated without “cause” or who resigns for “good reason” on, or within the two years following, a “change in control” (as such terms are defined in the severance plan) of RXO, would be entitled to receive (subject to the officer’s execution of a release of claims in favor of RXO and continuing compliance with the officer’s confidential information protection agreement or other similar contractual obligations):

The severance plan provides that, in the event that the payments and benefits to any participant in connection with a change in control, whether pursuant to the severance plan or otherwise, would be subject to the golden parachute excise tax imposed under Sections 280G and 4999 of the Internal Revenue Code, then the participant will either receive all such payments and benefits and pay the excise tax, or such payments and benefits will be reduced to the extent necessary so that the excise tax does not apply, whichever approach results in a higher after-tax amount of the payments and benefits being retained by the participant.

Cash severance payable under the severance plan will be offset by any other severance payments to which the officer is entitled in respect of the applicable termination of employment, including pursuant to the RXO confidential information protection agreement, as applicable, which provides for payments of the RXO executive officer’s base salary for the duration of his or her post-termination non-compete period.

Equity Award Provisions. The RXO 2022 Omnibus Incentive Compensation Plan provides that, unless otherwise provided in an award agreement, in the event of a change of control of RXO, awards will be assumed and replaced by awards of equivalent value in connection with the change of control and such assumed awards will have so-called “double trigger”

vesting provisions, such that the awards will vest in full and become immediately exercisable upon qualifying terminations of employment during the two-year period following the change of control. However, in the event that awards are not replaced with awards of equivalent value, the vesting of the awards will generally accelerate immediately prior to the change of control. In addition, generally our equity award agreements provide for pro-rated vesting in the event of a termination without cause at any time.

Restrictive Covenants. Under the NEO confidential information protection agreements, as applicable, the applicable NEO is generally subject to the following restrictive covenants: employee and customer non-solicitation during employment and for a period of two years thereafter; confidentiality and non-disparagement during employment and thereafter; and non-competition during employment and for a minimum period of 24 months thereafter.

The following table sets forth the outstanding RXO stock awards held by our NEOs as of December 31, 2023. There were no stock option awards outstanding.

The following table sets forth the RXO stock awards that vested for our NEOs during 2023. There were no stock options exercised.

The following table sets forth the amounts of compensation that would be due to each of the NEOs upon the termination events as summarized below, as if each such event had occurred on December 31, 2023. The amounts shown below are estimates of the payments that each NEO would receive in certain instances. The actual amounts payable will only be determined upon the actual occurrence of any such event. Also see “Narrative Description of Arrangements with NEOs” above for a description of these arrangements.

As required by applicable SEC rules, we are providing the following information about the relationship of the annual total compensation of our CEO to that of our median employee. The pay ratio and annual total compensation amount disclosed in this section are reasonable estimates that have been calculated using methodologies and assumptions permitted by SEC rules.

After identifying the median employee as described above, we calculated the annual total compensation for this employee using the same methodology we used for our CEO in the 2023 Summary Compensation Table. This compensation calculation includes, where applicable, base salary and wages, bonuses, commissions, overtime, holiday or PTO pay, equity awards, and 401(k) company match. The compensation for our median employee was $58,016 and the compensation for our company’s CEO was $5,665,191.

Based on the above information, we reasonably estimate that for 2023 our CEO’s annual total compensation was approximately 98 times that of the median of the annual total compensation of all our employees excluding the CEO. The pay ratio reported by other companies may not be comparable to the pay ratio reported above, due to variances in business mix, proportion of seasonal and part-time employees, and distribution of employees across geographies. We seek to attract, incentivize and retain our employees through a combination of competitive base pay, bonus opportunities, 401(k) contributions, and other benefits.