FORM 11-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [ NO FEE REQUIRED]
For the fiscal year ended December 31, 1998.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______________ to ________________
Commission file number 0-20793
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
SMITHWAY MOTOR XPRESS, INC. 401(k) RETIREMENT SAVINGS
AND INVESTMENT PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Smithway Motor Xpress Corp.
2031 Quail Avenue
Fort Dodge, Iowa 50501
SMITHWAY MOTOR XPRESS, INC. 401(K)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Financial Statements and Schedules
December 31, 1998 and 1997
(With Independent Auditors' Report Thereon)
SMITHWAY MOTOR XPRESS, INC. 401(K)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Table of Contents
Page
Independent Auditors' Report 1
Statements of Net Assets Available for Plan Benefits 2
Statements of Changes in Net Assets Available for Plan Benefits 2
Notes to Financial Statements 3
Schedule
1 Item 27a - Schedule of Assets Held for
Investment Purposes 6
2 Item 27a - Schedule of Assets Held for Investment
Purposes Which Were Both Acquired and
Disposed of Within the Plan Year 7
3 Item 27b - Schedule of Loans or Fixed Income Obligations 7
4 Item 27c - Schedule of Leases in Default or
Classified as Uncollectible 7
5 Item 27d - Schedule of Reportable Transactions 8
6 Item 27e - Schedule of Nonexempt Transactions 8
Independent Auditors' Report
The Plan Trustees
Smithway Motor Xpress, Inc. 401(k) Retirement Savings and Investment Plan:
We have audited the statements of net assets available for plan benefits of
Smithway Motor Xpress, Inc. 401(k) Retirement Savings and Investment Plan
as of December 31, 1998 and 1997, and the related statements of changes in
net assets available for plan benefits for the years then ended. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the net assets available for plan benefits of
Smithway Motor Xpress, Inc. 401(k) Retirement Savings and Investment Plan
as of December 31, 1998 and 1997, and the changes in its net assets
available for plan benefits for the years then ended in conformity with
generally accepted accounting principles.
Our audit of the Plan's financial statements as of and for the years ended
December 31, 1998 and 1997, was made for the purpose of forming an opinion
on the financial statements taken as a whole. The supplemental schedules 1
through 6 are presented for the purpose of additional analysis and are not
a required part of the basic financial statements, but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974. The supplemental schedules have been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in
our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
KPMG Peat Marwick LLP
Des Moines, Iowa
June 14, 1999
1
SMITHWAY MOTOR XPRESS, INC. 401(k)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 1998 and 1997
1998 1997
------------- --------------
Assets:
Cash $ 375,187 170,863
------------- --------------
Investments:
Investment in registered investment
companies 6,199,616 5,528,116
Common stock 3,562,971 6,354,817
Loans to participants 920,114 759,248
------------ --------------
10,682,701 12,642,181
Contributions receivable - employees 108,783 46,566
Contributions receivable - employer 229,526 142,579
Other receivables 11,186 21,358
------------- --------------
Total assets 11,407,383 13,023,547
Liabilities (note 6) 29,137 18,122
-------------- --------------
Net assets available for benefits (note 2) $11,378,246 13,005,425
============= ==============
Statements of Changes in Net Assets Available for Plan Benefits
Years ended December 31, 1998 and 1997
1998 1997
------------- --------------
Additions to net assets attributed to:
Employer contributions (note 3) $ 225,379 142,579
Employee contributions and rollovers (note 3) 1,289,811 605,539
Net investment (loss) income (note 2) (1,433,705) 3,346,959
------------- --------------
Total additions 81,485 4,095,077
------------- --------------
Deductions from net assets attributed to:
Benefits paid to participants (note 5) 1,668,849 1,203,991
Administrative fees 39,628 18,258
Other deductions 187 --
------------- --------------
Total deductions 1,708,664 1,222,249
------------- --------------
Net (decrease) increase in net
assets available for benefits (1,627,179) 2,872,828
Transfer in from employee stock
ownership plan (note 2) -- 8,174,002
Net assets available for benefits:
Beginning of year 13,005,425 1,958,595
------------- --------------
End of year $ 11,378,246 13,005,425
============== ===============
See accompanying notes to financial statements.
2
SMITHWAY MOTOR XPRESS, INC. 401(K)
RETIREMENT SAVINGS AND INVETMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(1) Summary of Significant Accounting Policies
Plan Information and Basis of Presentation
The accompanying financial statements of Smithway Motor Xpress, Inc. 401(k)
Retirement Savings and Investment Plan (the Plan) have been prepared on the
accrual basis of accounting and are subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA). The Plan is sponsored by
Smithway Motor Xpress Corp. (the Company) and has two entry dates per year.
Full-time employees are eligible for participation in the Plan on the next entry
date after completing one year of service. Participants should refer to the Plan
agreement for more complete information.
Investments
Investments, other than loans, are reported at fair value, as determined by
using available market information. Loans to participants are valued at their
unpaid principal balance, representing estimated fair value.
Net investment income includes investment income, realized gains (losses),
and unrealized appreciation (depreciation) on investments held.
Administrative Fees
Certain administrative fees are paid by the Company.
Income Taxes
The Internal Revenue Service has issued a determination letter that the Plan
is qualified, and the trust established under the Plan is tax-exempt, under
Sections 401(a) and 501(a) of the Internal Revenue Code. The Plan has been
amended since receiving the determination letter. An updated determination
letter has not been requested; however, UMB Bank (the Plan Administrator) and
the Plan's tax counsel believe the Plan is currently designed and being operated
in compliance with the applicable requirements of the Internal Revenue Code.
Therefore, they believe the Plan was qualified and the related trust was
tax-exempt as of December 31, 1998 and 1997. Future qualification of the Plan
will depend on continuing operation in compliance with the Internal Revenue
Code.
Use of Estimates
The Plan Administrator has made a number of estimates and assumptions
relating to the reporting of assets and liabilities to prepare these financial
statements in conformity with generally accepted accounting principles. Actual
results could differ from those estimates.
3
SMITHWAY MOTOR XPRESS, INC. 401(K)
RETIREMENT SAVINGS AND INVETMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
Net Assets Available for Benefits
The Plan Administrator maintains funds received from the Plan primarily in
registered investment companies. During 1997, the Company transferred the assets
of its employee stock ownership plan and trust to the Plan, allowing for
investments in Company common stock.
The changes in net assets available for benefits by investment fund for the
years ended December 31, 1998 and 1997, were as follows:
Capital
Fidelity Preser-
Asset Fidelity vation PBHG Putnam
Manager Magellan Fund Growth Vista
------------ ---------- ---------- ---------- ----------
Balance at December 31, 1996 $ 60,764 870,049 209,600 381,534 92,848
Transfer from employee stock
ownership plan -- -- -- -- --
Contributions and other additions 48,446 196,778 75,493 133,382 41,316
Transfers between funds and loan activity 997,996 622,752 488,865 468,841 192,401
Net investment income 148,251 344,049 30,572 34,184 46,843
Benefit payments,withdrawals, transfers (150,396) (148,768) (117,856) (81,198) (38,008)
Administrative fees (2,234) (7,606) (772) (3,059) (648)
---------- ---------- ---------- ---------- ----------
Balance at December 31, 1997 1,102,827 1,877,254 685,902 933,684 334,752
Contributions and other additions 192,835 407,635 91,532 327,625 136,343
Transfers between funds and loan activity (37,939) (171,787) 75,120 (295,374) (64,425)
Net investment income (loss) 175,097 650,574 50,958 35,302 77,250
Benefit payments, withdrawals, transfers (229,521) (503,625) (139,381) (95,875) (46,684)
Administrative fees and other deductions (10,874) (7,705) (7,060) (4,949) (2,686)
---------- ---------- ---------- ---------- ---------
Balance at December 31, 1998 $1,192,425 2,252,346 757,071 900,413 434,550
========== ========== ========== ========== =========
Smithway
Motor
Xpress Loans
Strong Corp to
Government Common Partici-
Securities Stock pants Other Total
----------- ----------- ------------ ----------- -----------
Balance at December 31, 1996 $ 222,788 -- 86,478 34,534 1,958,595
Transfer from employee stock
ownership plan -- 8,174,002 -- -- 8,174,002
Contributions and other additions 58,572 33,306 -- 160,825 748,118
Transfers between funds and loan activity 296,779 (3,786,975) 656,181 63,160 --
Net investment income 46,217 2,676,188 16,589 4,066 3,346,959
Benefit payments,withdrawals, transfers (31,514) (738,712) -- 102,461 (1,203,991)
Administrative fees (1,572) (2,992) -- 625 (18,258)
----------- ----------- ---------- --------- ------------
Balance at December 31, 1997 591,270 6,354,817 759,248 365,671 13,005,425
Contributions and other additions 83,429 130,771 -- 145,020 1,515,190
Transfers between funds and loan activity 48,137 180,532 279,811 (14,075) --
Net investment income (loss) 56,845 (2,483,348) -- 3,617 (1,433,705)
Benefit payments, withdrawals, transfers (113,619) (598,653) (118,945) 177,454 (1,668,849)
Administrative fees and other deductions (3,251) (21,148) -- 17,858 (39,815)
----------- ----------- --------- --------- ------------
Balance at December 31, 1998 $ 662,811 3,562,971 920,114 695,545 11,378,246
=========== =========== ========= ========= ============
4
SMITHWAY MOTOR XPRESS, INC. 401(K)
RETIREMENT SAVINGS AND INVETMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(3) Contributions
Under the terms of the Plan agreement, the Company may, at its discretion,
make annual contributions to the Plan, which shall be allocated to eligible
participants based on a percentage of the total deferred compensation
contributed during the Plan year.
Employees may make voluntary contributions to the Plan up to 15% of their
compensation, subject to certain limitations as specified in the Plan agreement.
(4) Participant Accounts
Each participant's account is credited with the participant's contribution,
the employer's contribution, and an allocation of Plan earnings. Each
participant will be permitted to direct the Plan Administrator to invest their
individual accounts into various approved investments permitted under the Plan.
Participants are immediately vested in their voluntary contributions and the
earnings thereon. Vesting in the remainder of their accounts is based on years
of service in which the participant has completed at least 1,000 hours of
service. A participant is 100% vested after six years of service.
(5) Benefits
Under the terms of the Plan agreement, participants or their beneficiaries
are eligible for benefits upon retirement, death, or disability. Benefits shall
be distributed through one of several options selected by the participants, as
defined in the Plan agreement.
(6) Other Liabilities
Other liabilities include refunds payable for excess contributions received
by the Plan which are reimbursable to the participants, benefit claims payables,
and other miscellaneous operating payables.
(7) Plan Termination
Although the Company has not expressed any intent to terminate its
participation in the Plan, it may do so at any time, subject to the provisions
set forth in ERISA. Should the Plan be terminated at some future time, all
participants become 100% vested in benefits earned as of the termination date.
5
SMITHWAY MOTOR XPRESS, INC. 401(k)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Schedule 1
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1998 and 1997
1998
-----------------------------------
Fair
Description Cost value
- -------------------- --------------- -----------------
Fidelity Asset Manager $ 1,167,013 1,192,425
Fidelity Magellan 1,071,276 2,252,346
Capital Preservation Fund 757,071 757,071
PBHG Growth 621,080 900,413
Putnam Vista 406,270 434,550
Strong Government Securities 652,345 662,811
Smithway Motor Xpress Corp. common stock 688,765 3,562,971
--------------- -----------------
5,363,820 9,762,587
Loans to participants 920,114 920,114
--------------- -----------------
$ 6,283,934 10,682,701
=============== =================
1997
-----------------------------------
Fair
Description Cost value
- ------------------------------------ --------------- -----------------
Fidelity Asset Manager $ 993,077 1,102,827
Fidelity Magellan 795,160 1,877,254
Capital Preservation Fund 682,692 685,902
PBHG Growth 539,486 933,684
Putnam Vista 312,176 334,752
Strong Government Securities 577,141 591,270
Smithway Motor Xpress Corp. common stock 340,130 6,354,817
Cash 2,427 2,427
--------------- -----------------
4,242,289 11,882,933
Loans to participants 759,248 759,248
--------------- -----------------
$ 5,001,537 12,642,181
=============== =================
See accompanying independent auditors' report.
6
SMITHWAY MOTOR XPRESS, INC. 401(k)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Schedule 2
Item 27a - Schedule of Assets Held for Investment Purposes
Which Were Both Acquired and Disposed of Within the Plan Year
December 31, 1998 and 1997
1998 - NONE
1997 - NONE
Schedule 3
Item 27b - Schedule of Loans or Fixed Income Obligations
1998 - NONE
1997 - NONE
Schedule 4
Item 27c - Schedule of Leases in Default or Classified as Uncollectible
1998 - NONE
1997 - NONE
See accompanying independent auditors' report.
7
SMITHWAY MOTOR XPRESS, INC. 401(k)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Schedule 5
Item 27d - Schedule of Reportable Transactions
Years ended December 31, 1998 and 1997
1998
----
Purchase Proceeds Gain (loss)
price of from on
Description additions dispositions dispositions
----------- ---------- ------------- ------------
Fidelity Magellan 552,984 769,383 410,260
PBHG Growth 325,772 391,273 141,055
Smithway Motor Xpress Corp. common stock 829,234 1,128,699 648,059
Cash (money market fund) 482,505 288,783 --
Loans to participants 492,777 331,610 --
========== =========== ============
1997
----
Purchase Proceeds Gain (loss)
price of from on
Description additions dispositions dispositions
----------- ----------- ------------ ------------
Fidelity Asset Manager $ 1,182,042 208,056 19,092
Fidelity Magellan 992,913 298,498 100,746
Capital Preservation Fund 112,764 171,005 --
PBHG Growth 73,188 243,893 70,409
Putnam Vista 90,928 117,797 4,298
Strong Government Securities 53,942 89,728 1,273
Smithway Motor Xpress Corp. common stock 596,886 1,223,695 556,645
Loans to participants 762,895 101,545 --
========== =========== ============
Schedule 6
Item 27e - Schedule of Nonexempt Transactions
1998 - NONE
1997 - NONE
See accompanying independent auditors' report.
8
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned hereunto
duly authorized.
SMITHWAY MOTOR XPRESS, INC. 401(k)
RETIREMENT SAVINGS AND INVESTMENT PLAN
Date: June 29, 1999
/s/ Tom Nelson
By:___________________________________
Tom Nelson, Administrator
9