UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Annual Report Pursuant To Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the year ended December 31, 1996
Commission file number 1-19773
OTR EXPRESS, INC.
(Exact name of registrant as specified in its charter)
Kansas
(State or other jurisdiction or of incorporation
of organization)
48-0993128
(IRS Employer Identification No.)
804 N. Meadowbrook Drive, Olathe, Kansas
(Address of principal executive offices)
66062
(Zip Code)
Registrant's telephone number, including area code (913) 829-1616
Securities Registered Pursuant to Section 12(g) of the Act:
Title of each class
Common Stock, $.01 par value
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 the
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.
(1) Yes X No (2) Yes X No
Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will
not be contained to the best of Registrant's
knowledge in definitive proxy or information
statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. ____
The aggregate market value of voting stock
held by non-affiliates of the registrant was
$5,751,609 as of February 28, 1997.
1,840,515
(Number of shares of common stock outstanding as of
February 28, 1997)
Part II incorporates certain information by
reference from the Registrant's Annual Report
to Stockholders for fiscal year ended December
31, 1996 and Part III incorporates certain information
by reference from the Registrant's definitive
proxy statement dated April 2, 1997.
OTR EXPRESS, INC.
1996 Annual Report on Form 10-K
Table of Contents
Page
Part I
Item 1. Business 3
Item 2. Properties 9
Item 3. Legal Proceedings 9
Item 4. Submission of Matters to a
Vote of Security Holders 9
Part II
Item 5. Market for Registrant's Common
Equity and Related Stockholder
Matters 10
Item 6. Selected Financial Data 10
Item 7. Management's Discussion and
Analysis of Financial Condition and
Results of Operations 10
Item 8. Financial Statements and
Supplementary Data 10
Item 9. Changes in and Disagreements with
Accountants on Accounting and
Financial Disclosures 10
Part III
Item 10. Directors and Executive Officers
of the Registrant 11
Item 11. Executive Compensation 11
Item 12. Security Ownership of Certain
Beneficial Owners and Management 11
Item 13. Certain Relationships and Related
Transactions 11
Part IV
Item 14. Exhibits, Financial Statement
Schedules, and Reports on Form 8-K 11
PART I
Item 1. Business
Overview
The discussion set forth below as well as other documents incorporated
by reference herein and oral statements made by officers of the Company
relating thereto, may contain forward looking statements. Such comments
are based upon information currently available to management and management's
perception thereof as of the date of this Form 10-K. Actual results
of the Company's operations could materially differ from those forward
looking statements. Such differences could be caused by a number of
factors including, but not limited to, potential adverse affects of
regulation; changes in competition and the effects of such changes; increased
competition; changes in fuel prices; changes in economic, political or
regulatory environments; litigation involving the Company; changes in the
availability of a stable labor force; ability of the Company to hire
drivers meeting Company standards; changes in management strategies;
environmental or tax matters; and risks described from time to time in
reports filed by the Company with the Securities and Exchange Commission.
Readers should take these factors into account in evaluating any such
forward looking statements.
The Company
OTR Express, Inc., a Kansas corporation organized in 1985
(the "Company" or "OTR") operates
as a long-haul, dry van, truckload carrier. The Company
transports a diversified mix of general commodities,
including paper products, food products, furniture, wire and
retail goods for a large base of customers (currently over
1,000) throughout the continental United States. OTR is
headquartered in Olathe, Kansas, a suburb of Kansas City,
Missouri.
Operating Strategy
OTR's operating strategy is based in large part upon its
proprietary Freight Optimization System - a next move
probability based freight system. The system, developed
internally over the last nine years, utilizes the Company's
computer network and software system and consists of the
following four components: (i) rate analysis, (ii) customer
priority ranking, (iii) fleet replanning and (iv) equipment
dispersal management.
The Freight Optimization System enables the Company to
analyze historical data to prioritize customers most likely
to have freight that will produce the most profitable
combination of rates and destination. The system is designed
to maximize freight opportunities, maximize revenue per mile
and minimize empty miles.
Rate Analysis. The Company obtains market
information on freight rates and destinations on a daily
basis. This enables the Company to ensure that OTR is
obtaining market rates on all freight.
Customer Priority Ranking. The Freight
Optimization System continually analyzes each customer's
freight history and develops a customer priority ranking
to direct our load planners to call customers with the highest
probability of giving OTR the most profitable combinations
of rates and destinations.
Fleet Replanning. The Freight Optimization
System replans OTR's fleet every three minutes and
provides the Company's load planners with a time sensitive
listing of the trucks that need to be reloaded.
Equipment Dispersal Management. The
equipment dispersal management system monitors the
distribution of trucks across the country to maximize
freight opportunities and minimize empty miles and downtime.
In 1996, due to changing market conditions, the Company
began marketing to larger national accounts capable of offering
increased load counts at higher revenue rates. These
larger shippers require additional services including
guaranteed equipment availability, drop trailers and
fifty-three foot trailers. Additionally, in 1996,
the Company began offering QualComm satellite communications
on every truck and electronic data interchange (EDI) for
load status information to serve the larger national
accounts. These larger shippers can
be integrated into the Company's existing operating
strategy effectively, providing a higher mix of more
profitable shipper freight. The Freight Optimization
System will continue to locate the most profitable
combination of moves, working in conjunction with the new
national accounts program.
This operating strategy has contributed to the Company's
rapid growth during the five year period ending December 31,
1996, with revenue increasing to $55.3 million in 1996 from
$16.9 million in 1991 (a compound annual growth rate of 26.7%),
and a corresponding increase in its fleet to 503 tractors from
162 during the same period. The Company intends to continue its
expansion and growth by acquiring approximately 50 new tractors
in 1997. These expansion plan commitments are flexible and
conditioned upon freight demand.
Customers and Marketing
OTR has developed a marketing strategy that is
designed to maintain a large customer base that is
diversified in terms of geographic location and types of
commodities shipped. The Company markets its services based
on dependable, time definite delivery, service and pricing.
The Company obtains freight in three different
manners: directly from shippers ("OTR Shippers"), through
Company agents ("Agent Shippers") and from freight brokers.
OTR Shippers are marketed directly by internal OTR sales
representatives. Agent Shippers are marketed by the
Company's outside sales agents. The Company's customer
database includes approximately 450 OTR Shippers, 275 Agent
Shippers and 275 freight brokers. In 1996, OTR Shippers
accounted for 46% of OTR's revenue miles, Agent Shippers
accounted for 14% and freight brokers accounted for 40%.
The freight obtained from OTR Shippers and Agent
Shippers is generally more profitable than freight obtained
from brokers, having freight rates which average 10% to 15%
more than brokered freight. To maximize this more
profitable revenue base by generating new OTR Shippers, OTR
increased the number of its internal sales representatives
and customer service representatives to thirteen at February
28, 1997 from three at December 31, 1994. These sales
representatives have historically operated primarily through
direct telemarketing efforts. In 1996,
the Company began making trips to current customers
and prospective customers in conjuction
with its national account program. The Company plans to
continue aggressive expansion of its internal sales force
as well as the network of outside sales agents in 1997.
For the year ended December 31, 1996, the Company's
20, 10 and five largest customers accounted for 29.9%, 20.6%
and 13.1%, respectively, of the Company's operating revenue.
The largest customer accounted for 3.8% of the Company's
operating revenue for that period.
Freight Brokerage Division
To better service its customers, OTR has developed
a freight brokerage division which brokers loads to other
carriers. By brokering loads which the Company views as
less profitable under its Freight Optimization System, the
Company is able to increase its profitability while
satisfying its customers' shipping needs without utilizing
Company owned equipment. Freight brokerage division revenue
increased to $3.3 million in 1996 from $2.6 million in 1995.
In 1996, the Company hired additional staff for its
brokerage operation.
The Company's brokered freight is obtained through
a network of freight brokers who contract for freight
directly from shippers and re-contract with the Company to
transport the freight. A freight broker helps carriers
obtain loads in areas where the carrier does not typically
have a large number of customers, thereby minimizing the
empty miles of the carrier. Freight brokers typically earn
a margin of approximately 10%-15% of the carrier's freight
fee. The Company has developed a network of approximately
282 freight brokers. The Company believes that it has
excellent relationships with these freight brokers, and that
this network provides both profitable loads and valuable
information for the Company's Freight Optimization System.
Drivers and Other Employees
Recruiting and retaining professional, experienced
drivers is critical to the Company's success, and all of the
Company's drivers must meet specific guidelines relating
primarily to safety record, driving experience and personal
evaluation, including drug and alcohol testing. OTR's
drivers have an average age of 47.5 years and average 15.3
years of driving experience. Within the Company, drivers
are considered "managers" and are given a high level of
responsibility to manage the profitability of their
equipment.
The Company's Driver Incentive Management System
allows experienced drivers to earn higher compensation than
prevailing industry wages. The Company provides incentive
programs for its drivers based on miles driven, fuel
efficiency, safety record and profitability. OTR considers
each tractor and its driver to be a separate profit center,
with profit center reports, including the actual revenue and
expense of the equipment and fixed expense components for
administration, taxes and depreciation, generated monthly.
Under the Company's "profit center" program, drivers can
receive quarterly distributions equal to 50% of the net
income of their profit center, up to a maximum of $2,650 in
any calendar year. The program is designed to give OTR's
drivers the incentive to improve their individual
productivity, minimize costs and thereby increase overall
Company profitability.
Driver recruitment and retention is essential to
the maintenance of high equipment utilization, particularly
during periods of rapid fleet growth. OTR's drivers are
given recruiting bonuses for the referral of new drivers to
the Company. In order to attract and retain highly
qualified drivers and to promote safe operations, the
Company purchases premium quality tractors
and equips them with optimal comfort and safety features,
such as on-board satellite communications, high quality
interiors, power steering, automatic braking systems, engine
brakes and oversized sleepers.
At December 31, 1996, the Company's ratio of
tractors to non-driving employees was 5.59 to one, which
management believes is well above industry standards. At
February 28, 1997, the Company had 591 employees, of whom
488 were drivers and 103 were management and administrative
personnel. The Company's employees are not represented by a
collective bargaining unit. Employees participate in OTR's
401(k) program and in Company-sponsored health, life and
dental plans. The Company does not have any employees who
are receiving post retirement benefits and does not
anticipate offering any post retirement benefits in the
future. Management considers relations with its employees
to be very good. The Company's driver turnover rate was 73%
in 1996, which is below industry average.
Revenue Equipment
The Company believes that a key to the successful
retention of drivers is the use of standardized, fuel
efficient, late-model tractors and trailers. The Company
purchases all new tractors, primarily with driver comfort,
fuel efficiency, safety and overall economy in mind. To
recruit and retain high-quality drivers, all the tractors
owned by the Company have deluxe interiors and oversized
sleepers. The average age of OTR's tractors and trailers at
December 31, 1996 was 1.8 years and 1.9 years, respectively.
The Company plans its trade cycle based on engine warranties
and routinely replaces its tractors after forty months of
use (approximately 400,000 miles).
At December 31, 1996 the Company owned 232 Navistar
tractors, 138 Peterbilt tractors and 133 Freightliner
tractors. The tractors include engines which are fully
electronic, manufactured by Detroit Diesel, Caterpillar or
Cummins. Trailers in the fleet at year end were
manufactured by Pines, Utility, Stoughton, Trailmobile and
Fruehauf. All of the Company's trailers have a 110 inch
inside and are 102 inches wide, the maximum width generally
allowed by law. The trailer fleet at December 31, 1996
included 205 fifty-three foot trailers and 403 forty-eight
foot trailers.
The following table shows the age of Company
equipment in service at December 31, 1996.
Acquisition Year Tractors Trailers
1996 67 205
1995 248 130
1994 145 120
1993 43 85
1992 _ 68
Total 503 608
The Company's preventive maintenance program
focuses on early diagnosis of problems and contracting
maintenance out to third-party providers. In addition to
annual DOT inspections, tractors are inspected when they
pass through the Company's diagnostic facilities at its
headquarters. All tractors are under warranty and are
generally traded in before their engine warranties expire.
The exclusive use of third-party maintenance providers,
coupled with the effective utilization of manufacturers'
warranties and the Company's trade-in policy, allows the
Company to minimize its maintenance costs.
Fuel Availability and Cost
The Company actively manages its fuel costs through
a five component fuel management system which incorporates:
wholesale purchasing for the Company's unmanned fuel
facilities, mileage pay rates based upon fuel economy, the
"profit center" incentive driver compensation program, fuel
hedging and equipment specifications. See "_ Drivers and
Other Employees."
The Company owns five automated fuel facilities,
one located at the Company's headquarters in Kansas and one
each located on major traffic lanes in Arizona, Ohio, Texas
and Wyoming. Each of the four remote unmanned fuel
facilities consists of an above-ground fuel tank, pump and a
computer modem linking it directly to the Company's
computers. In 1996, the Company purchased 32.1% of its fuel
in bulk for distribution through its automated fuel
facilities. These facilities allow the Company to purchase
fuel at wholesale prices.
As a way to protect the Company against major fuel
price increases and "smooth" its fuel costs, since October
1994 the Company has engaged in a fuel hedging strategy.
Pursuant to this program, the Company buys six month call
options within $.10 of current market prices, to buy futures
contracts for #2 heating oil, in amounts equal to the
Company's anticipated fuel purchases for such period.
All of the Company's tractors have fully electronic
engines, which typically deliver enhanced fuel economy
compared to tractors with mechanically governed engines.
Environmental Matters
The Company's operations are subject to federal,
state and local laws and regulations concerning the
environment. There is the possibility of environmental
liability as a result of the Company's use of fuels, from
the fuel storage tanks installed at its fuel facilities and
also from the cargo it may transport. The Company's only
underground storage tanks are two fiberglass tanks installed
at its headquarters facility. One tank was installed in
1988 and the other in 1995. The tanks have overfill
protection hardware, spill containment manhole covers and
leak detection equipment. The Company believes that the use
of above-ground storage tanks at its remote fuel facilities
minimizes both potential liability and the cost of
compliance with environmental regulations. The Company
occasionally transports environmentally hazardous substances
in accordance with haz-mat guidelines. To date, the Company
has experienced no material claims for hazardous substance
shipments. The Company believes that its environmental
practices comply with applicable federal, state and local
environmental laws and regulations. In the event the
Company should fail to comply with applicable regulations,
the Company could be subject to substantial fines or
penalties and to civil or criminal liability.
Competition
The truckload industry is extremely competitive and
highly fragmented, with numerous regional, inter-regional
and national truckload carriers, none of which dominates the
market. The Company competes primarily with other long-haul
truckload carriers, rail-truck intermodal transportation,
railroads and, to a lesser degree, with less-than-truckload
(LTL) carriers. Most of
OTR's larger truckload competitors
utilize "core carrier" or "lane density" marketing concepts,
which emphasize greater individualized service to a smaller
number of shippers. Many long haul truck load carriers
utilize driver teams which allow them to provide expedited
service while complying with DOT regulations concerning
driver's duty hours. OTR's drivers consist principally
of single drivers. Intermodal transportation and railroads
typically have created downward pressure on the truckload
industry's pricing structure. The Company competes for
freight based primarily on freight rates, service and
reliability.
Governmental Regulation
The Company is a contract and common motor carrier
subject to the authority of federal and state agencies.
These regulatory authorities have broad powers, but the
rates and charges of the Company are not directly regulated
by these authorities. OTR, as primarily a contract carrier,
negotiates competitive rates directly with its customers as
opposed to adhering to scheduled tariffs.
The trucking industry is subject to regulatory and
legislative changes such as increasingly stringent
environmental regulations and limits on weight and size that
can affect the economics of the industry by requiring
changes in operating practices or influencing the demand
for, and the costs of providing, services to shippers.
In August 1994, the Federal Aviation Administration
Authorization Act of 1994 (the "1994 FAA Act") became law.
Effective January 1, 1995, the 1994 FAA Act preempted
certain state and local laws regulating the prices, routes
or services of motor carriers (other than household
carriers). State agencies may continue to impose tax,
license, bonding and insurance requirements. The 1994 FAA
Act does not limit the authority of a state or other
political subdivision to impose safety regulations or
highway route limitations or controls based on the size or
weight of the motor vehicle, the hazardous nature of cargo
being transported by motor vehicles or minimum financial
responsibility requirements relating to insurance and self-
insurance authorization.
The Negotiated Rates Act of 1993 ("NRA"), in
tandem with the Trucking Industry Regulatory Reform Act of
1994 ("TIRRA"), further redefined the regulatory structure
applicable to interstate transportation of goods. The NRA
provided further regulation governing interstate
transportation, including prohibitions on off-bill
discounting, certain re-regulation of contract shipping
arrangements, and, with respect to common carriers,
regulation regarding the collection of undercharge claims,
and applicable defenses and exceptions to such claims. The
TIRRA further deregulated the trucking industry by partially
repealing the "filed-rate" doctrine previously applicable to
common carriers. Under the TIRRA, while collectively-made
bureau rates must still be published in tariffs,
individually negotiated rates are not.
The Company's drivers must be licensed as
"commercial drivers" pursuant to requirements established by
the Federal Highway Administration ("FHA") of the DOT. In
addition to the knowledge and driving skills tests required
to obtain a commercial driver's license (a "CDL"), there are
various disqualifying offenses set forth in the FHA rules,
which, if committed, result in suspension or termination of
the operator's CDL, as well as potential civil or criminal
liabilities. Also, DOT regulations impose mandatory drug
testing of drivers and the Company has its own ongoing drug-
testing program. DOT alcohol testing rules require certain
tests for alcohol levels in drivers and other safety
personnel.
Motor carrier operations are also subject to
safety, equipment and operators' hours of service
requirements prescribed by the DOT. During 1993, the
Company underwent a DOT audit of its driver logs and
currently has a satisfactory rating.
Safety
The Company maintains a program for training and
supervising personnel to keep safety awareness at its
highest level. The emphasis on safety begins in the hiring
and training process. A minimum of 1.5 years of over-the-
road driving experience is required for new drivers. OTR
also verifies the driving records of all new drivers before
they begin employment. Prospective employees are given
physical examinations and drug tests, and newly hired
drivers are trained in the Company's safety procedures.
In general, any driver who violates the Company's safety
standards will receive a warning letter, and any driver who
has more than two such violations within certain periods of
time is subject to termination. The Company continuously
monitors driver performance and has final authority
regarding employment and retention of drivers. OTR
currently has a "satisfactory" safety and fitness rating
from the DOT. See "_ Governmental Regulation."
Item 2. Properties
The Company owns real estate in Olathe, Kansas, where
the Company is headquartered. The property includes a
22,000 square foot office facility and a 9,400 square foot
diagnostic and inspection facility. The property also
includes approximately 258,000 square feet of parking space
and the Kansas fuel facility. Additionally, the Company
owns tracts, each approximately one acre in size, in
Arizona, Ohio, Texas and Wyoming, on which its remote fuel
facilities are located. See "Item 1, Fuel Availability and Cost."
Item 3. Legal Proceedings
The Company is routinely a party to litigation
incidental to its business, primarily involving claims for
personal injuries and property damage incurred in the
transportation of freight. All litigation in which the
Company is currently involved is covered by the Company's
liability insurance (personal injury, physical damage and
cargo) or workers' compensation insurance. The Company
believes the ultimate outcome of current litigation will not
have a material adverse effect on its financial position or
results of operations.
The Company maintains liability insurance (including
umbrella coverage) in the amount of $10 million per
occurrence for personal injury, property damage and cargo.
Under the terms of the policy, the Company retains the first
$100,000 of losses paid and loss adjusting expense. The
Company is self-insured for workers' compensation insurance.
The Company is responsible for claims up to $250,000 per
occurrence. The Company carries excess insurance to cover
losses over $250,000, subject to a maximum coverage of $10
million per occurrence and per year.
Item 4. Submission of Matters to a Vote of
Security Holders
None.
PART II
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters
The information required by this Item is incorporated
by reference from the Company's Annual Report to Stock-
holders for the fiscal year ended December 31, 1996, under
the caption "Price Range of Stock."
Item 6. Selected Financial Data
The information required by this Item is incorporated
by reference from the Company's Annual Report to Stock-
holders for the fiscal year ended December 31, 1996, under
the caption "Financial Highlights."
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations
The information required by this Item is incorporated
by reference from the Company's Annual Report to Stock-
holders for the fiscal year ended December 31, 1996 under
the caption "Financial Review."
Item 8. Financial Statements and Supplementary Data
Index to Financial Statements
The information required by this Item is incorporated
by reference from the Company's annual report to security-
holders for the fiscal year ended December 31, 1996 under
the caption "Financial Statements" and "Quarterly Financial
Data."
Annual Report Page
Report of Independent Public Accountants 13
Balance Sheets 14
Statements of Operations 15
Statements of Stockholders' Equity 16
Statements of Cash Flows 17
Notes to Financial Statements 18
Supplemental Financial Information 26
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosures.
None.
PART III
Item 10. Directors and Executive Officers of the
Registrant
The information required by this Item is incorporated
by reference from the Company's definitive Proxy Statement
under the headings "Proposal One: Election of Class B
Directors-Nominees," "The Board of Directors-Continuing
Directors," "Executive Officers-Information About Other
Executive Officers" and "Miscellaneous-Section 16
Reporting" to be filed with the Commission not later than
120 days after the end of the fiscal year covered by this
Form 10-K.
Item 11. Executive Compensation
The information required by this Item is incorporated
by reference from the Company's definitive Proxy Statement
under the heading "Executive Officers-Executive Compensation and Other
Information" to be filed with the Commission not later than
120 days after the end of the fiscal year covered by this
Form 10-K.
Item 12. Security Ownership of Certain Beneficial
Owners and Management
The information required by this Item is incorporated
by reference from the Company's definitive Proxy Statement
under the heading "Stock Ownership of Certain Beneficial
Owners and Management" to be filed with the Commission not
later than 120 days after the end of the fiscal year covered
by this Form 10-K.
Item 13. Certain Relationships and Related Transactions
None.
PART IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K
List of Documents filed as part of this Report on Form 10-K.
(1) Financial Statements
All financial statements of the Registrant as
set forth under Item 8 of this Report on Form 10-K.
(2) Financial Statements Schedules
Page of
Schedule Number Description 1996 10-K
II Valuation and Qualifying Accounts 16
The report of the Registrant's independent public
accountants with respect to the above listed financial
statements and financial statement schedules appears on page
15 of this Annual Report on Form 10-K.
All other financial statement schedules not listed
above have been omitted since the required information is
included in the financial statements or the notes thereto,
or is not applicable or required.
Reports on Form 8-K
No reports on Form 8-K were filed for the year ended
December 31, 1996.
Exhibits
Exhibit
Number Description Page Number orIncorporation
By Reference To
3(a) Articles of Incorporation, Exhibit 3(a) to AnnualReport
as, amended for the year ended Dec 31, 1994
on Form 10-K (SEC File
No. 1-19773)
3(b) Restated By-Laws Exhibit 3(b) to Annual Report
for the year ended Dec 31, 1995
on Form 10-K (SEC File
No. 1-19773)
4 The Registrant, by signing
this Report, agrees to furnish
the Securities and Exchange
Commission, upon its request,
a copy of any instrument which
defines the rights of holders
of long-term debt of the
Registrant.
4(a) Specimen Common Stock Certificate Exhibit 4(a) to Amendment No. 1
to Registration Statement on
Form S-18(SEC File
No. 33-44422FW)
10(a) 1991 Incentive Stock Option Exhibit 10(a) to Registration
Plan of OTR Express, Inc Statement on Form S-18 (SEC File
No. 33-44422FW)
10(b) Assignment regarding post Exhibit 10(aa) to Annual
office box dated June 26, Report for the year ended
1992 between Registrant and Dec 31, 1992 on Form 10-K
Boatmen's First National Bank (SEC File No. 1-19773)
of Kansas City
10(c) Mortgage note dated January 10, Exhibit 10(xx) to Annual
1995 between Registrant and Report for the year ended
Toni J. Waggoner and Robert E. Dec 31, 1994 on Form 10-K
Waggoner , as Trustees (SEC File No. 1-19773)
10(d) Accounts Receivable Loan Exhibit 10(zz) to Annual
Agreement dated August 27, Report for the year ended
1995 between Registrant and Dec 31, 1995 on Form 10-K
Boatmen's First National (SEC File No. 1-19773)
Bank of Kansas City
10(e) Amendment to Accounts Exhibit 10(aaa) to Annual
Receivable Loan Agreement Report for the year ended
dated April 27, 1995 between Dec 31, 1995 on Form 10-K
Registrant and Boatmen's (SEC File No. 1-19773)
First National Bank of
Kansas City
10(f) OTR Express, Inc. 1996 Stock Exhibit 10(bbb) to Annual
Option Plan Report for the year ended
Dec 31, 1995 on Form 10-K
(SEC File No. 1-19773)
10(g) OTR Express, Inc. 1996 Exhibit 10(ccc) to Annual
Directors' Stock Option Report for the year ended
Plan Dec 31, 1995 on Form 10-K
(SEC File No. 1-19773)
10(h) Form of Carrier/Shipper Page 17 of sequentially
Transportation Contract numbered pages
10(i) Contract to Purchase Tractors Page 19 of sequentially
in 1997 between Registrant and numbered pages
KCR International Trucks, Inc.
10(j) Contract to Purchase Trailers Page 20 of sequentially
in 1997 between Registrant and numbered pages
Utility Trailer Sales of
Kansas City
10(k) Accounts receivable Loan Page 21 of sequentially
Agreement dated May 1, 1996 numbered pages
between Registrant and UMB
Bank, N.A.
11 Statement re: Computation of Page 26 ofsequentially
Earnings per Share numbered pages
13 Annual Report to Stockholders Page 27 of sequentially
for the year ended December numbered pages
31, 1996
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, the registration has
duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
OTR EXPRESS, INC.
Date: March 15, 1997 /s/WILLIAM P. WARD
Chairman of the Board
Pursuant to the requirements of the Securities
Exchange Act of 1934, this report has been signed below by
the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
Signature Title Date
/s/ WILLIAM P. WARD Chairman of the Board March 15, 1997
William P. Ward President and
Principal Executive Officer
/s/ GARY J. KLUSMAN Executive Vice President March 15, 1997
Gary J. Klusman and Director
/s/ JANICE K. WARD Vice President March 15, 1997
Janice K. Ward Compensation and
Administration, Secretary
and Director
/s/ STEVEN W. RUBEN Vice President Finance March 15, 1997
Steven W. Ruben Principal Financial Officer
and Principal Accounting
/s/ CHRISTINE D. SCHOWENGERDT Treasurer March 15, 1997
Christine D. Schowengerdt
/s/ JAMES P. ANTHONY Director March 15, 1997
James P. Anthony
/s/ DEAN W. GRAVES Director March 15, 1997
Dean W. Graves
/s/ RALPH E. MACNAUGHTON Director March 15, 1997
Ralph E. MacNaughton
/s/ TERRY G. CHRISTENBERRY Director March 15, 1997
Terry G. Christenberry
/s/ CHARLES M. FOUDREE Director March 15, 1997
Charles M. Foudree
/s/ FRANK J. BECKER Director March 15, 1997
Frank J. Becker
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON SCHEDULES
To the Board of Directors and Stockholders of OTR Express,
Inc.:
We have audited in accordance with generally accepted
auditing standards, the financial statements included in OTR
Express, Inc.'s annual report to shareholders incorporated
by reference into this Form 10-K, and have issued our report
thereon dated February 4, 1997. Our audits were made for
the purpose of forming an opinion on those statements taken
as a whole. Schedule II is presented for purposes of
complying with the Securities and Exchange Commission's
rules and is not a required part of the basic financial
statements. This schedule has been subjected to the
auditing procedures applied in our audits of the basic
financial statements, and, in our opinion, fairly states in
all material respects, the financial data required to be set
forth therein in relation to the basic financial statements
taken as a whole.
Arthur Andersen LLP
Kansas City, Missouri
February 4, 1997
Schedule II
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Balance at Additions Balance at
Beginning Charged to End
of Year Expense Deductions of Year
Allowance for doubtful accounts
1994 40,279 30,989 31,272 39,996
1995 39,996 21,840 4,904 56,932
1996 56,932 38,070 37,986 57,016
CORPORATE INFORMATION
Corporate Offices Common Stock Listing
OTR Express, Inc. OTR Express, Inc. common stock
804 N. Meadowbrook Drive is traded on the NASDAQ National
Olathe, Kansas 66062 Market System under the symbol:
(913) 829-1616 OTRX
Mailing address:
PO Box 2819
Olathe, Kansas 66063-0819