AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 19, 1996

REGISTRATION NO. 333-05293
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 2

TO
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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DYNAMEX INC.
(Exact name of registrant as specified in its charter)

DELAWARE 4215 86-0712225
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)

2630 SKYMARK AVENUE
SUITE 610
MISSISSAUGA, ONTARIO L4W 5A4
(905) 238-6414
(Address, including zip code and telephone number, including area code, of
registrant's principal executive offices)

ROBERT P. CAPPS
VICE PRESIDENT-FINANCE AND CORPORATE DEVELOPMENT
ONE GALLERIA TOWER
13355 NOEL ROAD, SUITE 1650
DALLAS, TEXAS 75240
(214) 960-4859
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
---------------------
Copies To:

CROUCH & HALLETT, L.L.P. SONNENSCHEIN NATH & ROSENTHAL
717 NORTH HARWOOD, SUITE 1400 8000 SEARS TOWER
DALLAS, TEXAS 75201 CHICAGO, ILLINOIS 60606
ATTN: BRUCE H. HALLETT ATTN: MICHAEL M. FROY
(214) 953-0053 (312) 876-8000

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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. / /

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE

============================================================================================================
PROPOSED
PROPOSED MAXIMUM
MAXIMUM AGGREGATE
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(2) PER SHARE(3) PRICE(2)(3) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------

Common Stock, $.01 par value(1)............. 3,565,000 shares $12.00 $42,780,000 $14,752
============================================================================================================

(1) Includes 465,000 shares which the Underwriters have the option to purchase
to cover over-allotments, if any.

(2) Includes associated rights (the "Rights") to purchase one one-hundredth of a
share of Series A Junior Participating Preferred Stock, par value $.01 per
share. Rights initially are attached to and trade with the Common Stock of
the Registrant. The value attributable to such Rights, if any, is reflected
in the offering price of the Common Stock.

(3) Estimated solely for purposes of determining the registration fee pursuant
to Rule 457(o).
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
2

DYNAMEX INC.

Cross-Reference Sheet Pursuant to Item 501(b) of Regulation S-K Showing
Locations in the Prospectus of Information Required by Part I of Form S-1.

REGISTRATION STATEMENT ITEMS AND HEADINGS LOCATION OR CAPTIONS IN PROSPECTUS
------------------------------------------- -------------------------------------------

1. Forepart of the Registration Statement and
Outside Front Cover Page of Prospectus..... Facing Page; Cross Reference Sheet; Outside
Front Cover Page of Prospectus
2. Inside Front and Outside Back Cover Pages
of Prospectus.............................. Inside Front Cover Page of Prospectus;
Additional Information; Outside Back
Cover Page of Prospectus
3. Summary Information, Risk Factors and Ratio
of Earnings to Fixed Charges............... Prospectus Summary; The Company; Risk
Factors
4. Use of Proceeds............................ Use of Proceeds
5. Determination of Offering Price............ Outside Front Cover Page of Prospectus;
Underwriting
6. Dilution................................... Dilution
7. Selling Security Holders................... Not applicable
8. Plan of Distribution....................... Outside Front Cover Page of Prospectus;
Underwriting
9. Description of Securities to be
Registered................................. Prospectus Summary; Risk Factors; Dividend
Policy; Description of Capital Stock;
Shares Eligible for Future Sale
10. Interests of Named Experts and Counsel..... Legal Matters
11. Information with Respect to the
Registrant................................. Prospectus Summary; The Company; Risk
Factors; Dividend Policy;
Capitalization; Selected Consolidated
Financial Data; Pro Forma Financial
Information; Management's Discussion and
Analysis of Financial Condition and
Results of Operations; Business;
Management; Certain Transactions;
Principal Stockholders; Description of
Capital Stock; Shares Eligible for
Future Sale; Financial Statements
12. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities................................ Not applicable

***************************************************************************
* *
* Information contained herein is subject to completion or amendment. A *
* registration statement relating to these securities has been filed *
* with the Securities and Exchange Commission. These securities may not *
* be sold nor may offers to buy be accepted prior to the time the *
* registration statement becomes effective. This prospectus shall not *
* constitute an offer to sell or the solicitation of an offer to buy *
* nor shall there be any sale of these securities in any State in which *
* such offer, solicitation or sale would be unlawful prior to *
* registration or qualification under the securities laws of any such *
* State. *
* *
***************************************************************************

SUBJECT TO COMPLETION, DATED JULY 19, 1996

PROSPECTUS

3,100,000 SHARES

[DYNAMEX LOGO]

COMMON STOCK

All of the shares of Common Stock offered hereby are being sold by Dynamex
Inc. Prior to this Offering, there has been no public market for the Common
Stock of the Company. It is currently estimated that the initial public offering
price will be between $10.00 and $12.00 per share. See "Underwriting" for
information relating to the determination of the initial public offering price.
The Common Stock offered hereby has been approved for quotation and trading on
the Nasdaq National Market under the symbol "DYMX."

SEE "RISK FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SHARES OF COMMON
STOCK OFFERED HEREBY.

---------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

============================================================================================
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1) COMPANY(2)
- --------------------------------------------------------------------------------------------

Per Share......................... $ $ $
Total(3).......................... $ $ $
============================================================================================

(1) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."

(2) Before deducting expenses payable by the Company estimated at $800,000.

(3) The Company has granted to the Underwriters a 30-day option to purchase up
to an additional 465,000 shares of Common Stock solely to cover
over-allotments, if any. See "Underwriting." If all such shares are
purchased, the total Price to Public, Underwriting Discount and Proceeds to
Company will be $ , $ and $ , respectively.

The shares of Common Stock are offered by the several Underwriters when, as
and if delivered to and accepted by them and subject to their right to reject
orders in whole or in part. It is expected that delivery of the certificates for
the shares of Common Stock will be made on or about , 1996.

WILLIAM BLAIR & COMPANY HOAK SECURITIES CORP.

THE DATE OF THIS PROSPECTUS IS , 1996
4

[MAP REPRESENTING COMPANY BRANCHES TO BE INSERTED]

---------------------

The Company intends to distribute to its stockholders annual reports
containing consolidated financial statements audited by an independent public
accounting firm and quarterly reports containing unaudited consolidated
financial information for each of the first three quarters of each fiscal year.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMPANY'S
COMMON STOCK AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NASDAQ NATIONAL MARKET, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.

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5

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial statements, including the notes thereto, appearing
elsewhere in this Prospectus. Unless otherwise indicated, all information herein
(i) assumes no exercise of the Underwriters' over-allotment option and (ii) has
been adjusted to give effect to the 4 for 1 split of Common Stock, par value
$.01 per share (including the associated preferred stock purchase rights, the
"Common Stock") effected on June 3, 1996. See "Description of Capital Stock" and
"Underwriting." References herein to the "Company" or "Dynamex" mean Dynamex
Inc., a Delaware corporation and its subsidiaries unless the context otherwise
requires. References herein to "Dynamex Express" mean the ground courier
operations of Air Canada purchased by the Company in May 1995. References herein
to "Mayne Nickless" mean the on-demand ground courier operations of Mayne
Nickless Incorporated and Mayne Nickless Canada Inc. purchased by the Company in
December 1995.

THE COMPANY

The Company is a leading provider of same-day delivery and logistics
services in the U.S. and Canada. Through internal growth and acquisitions, the
Company has built the only national network of same-day delivery and logistics
systems in Canada and has established operations in 10 U.S. metropolitan areas
from which it intends to build a national network in the U.S. The Company
capitalizes on its routing, dispatch and vehicle management expertise developed
in the ground courier business to provide its customers with a broad range of
value added, same-day distribution and logistics services.

Through its network of branch offices, the Company provides same-day,
door-to-door delivery services utilizing ground couriers for intra-city
deliveries and third party air transportation providers in conjunction with
ground couriers for inter-city deliveries. The Company's same-day delivery
services include both on-demand and scheduled deliveries. On-demand services are
typically unscheduled deliveries of time-sensitive materials and include
deliveries of inventory made on a just-in-time basis from strategic stocking
locations managed by Company personnel. Scheduled distribution services
encompass recurring, often daily, deliveries provided on a point-to-point basis
or deliveries that require intermediate handling, routing or sorting of items to
be delivered to multiple locations. The Company also offers fleet management
services, whereby the Company assumes complete responsibility for providing and
managing a fleet of dedicated vehicles at a customer site. The Company's
on-demand delivery capabilities are available to supplement the scheduled
distribution and dedicated fleets as necessary.

The Company believes that certain industry trends have created significant
growth opportunities for the Company. While historically same-day delivery
service primarily related to downtown document deliveries, technological
developments such as facsimile and electronic mail have increased time
sensitivity in a variety of business transactions, thereby increasing the demand
for the same-day delivery of non-faxable items. Additionally, in an effort to
control costs and focus on primary competencies, many businesses are seeking to
reduce their reliance on in-house transportation departments by turning to third
party experts to provide transportation logistics services. To date, the
same-day delivery and logistics industry has been highly fragmented, and
services have been available primarily on a local basis. The Company believes
that this market fragmentation creates substantial consolidation opportunities
for same-day delivery and logistics companies with national marketing efforts
and operations.

The Company intends to expand its operations in the U.S. and Canada in
order to capitalize on the demand of local, regional and national businesses for
innovative same-day distribution solutions. The key elements of the Company's
business strategy are as follows: (i) increase customer utilization of primary
services at each location, (ii) target national and regional accounts, (iii)
create alliances with strategic partners and (iv) pursue acquisitions of high
quality same-day delivery companies.

3
6

The Company was founded in 1992 as Parcelway Systems Holding Corp. In May
1995, the Company acquired Dynamex Express, the ground courier operations of Air
Canada, which was led by Richard K. McClelland, the Company's Chief Executive
Officer. In July 1995, the Company changed its name to Dynamex Inc. At the time
of its acquisition by the Company, Dynamex Express had developed a national
network of 20 locations across Canada and offered an array of services on a
national, multi-city and local basis. The Company seeks to expand its operations
by implementing and expanding upon the business strategy utilized by Dynamex
Express. In December 1995, the Company acquired the ground courier operations of
Mayne Nickless which had operations in eight U.S. cities and two Canadian
cities. The Company has entered into agreements pursuant to which it will
purchase same-day delivery businesses in New York, New York; Columbus, Ohio;
Chicago, Illinois; Halifax, Nova Scotia; and Winnipeg, Manitoba on or before the
completion of the Offering (collectively, the "Acquisitions"). See
"Business -- Pending Acquisitions."

THE OFFERING

Shares Offered by the Company................ 3,100,000
Shares to be Outstanding after the
Offering................................... 6,309,630(1)
Use of Proceeds.............................. To repay substantially all outstanding
indebtedness and to pay a portion of the
consideration for the Acquisitions. See "Use
of Proceeds."
Proposed Nasdaq National Market Symbol....... DYMX

- ---------------

(1) Excludes 473,384 additional shares of Common Stock reserved for issuance
under the Company's Stock Option Plan, of which 214,384 shares of Common
Stock are issuable upon the exercise of stock options outstanding at a
weighted average exercise price of $3.84 per share and 259,000 shares of
Common Stock which will be issuable upon the exercise of stock options to be
granted in connection with the Offering at an exercise price per share equal
to the initial public offering price. Includes 126,170 shares of Common
Stock to be issued in connection with the Acquisitions (assuming an initial
public offering price of $11.00 per share) and 540,000 shares of Common
Stock to be issued upon the mandatory exercise of the Bridge Warrants at the
time of the Offering. See "Use of Proceeds" and "Management -- Stock Option
Plan."

See "Risk Factors" for a discussion of certain factors that should be
considered by prospective purchasers of the shares of Common Stock offered
hereby.

4
7

SUMMARY FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

YEAR ENDED JULY 31, NINE MONTHS ENDED APRIL 30,
--------------------------------------------- ---------------------------------
PRO FORMA PRO FORMA
1993 1994 1995(1) 1995(2) 1995 1996(1) 1996(2)
------- ------- ------- ------------ ------- ------- ------------

STATEMENT OF OPERATIONS DATA:
Sales.............................. $ 728 $ 7,023 $21,032 $ 99,506 $11,350 $50,015 $ 77,243
Gross profit....................... 309 1,811 6,696 34,004 3,545 14,936 25,619
Operating income (loss)............ (497) (960) (1,062) 3,502 (1,191) 1,479 3,154
Interest expense................... 25 157 403 2,010 240 1,079 1,673
Income (loss) before taxes......... (508) (1,065) (1,622) 1,672 (1,431) 400 1,604
Income taxes....................... -- -- 3 751 -- 11 716
Net income (loss).................. (508) (1,065) (1,625) 921 (1,431) 389 888
Net income (loss) per common
share(3)......................... $ (0.33) $ (0.63) $(0.81) $ 0.22 $(0.85) $ 0.10 $ 0.21
Weighted average common shares
outstanding...................... 1,556 1,691 2,018 4,258 1,679 3,706 4,258
OTHER DATA:
Earnings (loss) before interest,
taxes, depreciation and
amortization(4).................. $ (429) $ (586) $ (529) $ 5,994 $ (682) $2,545 $ 5,100

APRIL 30, 1996,
--------------------------
PRO FORMA
ACTUAL AS ADJUSTED(5)
------- --------------

BALANCE SHEET DATA:
Working capital........................................................................ $ 3,300 $ 8,325
Total assets........................................................................... 32,987 45,409
Long-term debt, excluding current portion.............................................. 18,866 168
Shareholders' equity................................................................... 5,658 37,377

- ---------------

(1) The historical statement of operations data for the year ended July 31, 1995
and for the nine months ended April 30, 1996 include data for (i) Dynamex
Express after May 31, 1995, the effective date of its acquisition by the
Company and (ii) Mayne Nickless after December 28, 1995, the effective date
of its acquisition by the Company.

(2) The pro forma statement of operations data for the year ended July 31, 1995
have been prepared as if the acquisition of Dynamex Express, Mayne Nickless
and the Acquired Companies occurred at the beginning of that period and for
the nine months ended April 30, 1996 as if the acquisition of Mayne Nickless
and the Acquired Companies occurred at the beginning of that period.

(3) See Note 1 of Notes to the Consolidated Financial Statements.

(4) EBITDA is defined as income excluding interest, taxes, depreciation and
amortization of goodwill and other intangible assets (as presented on the
face of the income statement). EBITDA is supplementally presented because
management believes that it is a widely accepted financial indicator of a
company's ability to service and/or incur indebtedness, maintain current
operating levels of fixed assets and acquire additional operations and
businesses. EBITDA should not be considered as a substitute for the
statement of operations or cash flow data from the Company's financial
statements, which have been prepared in accordance with generally accepted
accounting principles. Cash flows provided by (used in) operating activities
for the three years ended July 31, 1995 and for the nine months ended April
30, 1995 and 1996 were ($636), ($980), ($944), $335 and $1,838,
respectively. Cash flows used in investing activities for the three years
ended July 31, 1995 and for the nine months ended April 30, 1995 and 1996
were $387, $2,251, $7,995, $194 and $12,724, respectively. Cash flows
provided by (used in) financing activities for the three years ended July
31, 1995 and for the nine months ended April 30, 1995 and 1996 were $624,
$3,964, $8,580, ($944) and $10,896, respectively.

(5) The pro forma as adjusted balance sheet data have been prepared as if the
Acquisitions and the Offering had occurred as of April 30, 1996 and reflect
the issuance of the shares offered by the Company hereby, the application by
the Company of the net proceeds therefrom, the issuance of shares in
connection with the Acquisitions and the mandatory exercise of the Bridge
Warrants at the time of the Offering. See "Use of Proceeds."

The principal executive offices of the Company are located at 2630 Skymark
Avenue, Suite 610, Mississauga, Ontario L4W 5A4 and its telephone number is
(905) 238-6414. The Company intends to move its principal executive offices to
Dallas, Texas within the next 18 months.

5
8

RISK FACTORS

Prospective investors should carefully review the following risk factors
together with the other information in this Prospectus in evaluating the Company
and its business prior to purchasing the Common Stock offered by this
Prospectus.

ACQUISITION STRATEGY; POSSIBLE NEED FOR ADDITIONAL FINANCING

In order to expand its network of facilities, the Company plans to acquire
local delivery businesses in new geographic regions and in the metropolitan
areas where the Company currently operates. Due to consolidation within the
same-day delivery and logistics industry, there is significant competition in
acquiring such businesses. There can be no assurance that the Company will be
able to acquire or profitably manage additional companies or successfully
integrate their operations into the Company. In addition, there can be no
assurance that companies acquired in the future either will be beneficial to the
successful implementation of the Company's overall strategy or will ultimately
produce returns that justify the investment therein, or that the Company will be
successful in achieving meaningful economies of scale through the acquisition
thereof. See "Business -- Business Strategy" and "-- Pending Acquisitions."

The Company's acquisition strategy may require the Company to incur
additional debt in the future, may result in potentially dilutive issuances of
securities and may result in increased goodwill, intangible assets and
amortization expense. There can be no assurance that the Company's primary
lender will consent to acquisitions above a certain annual dollar threshold set
forth in the Company's credit facility or that, if additional financing is
necessary, it can be obtained on terms the Company deems acceptable. As a
result, the Company might be unable to successfully implement its acquisition
strategy. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Liquidity and Capital Resources."

LIMITED COMBINED OPERATING HISTORY; HISTORY OF LOSSES

Recent acquisitions have greatly expanded the size and scope of the
operations of the Company. Additionally, the Company proposes to complete the
Acquisitions simultaneously with the closing of the Offering. The process of
integrating acquired businesses often involves unforeseen difficulties and may
require a disproportionate amount of the Company's financial and other
resources, including management time. There can be no assurance that the Company
will be able to profitably manage recently acquired companies or successfully
integrate their operations into the Company. For the years ended July 31, 1993,
1994, and 1995, the Company incurred actual net losses of approximately
$508,000, $1.1 million and $1.6 million, respectively. No assurances can be
given that the Company will operate profitably in the future. As of April 30,
1996, the Company had an accumulated deficit of approximately $3.7 million. See
"Selected Consolidated Financial Data" and "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

COMPETITION

The market for same-day delivery and logistics services has been and is
expected to remain highly competitive. Competition is often intense,
particularly for basic delivery services. The industry is highly fragmented with
low barriers to entry, and there is a recent trend toward consolidation. Other
companies in the industry compete with the Company not only for provision of
services but also for acquisition candidates. Some of these companies have
longer operating histories and greater financial and other resources than the
Company. Additionally, companies that do not currently operate delivery and
logistics businesses may enter the industry in the future. See
"Business -- Competition."

CLAIMS EXPOSURE

The Company utilizes the services of approximately 2,300 drivers, and from
time to time such drivers are involved in accidents or other activities that may
give rise to liability claims. The Company currently carries liability insurance
with an aggregate limit of $15.0 million, and independent owner/operators are
required to maintain liability insurance of at least the minimum amounts
required by applicable state or provincial law.

6
9

The Company also has insurance policies covering property and fiduciary trust
liability, which coverage includes all drivers. There can be no assurance that
claims against the Company, whether under the liability insurance or the surety
bonds, will not exceed the applicable amount of coverage, that the Company's
insurer will be solvent at the time of settlement of an insured claim, or that
the Company will be able to obtain insurance at acceptable levels and costs in
the future. In addition, the Company's increased visibility and financial
strength as a public company may create additional claims exposure. If the
Company were to experience a material increase in the frequency or severity of
accidents, liability claims, workers' compensation claims, or unfavorable
resolutions of claims, the Company's business, financial condition and results
of operations could be materially and adversely affected. In addition,
significant increases in insurance costs could adversely affect the Company's
profitability. See "Business -- Safety."

CERTAIN TAX MATTERS RELATED TO DRIVERS

The Company uses independent owner/operators as drivers in a significant
portion of its operations. As of April 30, 1996, approximately 83% of the
Company's drivers were independent owner/operators. From time to time, taxing
authorities in the U.S. and Canada have sought to assert that independent
owner/operators in the transportation industry, including those utilized by the
Company, are employees rather than independent contractors. The Company believes
that the independent owner/operators utilized by the Company are not employees
under existing interpretations of federal (U.S. and Canadian), state and
provincial laws. However, there can be no assurance that federal, state or
provincial authorities will not challenge this position, or that other laws or
regulations, including tax laws, or interpretations thereof, will not change.
If, as a result of any of the foregoing, the Company is required to pay for and
administer added benefits to independent owner/operators, the Company's
operating costs would increase. Additionally, if the Company is required to pay
back-up withholding with respect to amounts previously paid to such persons, it
may be required to pay penalties which could have a material adverse impact on
the Company's financial condition and results of operations. See
"Business -- Services" and "-- Employees."

In addition, certain of the Company's drivers are employed by the Company
and own and operate the vehicles used during the course of their employment. The
Company reimburses these employees for all or a portion of the operating costs
of those vehicles. The Company believes that these reimbursement arrangements do
not represent additional compensation to those employees. However, there can be
no assurance that federal (U.S. and Canadian), state or provincial taxing
authorities will not seek to recharacterize some or all of such payments as
additional compensation. If such amounts were so recharacterized, the Company
would have to pay additional employment related taxes on such amounts.

FOREIGN EXCHANGE

A significant portion of the Company's operations are conducted in Canada.
Exchange rate fluctuations between the U.S. and Canadian dollar result in
fluctuations in the amounts relating to the Canadian operations reported in the
Company's consolidated financial statements. The Company historically has not
entered into hedging transactions with respect to its foreign currency exposure.
There can be no assurance that fluctuations in foreign currency exchange rates
will not have a material adverse effect on the Company's business, financial
condition or results of operations. See Note 8 of Notes to the Consolidated
Financial Statements.

PERMITS AND LICENSING

Although recent legislation has significantly deregulated certain aspects
of the transportation industry, the Company's delivery operations are still
subject to various federal, state, provincial and local laws, ordinances and
regulations that in many instances require certificates, permits and licenses.
Failure by the Company to maintain required certificates, permits or licenses,
or to comply with applicable laws, ordinances or regulations could result in
substantial fines or possible revocation of the Company's authority to conduct
certain of its operations. Delays in obtaining approvals for the transfer or
grant of certificates, permits or licenses, or failure to obtain same, could
impede the implementation of the Company's acquisition program. See "Business --
Regulation."

7
10

DEPENDENCE ON KEY PERSONNEL

The Company's success is largely dependent on the skills, experience and
performance of certain key members of its management, including particularly
Richard K. McClelland, the Company's Chief Executive Officer. The loss of the
services of any of these key employees could have a material adverse effect on
the Company's business, financial condition and results of operations. The
Company has entered into an employment contract with Mr. McClelland. The
Company's future success and plans for growth also depend on its ability to
attract, train and retain skilled personnel in all areas of its business. There
is strong competition for skilled personnel in the same-day delivery and
logistics business. See "Management."

EFFECTIVE CONTROL BY CYPRESS CAPITAL PARTNERS I, L.P. AND AFFILIATES

Upon completion of the Offering, Cypress Capital Partners I, L.P., a
Dallas-based private investment partnership ("Cypress"), and certain of its
affiliates, including James M. Hoak, the sole stockholder of the general partner
of Cypress, will directly and indirectly own an aggregate of 2,356,552 shares of
Common Stock, or approximately 37% of the total voting power of the Company (or
35% of the total voting power of the Company if the over-allotment option is
exercised in full). Accordingly, Cypress and its affiliates will be in a
position to exercise substantial influence over actions that require consent of
stockholders, including decisions relating to the election of directors of the
Company, mergers and consolidations. See "Principal Stockholders," "Certain
Transactions" and "Underwriting."

TECHNOLOGY

Technological advances in the nature of facsimile and electronic mail have
affected the market for on-demand document delivery services. While these
technological developments have not had a significant adverse impact on the
Company's business to date, and although the Company has shifted its focus to
the distribution of non-faxable items and logistics services, there can be no
assurance that these or other technologies will not have a material adverse
effect on the Company's business, financial condition and results of operations
in the future.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Offering, the Company will have outstanding
6,309,630 shares of Common Stock. As part of the consideration for the
Acquisitions, the Company has agreed to issue to certain owners of the Acquired
Companies an aggregate of 126,170 shares of Common Stock (assuming an initial
public offering price of $11.00 per share) and has agreed to register such
shares under the Securities Act of 1933, as amended (the "Securities Act"),
within 30 days after the closing of the Acquisitions in order to permit the
resale of such shares in the open market from time to time, subject to the
lockup period described below. The Company has agreed to maintain the
effectiveness of such registration for two years. In addition, 3,083,460 shares
previously issued by the Company (including 540,000 shares to be issued upon the
mandatory exercise of the Bridge Warrants) will be eligible for resale after the
Offering subject to the provisions of Rule 144 under the Securities Act and the
lockup period described below. Further, 473,384 shares of Common Stock will be
issuable upon exercise of outstanding options and options to be granted in
connection with the Offering, 110,754 of which are immediately exercisable
(subject to the lockup period described below which affects 105,954 of such
shares) and 362,630 of which vest over a five-year period. The Company, the
Company's executive officers and directors, previous owners of the companies to
be acquired in the Acquisitions to whom shares of Common Stock are being issued
in connection therewith and stockholders of the Company that own 1% or more of
the Common Stock outstanding prior to the Offering have agreed not to offer,
sell, contract to sell or otherwise dispose of any shares of Common Stock or any
securities exercisable for or convertible into Common Stock for a period of 180
days after the date of this Prospectus without the prior written consent of
William Blair & Company, L.L.C. Pursuant to a registration rights agreement with
the Company, Cypress may require the Company after the six month anniversary of
the Offering to file a registration statement under the Securities Act with
respect to its shares of Common Stock, and subject to certain limitations,
certain other principal stockholders of the Company are entitled to include
their shares of Common Stock therein.

8
11

No predictions can be made as to the effect, if any, that market sales of
such shares will have on the market price of shares of Common Stock prevailing
from time to time. However, sales of substantial amounts of Common Stock in the
open market or the availability of such shares for sale following the Offering
could adversely affect the market price for the Common Stock. See "Shares
Eligible for Future Sale," "Description of Capital Stock" and "Principal
Stockholders."

ABSENCE OF PREVIOUS MARKET

Prior to the Offering, there has been no public market for any class of
stock of the Company. Consequently, the initial public offering price has been
determined by negotiations among the Company and the Representatives of the
Underwriters and may not necessarily be indicative of the market price of the
Common Stock after the Offering. No assurance can be given that an active public
trading market for the Common Stock will develop or be sustained, or as to the
price at which the Common Stock will trade if and when it is issued. See
"Underwriting."

POSSIBLE VOLATILITY OF STOCK PRICE

Prices for the Common Stock will be determined in the marketplace and may
be influenced by many factors, including the depth and liquidity of the market
for the Common Stock, investor perception of the Company, and general economic
and market conditions. Variations in the Company's operating results, general
trends in the industry and other factors could cause the market price of the
Common Stock to fluctuate significantly. In addition, general trends and
developments in the industry, government regulation and other factors could have
a significant impact on the price of the Common Stock. The stock market has, on
occasion, experienced extreme price and volume fluctuations that have often
particularly affected market prices for smaller companies and that often have
been unrelated or disproportionate to the operating performance of the affected
companies, and the price of the Common Stock could be affected by such
fluctuations.

DILUTION

Purchasers of Common Stock in the Offering will experience immediate and
substantial dilution in the net tangible book value per share of Common Stock of
$8.92 (assuming an initial public offering price of $11.00 per share). See
"Dilution."

ANTI-TAKEOVER PROVISIONS

Certain provisions of the Company's Restated Certificate of Incorporation
(the "Restated Certificate of Incorporation"), the Company's Bylaws (the
"Bylaws") and the Rights Agreement between the Company and Harris Trust and
Savings Bank (the "Rights Agreement") may delay, defer, discourage or prevent a
merger, proxy contest, tender offer or takeover attempt that a stockholder might
consider to be in such stockholder's best interest, including attempts that
might result in a premium over the market price for the shares held by
stockholders.

The Bylaws provide that the number of directors shall be fixed, from time
to time, by resolution of the Board of Directors of the Company. Neither the
Bylaws nor the Restated Certificate of Incorporation permit stockholders to call
special meetings or to take actions by written consent in lieu of a meeting,
unless such action and the taking of such action by written consent have been
approved in advance by the Board of Directors. The Restated Certificate of
Incorporation provides that the Board of Directors may amend the Bylaws, subject
to the rights of the stockholders to amend such Bylaws. An amendment to the
provision of the Restated Certificate of Incorporation which prohibits action by
stockholders by written consent in lieu of a meeting requires the affirmative
vote of two-thirds of the Company's capital stock then outstanding. Pursuant to
the Restated Certificate of Incorporation, additional shares of Common Stock may
be issued in the future without further stockholder approval. Furthermore, the
Restated Certificate of Incorporation permits the Board of Directors to
establish by resolution one or more series of preferred stock ("Preferred
Stock") and to establish the powers, designations, preferences and relative,
participating, optional or other special rights of

9
12

each series of Preferred Stock. The Preferred Stock could be issued on terms
that are unfavorable to the holders of Common Stock or that could make a
takeover or change in control of the Company more difficult.

In June 1996, the Board of Directors of the Company approved the Rights
Agreement which is designed to protect stockholders should the Company become a
target of coercive and unfair takeover tactics but may discourage takeover
attempts that are not approved by the Board of Directors. The Rights could cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on redemption of the Rights or on substantially
all of the Rights also being acquired. In addition, immediately following the
Offering, the Company will be subject to Section 203 of the Delaware General
Corporation Law, which places restrictions on certain business combinations with
certain stockholders that could render more difficult a change in control of the
Company. See "Description of Capital Stock."

NO DIVIDENDS

The Company has not declared or paid any cash dividends on its Common Stock
since its inception. The Company currently intends to retain all earnings for
the operation and expansion of its business and does not anticipate paying any
dividends in the foreseeable future. In addition, the Company's credit agreement
restricts the payment of dividends. See "Dividend Policy" and Note 5 of Notes to
the Consolidated Financial Statements.

10
13

THE COMPANY

History. The Company was founded in 1992 as Parcelway Systems Holding Corp.
In November 1993, Cypress acquired a controlling interest in the Company with
the purpose of building a national same-day delivery and logistics company.
During 1993 and 1994, the Company completed acquisitions of same-day delivery
companies with operations in Phoenix, Arizona; Chicago, Illinois; Los Angeles,
California; and Western Canada. In May 1995, the Company acquired Dynamex
Express and subsequently changed the Company's name to Dynamex Inc. At the time
of its acquisition, Dynamex Express had developed a national network of same-day
delivery and logistics services in Canada and had operations in 20 Canadian
cities. In December 1995, the Company significantly expanded the scope of its
U.S. operations by acquiring the same-day, on-demand delivery business of Mayne
Nickless which had facilities in eight major metropolitan areas in the U.S. and
two metropolitan areas in Canada.

Pending Acquisitions. The Company has entered into agreements
(collectively, the "Acquisition Agreements"), pursuant to which it will
purchase, on or before the completion of the Offering, the same-day delivery
businesses of (i) Action Delivery and Messenger Service Limited ("Action
Delivery"), (ii) Seidel Enterprises, Inc. and a related company (together,
"Seidel Delivery"), (iii) Seko Enterprises, Inc. and related companies
(together, "Seko/Metro"), (iv) Southbank Courier, Inc. ("Southbank") and (v)
Zipper Transportation Services, Ltd. ("Zipper"; and collectively with Action
Delivery, Seidel Delivery, Southbank and Seko/Metro, the "Acquired Companies").
As consideration for the stock of the Acquired Companies, the stockholders of
the Acquired Companies will receive an aggregate of approximately $7.2 million
in cash and approximately 126,170 shares of Common Stock (assuming an initial
public offering price of $11.00 per share) and the Company will repay an
aggregate amount of approximately $840,000 of the Acquired Companies'
indebtedness.

Certain information regarding each of the Acquired Companies is summarized
below:

TWELVE MONTHS ENDED
YEAR DECEMBER 31, 1995 METROPOLITAN
ACQUIRED COMPANY ESTABLISHED SALES AREAS SERVED
- ---------------- ----------- ------------------- -------------------

Halifax, Nova
Action Delivery 1973 $ 2.3 million(1) Scotia
Seidel Delivery 1988 1.8 million Columbus, Ohio
Seko/Metro 1954 8.5 million Chicago, Illinois
Southbank 1992 2.0 million New York, New York
Zipper 1974 6.3 million(1) Winnipeg, Manitoba
-------------------
$20.9 million

- ---------------

(1) Amounts have been converted from Canadian dollars to U.S. dollars using an
exchange rate of 0.73 U.S. dollars to 1.00 Canadian dollars.

11
14

USE OF PROCEEDS

The net proceeds to be received by the Company from the sale of 3,100,000
shares of Common Stock in the Offering are estimated to be approximately $30.9
million (assuming an initial public offering price of $11.00 per share) and
after deducting the underwriting discount and estimated offering expenses.

The Company will apply approximately $8.4 million of the net proceeds of
the Offering to pay (i) the cash portion of the consideration payable in
connection with the Acquisitions, including repayment of assumed debt of
$840,000 and (ii) the estimated transaction costs to effect the Acquisitions of
$400,000. See "Business -- Pending Acquisitions" and "Pro Forma Financial
Information."

The Company will apply approximately $19.9 million of the net proceeds of
the Offering to repay indebtedness outstanding as of June 30, 1996 of (i) term
bank indebtedness (approximately $13.0 million principal amount), (ii)
indebtedness to Air Canada (approximately Cdn $3.2 million principal amount
(approximately $2.4 million, as converted using an exchange rate of 0.73 U.S.
dollars to 1.00 Canadian dollars)), and (iii) indebtedness under the Bridge
Notes, as defined below ($4.5 million principal amount). The Company's bank
indebtedness was incurred under a Credit Agreement, dated as of December 15,
1995 (as amended and restated, the "Credit Agreement"), and bears interest at a
variable rate (9.5% as of June 30, 1996). Such indebtedness, the substantial
portion of which matures in installments through March 2001, was incurred
principally for the purpose of providing financing for the acquisition of Mayne
Nickless and refinancing the indebtedness incurred by the Company in its prior
acquisitions. The Company's indebtedness to Air Canada is due on March 28, 2002
and bears interest at an annual rate of 10%. This indebtedness was incurred in
connection with the Company's acquisition of Dynamex Express and was refinanced
in connection with the Company's acquisition of Mayne Nickless. The bridge
facility consists of $4.5 million (approximately $3.9 million carrying value) of
junior subordinated debentures (the "Bridge Notes") due June 28, 2001, bearing
interest at an initial annual rate of 12%, and related warrants (the "Bridge
Warrants") to purchase 540,000 shares of Common Stock at $.025 per share which
are mandatorily exercisable upon the completion of the Offering. The Bridge
Notes and Bridge Warrants were purchased by Cypress, various limited partners of
Cypress and certain affiliates of Cypress' general partner in connection with
the acquisition of Mayne Nickless. See Note 5 of Notes to the Consolidated
Financial Statements and "Certain Transactions."

The remaining balance of the net proceeds of the Offering (approximately
$2.6 million) will be used to reduce the revolving note under the Credit
Agreement (approximately $1.1 million principal amount which bears interest at a
variable rate, 9.25% as of June 30, 1996) and for general corporate purposes,
including working capital and potential future acquisitions. While the Company
does not have any commitments with respect to any future acquisitions other than
the Acquisitions, the Company is in the process of evaluating and holding
preliminary discussions with potential acquisition candidates in conjunction
with its acquisition program.

Pending the uses set forth above, the net proceeds of the Offering will be
invested in short-term, interest bearing, investment-grade securities.

DIVIDEND POLICY

The Company has not declared or paid any cash dividends on its Common Stock
since its inception. The Company currently intends to retain all earnings for
the operation and expansion of its business and does not anticipate paying any
dividends in the foreseeable future. In addition, the Credit Agreement restricts
the payment of dividends. See Note 5 of Notes to the Consolidated Financial
Statements.

12
15

CAPITALIZATION

The following table sets forth the consolidated current portion of
long-term debt and capitalization of the Company (i) as of April 30, 1996 and
(ii) after giving pro forma effect to the consummation of the Acquisitions and
the issuance of 126,170 shares of Common Stock in connection therewith (assuming
an initial public offering price of $11.00 per share), as adjusted to reflect
(a) the sale by the Company of 3,100,000 shares of Common Stock offered hereby
at an assumed initial public offering price of $11.00 per share (after deduction
of the underwriting discount and estimated offering expenses) and the
application of the net proceeds therefrom as described under "Use of Proceeds"
and (b) the Company's issuance of 540,000 shares of Common Stock upon the
mandatory exercise of the Bridge Warrants. This table should be read in
conjunction with the pro forma financial information and the Company's financial
statements, including the notes thereto, appearing elsewhere in this Prospectus.

APRIL 30, 1996
-----------------------
PRO FORMA
ACTUAL AS ADJUSTED
------- -----------
(IN THOUSANDS)

Current portion of long-term debt.............................. $ 2,044 $ 144
======= =======
Long-term debt and capital leases, excluding current portion... $18,866 $ 168
------- -------
Shareholders' equity:
Preferred Stock, $.01 par value 10,000,000 shares authorized,
no shares issued.......................................... -- --
Warrants to purchase Common Stock............................ 624 --
Common Stock, $.01 par value, 50,000,000 shares authorized;
2,543,460 shares issued, 6,309,630 shares issued pro forma
as adjusted(1)............................................ 25 63
Additional paid-in capital................................... 8,756 41,657
Accumulated deficit(2)....................................... (3,749) (4,345)
Unrealized foreign currency translation adjustment........... 2 2
------- -------
Total shareholders' equity................................ 5,658 37,377
------- -------
Total capitalization................................. $24,524 $37,544
======= =======

- ---------------

(2) The Company will incur an extraordinary loss in connection with the
redemption of the Bridge Notes in the amount of the difference between the
carrying value and the principal amount of the Bridge Notes as of April 30,
1996. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."

13
16

DILUTION

The net tangible book value of the Company's Common Stock as of April 30,
1996 was a deficit of approximately $12.2 million, or approximately $4.80 per
share, based upon 2,543,460 shares of Common Stock outstanding at such date.
"Pro forma, as adjusted net tangible book value per share" is determined by
dividing the pro forma, as adjusted net tangible book value by the number of
shares of Common Stock assumed to be outstanding. After giving effect to (i) the
mandatory exercise of the Bridge Warrants, (ii) the completion of the
Acquisitions, including the issuance of 126,170 shares (at an assumed initial
public offering price of $11.00 per share) as partial consideration therefor,
and (iii) the sale by the Company in the Offering of 3,100,000 shares of Common
Stock at an assumed initial public offering price of $11.00 per share (resulting
in net proceeds of approximately $30.9 million after deducting the underwriting
discount and estimated expenses of the Offering) the pro forma, as adjusted, net
tangible book value of the Company as of April 30, 1996 would have been
approximately $13.1 million, or approximately $2.08 per share. This represents
an immediate dilution of $8.92 per share to new investors. The following table
illustrates this per share dilution:

Assumed initial public offering price per share.................... $11.00
------
Net tangible book value deficit per share........................ $(4.80)
Increase per share attributable to the Acquisitions.............. 0.38
Decrease per share attributable to the exercise of the Bridge
Warrants...................................................... (0.19)
Increase per share attributable to the Offering.................. 6.69
------
Pro forma, as adjusted net tangible book value per share after the
Offering......................................................... 2.08
------
Dilution per share to new investors................................ $ 8.92
======

The following table summarizes on a pro forma, as adjusted basis as of
April 30, 1996 the total number of shares of Common Stock purchased from the
Company, the total consideration paid and the average price per share paid by
existing stockholders (giving effect to the adjustments as set forth above) and
by the new investors who purchase shares of Common Stock pursuant to the
Offering at an assumed initial public offering price of $11.00 per share.

SHARES PURCHASED TOTAL CONSIDERATION
-------------------- ---------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
--------- ------- ----------- ------- -------------

Existing stockholders(1)........ 3,209,630 50.9% $10,806,000 24.1% $ 3.37
New investors................... 3,100,000 49.1 34,100,000 75.9 11.00
--------- ----- ----------- -----
Total................. 6,309,630 100.0% $44,906,000 100.0%
========= ===== =========== =====

- ---------------

(1) Excludes 473,384 additional shares of Common Stock reserved for issuance
under the Company's Stock Option Plan, of which 214,384 shares of Common
Stock are issuable upon exercise of stock options outstanding at a weighted
average exercise price of $3.84 per share and 259,000 shares of Common
Stock which will be issuable upon exercise of stock options to be granted
in connection with the Offering at an exercise price per share equal to the
initial public offering price. Includes 126,170 shares of Common Stock to
be issued in connection with the Acquisitions and 540,000 shares of Common
Stock to be issued upon the mandatory exercise of the Bridge Warrants upon
the completion of the Offering. See "Use of Proceeds" and
"Management -- Stock Option Plan."

14
17

SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The following selected historical financial data for the three years ended
July 31, 1995 and the nine months ended April 30, 1996 have been derived from
the audited consolidated financial statements of the Company appearing elsewhere
herein. The following selected historical financial data for the year ended July
31, 1992 have been derived from the consolidated financial statements of the
Company not appearing elsewhere herein. The selected historical financial data
for the nine months ended April 30, 1995, have been derived from the unaudited
consolidated financial statements, appearing elsewhere herein. The unaudited
consolidated financial statements, in the opinion of management, include all
adjustments, consisting of normal recurring accruals, which the Company
considers necessary for a fair presentation of the results of operations for
that period. Operating results for the nine months ended April 30, 1996 are not
necessarily indicative of the results that may be expected for the entire fiscal
year ending July 31, 1996. The following selected pro forma financial data for
the year ended July 31, 1995, for the nine months ended April 30, 1996, and as
adjusted as of April 30, 1996 have been derived from the unaudited pro forma
financial information appearing elsewhere herein. The selected financial data
are qualified in their entirety, and should be read in conjunction with, the
Company's financial statements, including the notes thereto, "Pro Forma
Financial Information" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" appearing elsewhere herein.

YEAR ENDED JULY 31, NINE MONTHS ENDED APRIL 30,
---------------------------------------------------- -------------------------------
PRO FORMA PRO FORMA
1992(1) 1993 1994 1995(2) 1995(3) 1995 1996(2) 1996(3)
------- ------ ------- ------- --------- ------- ------- ---------

STATEMENT OF OPERATIONS DATA:
Sales................................. $ 219 $ 728 $ 7,023 $21,032 $99,506 $11,350 $50,015 $77,243
Cost of sales......................... 148 419 5,212 14,336 65,502 7,805 35,079 51,624
------ ------ ------- ------ ------- ------ ------- -------
Gross profit........................ 71 309 1,811 6,696 34,004 3,545 14,936 25,619
Selling, general and administrative
expenses............................ 226 752 2,449 7,068 28,190 4,227 12,391 20,642
Depreciation and amortization......... 25 54 322 690 2,312 509 1,066 1,823
------ ------ ------- ------ ------- ------ ------- -------
Operating income (loss)............. (180) (497) (960) (1,062) 3,502 (1,191) 1,479 3,154
Interest expense...................... 16 25 157 403 2,010 240 1,079 1,673
Other (income) expense................ (5) (14) (52) 157 (180) -- -- (123)
------ ------ ------- ------ ------- ------ ------- -------
Income (loss) before taxes.......... (191) (508) (1,065) (1,622) 1,672 (1,431) 400 1,604
Income taxes.......................... -- -- -- 3 751 -- 11 716
------ ------ ------- ------ ------- ------ ------- -------
Net income (loss)................... $ (191) $ (508) $(1,065) $(1,62) $ 921 $(1,43) $ 389 $ 888
====== ====== ======= ====== ======= ====== ======= =======
Net income (loss) per common
share(4)............................ $(0.12) $(0.33) $ (0.63) $(0.81) $ 0.22 $(0.85) $ 0.10 $ 0.21
====== ====== ======= ====== ======= ====== ======= =======
Weighted average common shares
outstanding......................... 1,556 1,556 1,691 2,018 4,258 1,679 3,706 4,258
====== ====== ======= ====== ======= ====== ======= =======
OTHER DATA:
Earnings (loss) before interest,
taxes, depreciation and
amortization(5)..................... $ (150) $ (429) $ (586) $ (529) $ 5,994 $ (682) $ 2,545 $ 5,100

APRIL 30, 1996
JULY 31, -------------------------
----------------------------------- PRO FORMA
1992 1993 1994 1995 ACTUAL AS ADJUSTED(6)
---- ------ ------ ------- ------- --------------

BALANCE SHEET DATA:
Working capital.............................................. $380 $ 36 $ 638 $ 1,484 $ 3,300 $ 8,325
Total assets................................................. 599 1,286 8,134 17,194 32,987 45,409
Long-term debt, excluding current portion.................... -- 1,037 1,999 5,924 18,866 168
Shareholders' equity (deficit)............................... 410 (106) 3,389 4,650 5,658 37,377

- ---------------

(1) Represents results for the fourteen months ended July 31, 1992. The
Company's predecessors began operations in June 1991.

(2) The historical statement of operations data for the year ended July 31, 1995
and for the nine months ended April 30, 1996 include data for (i) Dynamex
Express after May 31, 1995, the effective date of its acquisition by the
Company and (ii) Mayne Nickless after December 28, 1995, the effective date
of its acquisition by the Company.

(3) The pro forma statement of operations data for the year ended July 31, 1995
have been prepared as if the acquisition of Dynamex Express, Mayne Nickless
and the Acquired Companies occurred at the beginning of that period and for
the nine months ended April 30, 1996 as if the acquisition of Mayne Nickless
and the Acquired Companies occurred at the beginning of that period.

(4) See Note 1 of Notes to the Consolidated Financial Statements.

(5) EBITDA is defined as income excluding interest, taxes, depreciation and
amortization of goodwill and other assets (as presented on the face of the
income statement). EBITDA is supplementally presented because management
believes that it is a widely accepted financial indicator of a company's
ability to service and/or incur indebtedness, maintain current operating
levels of fixed assets and acquire additional operations and businesses.
EBITDA should not be considered as a substitute for statement of operations
or cash flow data from the Company's financial statements, which have been
prepared in accordance with generally accepted accounting principles. Cash
flows provided by (used in) operating activities for the three years ended
July 31, 1995 and for the nine months ended April 30, 1995 and 1996 were
($636), ($980), ($944), $335 and $1,838, respectively. Cash flows used in
investing activities for the three years ended July 31, 1995 and for the
nine months ended April 30, 1995 and 1996 were $387, $2,251, $7,995, $194
and $12,724, respectively. Cash flows provided by (used in) financing
activities for the three years ended July 31, 1995 and for the nine months
ended April 30, 1995 and 1996 were $624, $3,964, $8,580, ($944) and $10,896,
respectively.

(6) The pro forma as adjusted balance sheet data have been prepared as if the
Acquisitions and the Offering had occurred as of April 30, 1996 and reflect
the issuance of the shares offered by the Company hereby, the application by
the Company of the net proceeds therefrom, the issuance of shares in
connection with the Acquisitions and the mandatory exercise of the Bridge
Warrants at the time of the Offering. See "Use of Proceeds."

15
18

PRO FORMA FINANCIAL INFORMATION

The following unaudited pro forma consolidated condensed financial
information consists of an Unaudited Pro Forma Consolidated Condensed Balance
Sheet as of April 30, 1996 and the Unaudited Pro Forma Consolidated Condensed
Statements of Operations for the year ended July 31, 1995 and the nine months
ended April 30, 1996 (collectively the "Pro Forma Statements"). The Unaudited
Pro Forma Consolidated Condensed Balance Sheet as of April 30, 1996 gives effect
to the Acquisitions as if they had occurred on April 30, 1996, including the
issuance of 126,170 shares of Common Stock to the previous owners of the
Acquired Companies and the issuance of 825,000 shares of Common Stock pursuant
to the Offering (which amount is sufficient to fund the cash portion of the
purchase price, including costs related thereto, of $8.4 million). The Unaudited
Pro Forma As Adjusted Consolidated Condensed Balance Sheet as of April 30, 1996
gives additional effect to the issuance of the balance of shares of Common Stock
being issued in connection with the Offering, the application of the proceeds
thereof and the mandatory exercise of the Bridge Warrants simultaneously
therewith. The Unaudited Pro Forma Consolidated Condensed Statements of
Operations give effect to the acquisitions of Dynamex Express, Mayne Nickless
and the Acquired Companies, including the issuance of 126,170 and 825,000 shares
of Common Stock as described above, as if all such acquisitions had occurred as
of the beginning of those respective periods.

Each of the Acquisitions will be accounted for utilizing the purchase
method of accounting. The purchase price has been allocated in the Pro Forma
Statements to the assets to be acquired and the liabilities to be assumed on a
preliminary basis based on the Company's estimates of their fair values.

Unaudited pro forma adjustments are based upon historical information,
preliminary estimates and certain assumptions that the Company deems
appropriate. The unaudited pro forma condensed financial information presented
herein is not necessarily indicative of the results of the Company that would
have been obtained had such events occurred at the beginning of the period, as
assumed, or of the future results of the Company. The Pro Forma Statements
should be read in conjunction with the other financial statements and notes
thereto appearing elsewhere in this Prospectus.

16
19

UNAUDITED PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
APRIL 30, 1996
(IN THOUSANDS)

ACQUIRED
COMPANIES THE COMPANY
PRO FORMA THE COMPANY PRO FORMA
THE COMPANY COMBINED PRO FORMA PRO FORMA OFFERING AS ADJUSTED
APRIL 30, 1996 MARCH 31, 1996 ADJUSTMENTS APRIL 30, 1996 ADJUSTMENTS APRIL 30, 1996
-------------- -------------- ------------ -------------- ------------ --------------

Cash and temporary
investments................ $ 516 $ 87 $(7,600)(a) $ 603 $ 22,473 (e) $ 1,896
8,440 (c) (21,194)(f)
(840)(d) 14 (g)
Accounts receivable.......... 10,768 2,629 13,397 13,397
Other current assets......... 479 417 896 896
------- ------ ------- ------- -------- -------
11,763 3,133 -- 14,896 1,293 16,189
Furniture, fixtures and
equipment, net............. 1,990 1,463 3,453 3,453
Intangible assets............ 17,867 307 6,091 (b) 24,265 24,265
Other assets................. 1,367 135 1,502 1,502
------- ------ ------- ------- -------- -------
$32,987 $5,038 $ 6,091 $44,116 $ 1,293 $45,409
======= ====== ======= ======= ======== =======
Current liabilities.......... $ 8,463 $1,946 (645)(d) $ 9,764 $ (1,900)(f) $ 7,864
Long-term debt............... 18,866 195 (195)(d) 18,866 (18,698)(f) 168
Shareholders' equity......... 5,658 2,897 8,988 (a) 15,486 22,473 (e) 37,377
(2,897)(b) (596)(f)
840 (c) 14 (g)
------- ------ ------- ------- -------- -------
$32,987 $5,038 $ 6,091 $44,116 $ 1,293 $45,409
======= ====== ======= ======= ======== =======

The accompanying Notes to Unaudited Pro Forma Consolidated Condensed Financial
Statements are an integral part of these statements.

17
20

UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED JULY 31, 1995
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ACQUIRED
COMPANIES
DYNAMEX MAYNE PRO FORMA
EXPRESS NICKLESS COMBINED THE COMPANY
THE COMPANY TEN MONTHS FISCAL YEAR TWELVE MONTHS PRO FORMA
YEAR ENDED ENDED ENDED ENDED PRO FORMA YEAR ENDED
JULY 31, 1995 MAY 31, 1995 JULY 2, 1995 JUNE 30, 1995 ADJUSTMENTS JULY 31, 1995
------------- ------------ ------------- -------------- ------------ -------------

Sales.......................... $21,032 $ 28,833 $27,922 $ 21,719 $ $99,506
Cost of sales.................. 14,336 20,914 16,433 13,819 65,502
------- -------- ------- -------- -------
Gross profit................. 6,696 7,919 11,489 7,900 34,004
Selling, general and
administrative expenses...... 7,068 6,612 8,946 5,906 (342)(i) 28,190
Depreciation and
amortization................. 690 310 666 277 369 (h) 2,312
------- -------- ------- -------- -------- -------
Operating income (loss)...... (1,062) 997 1,877 1,717 (27) 3,502
Interest expense............... 403 (42) 74 120 1,455 (j) 2,010
Other (income) expense......... 157 (175) -- (162) (180)
------- -------- ------- -------- -------- -------
Income (loss) before income
taxes..................... (1,622) 1,214 1,803 1,759 (1,482) 1,672
Income taxes................... 3 10 -- 78 660 (l) 751
------- -------- ------- -------- -------- -------
Net income (loss)............ $(1,625) $ 1,204 $ 1,803 $ 1,681 $ (2,142) $ 921
======= ======== ======= ======== ======== =======
Net income (loss) per common
share........................ $ (0.81) $ 0.22
======= =======
Weighted average common shares
outstanding.................. 2,018 4,258
======= =======

The accompanying Notes to Unaudited Pro Forma Consolidated Condensed Financial
Statements are an integral part of these statements.

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21

UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
NINE MONTHS ENDED APRIL 30, 1996
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ACQUIRED
COMPANIES
MAYNE PRO FORMA THE COMPANY
THE COMPANY NICKLESS COMBINED PRO FORMA
NINE MONTHS SIX MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED PRO FORMA ENDED
APRIL 30, 1996 DECEMBER 31, 1995 MARCH 31, 1995 ADJUSTMENTS APRIL 30, 1996
-------------- ----------------- -------------- ----------- --------------

Sales.................... $ 50,015 $14,008 $ 15,287 $(2,067)(k) $ 77,243
Cost of sales............ 35,079 7,985 9,554 (994)(k) 51,624
-------- ------- -------- ------- --------
Gross profit........... 14,936 6,023 5,733 (1,073) 25,619
Selling, general
and administrative
expenses............... 12,391 4,924 4,503 (993)(k) 20,642
(183)(i)
Depreciation and
amortization........... 1,066 312 224 221 (h) 1,823
-------- ------- -------- ------- --------
Operating income
(loss).............. 1,479 787 1,006 (118) 3,154
Interest expense......... 1,079 36 76 482 (j) 1,673
Other (income) expense... -- -- (123) -- (123)
-------- ------- -------- ------- --------
Income (loss) before
income taxes........ 400 751 1,053 (600) 1,604
Income taxes............. 11 -- 45 660 (l) 716
-------- ------- -------- ------- --------
Net income (loss)...... $ 389 $ 751 $ 1,008 $(1,260) $ 888
======== ======= ======== ======= ========
Net income (loss) per
common share........... $ 0.10 $ 0.21
======== ========
Weighted average common
shares outstanding..... 3,706 4,258
======== ========

The accompanying Notes to Unaudited Pro Forma Consolidated Condensed Financial
Statements are an integral part of these statements.

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22

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS

BASIS OF PRESENTATION -- The accompanying Unaudited Pro Forma Consolidated
Condensed Balance Sheet presents the financial condition of the Company as if
the Acquisitions had occurred as of April 30, 1996. The Unaudited Pro Forma As
Adjusted Consolidated Condensed Balance Sheet presents the financial condition
of the Company as if the Acquisitions, the Offering, including the application
of proceeds thereof, and the exercise of the Bridge Warrants had occurred as of
April 30, 1996. The Pro Forma Consolidated Condensed Statement of Operations
presents the results of operations for the nine months ended April 30, 1996 as
if the Acquisitions and the acquisition of Mayne Nickless had occurred at the
beginning of that period. In addition, the Unaudited Pro Forma Consolidated
Condensed Statement of Operations for the year ended July 31, 1995 has been
presented as if the Acquisitions and the acquisition of Mayne Nickless and
Dynamex Express had occurred as of the beginning of that period. Each of these
acquisitions has been accounted for under the purchase method of accounting.
Accordingly, the total purchase price, including transaction costs, has been
allocated to the assets and liabilities of the acquired businesses based on
their estimated fair value.

The Acquisitions are being financed by the issuance of Common Stock to the
sellers and from a portion of the cash proceeds of the Offering. Accordingly,
the pro forma condensed financial statements give effect to the issuance of
126,170 shares of Common Stock to the sellers of the Acquired Companies and
825,000 shares of Common Stock pursuant to the Offering (assuming all such
shares are issued at an initial public offering price of $11.00 per share). The
sale of these shares would result in net proceeds to the Company of
approximately $8.4 million, net of underwriting discount and estimated offering
expenses, which amount equals the sum of (i) the cash portion of the aggregate
purchase price of the Acquisitions, (ii) the aggregate indebtedness of the
Acquired Companies which is to be repaid by the Company upon the closing of the
Acquisitions and (iii) estimated transaction costs related to the Acquisitions.
The Offering will result in the issuance of 3,100,000 shares of Common Stock,
including the 825,000 shares issued to finance the cash portion of the
Acquisitions. This will result in net proceeds to the Company of approximately
$30.9 million (assuming an initial public offering price of $11.00 per share),
after deducting the underwriting discount and estimated offering expenses. These
proceeds will be used to fund the cash portion of the Acquisitions, as described
above, and to repay indebtedness of approximately $21.2 million based on
outstanding principal balances as of April 30, 1996.

AMORTIZATION OF INTANGIBLE ASSETS -- Intangible assets, including goodwill,
are amortized over periods ranging from 5 to 25 years. The weighted average
amortization period for all intangible assets is approximately 20 years.

Adjustments to Pro Forma Condensed Balance Sheet:

(a) To reflect purchase of Acquired Companies.

The Purchase price is comprised of:

(IN THOUSANDS)
--------------

Cash (including transaction costs of $400,000)................. $7,600
Common Stock................................................... 1,388
------
Purchase price................................................. $8,988
======

(b) To reflect the Acquisitions and to adjust the assets and liabilities of
the Acquired Companies to fair value. The Purchase price of the Acquired
Companies is allocated as follows:

(IN THOUSANDS)
--------------

Purchase price................................................. $8,988
Net book value of Acquired Companies........................... (2,897)
------
Excess of purchase price over net book value of assets
acquired..................................................... $6,091
======

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23

The assets and liabilities of the Acquired Companies have been recorded at
net book value which is estimated to equal fair value. The excess of the
purchase price over this estimated fair value has been allocated to the
intangible assets acquired, including goodwill (approximately $5,691,000) and
tradenames, agreements not to compete and customer lists (aggregating
approximately $400,000).

(c) To reflect issuance of a portion of 825,000 shares of Common Stock in
the Offering, which amount will result in net proceeds to the Company of
approximately $8.4 million, assuming an initial public offering price of $11.00
per share. A portion of the proceeds of the Offering are to be used for the cash
and transaction cost components of the Acquisition purchase price and to repay
indebtedness of the Acquired Companies (approximately $840,000) in connection
with the Acquisitions, which amounts aggregate $8.4 million.

(d) To reflect repayment of approximately $840,000 of aggregate
indebtedness ($645,000 current portion of long-term and $195,000 long-term) of
the Acquired Companies in connection with the Acquisitions.

Adjustments to Pro Forma As Adjusted Condensed Balance Sheet:

(e) To reflect issuance of the balance of the shares of Common Stock
pursuant to the Offering (2,275,000 shares), assuming an initial public offering
price of $11.00 per share.

(f) To reflect repayment of outstanding debt with principal balance of
approximately $21.2 million (and a carrying value of approximately $20.6 million
which includes approximately $1.9 million current portion of long-term and
approximately $18.7 million long-term) with proceeds from the Offering. The
early retirement of the Bridge Facility, which has a principal balance of $4.5
million and a carrying value of approximately $3.9 million, will result in an
extraordinary loss of $596,000.

(g) To reflect exercise of Bridge Warrants, including receipt of aggregate
exercise price of $13,500.

Adjustments to Pro Forma Condensed Statements of Operations:

(h) To reflect adjustment to depreciation and amortization based upon the
effects of the purchase price allocation as if the acquisitions of Dynamex
Express and Mayne Nickless and the Acquisitions had occurred at the beginning of
the period presented.

(i) To eliminate corporate overhead charges to Mayne Nickless for those
periods prior to its acquisition by the Company. These charges represent an
allocation of general corporate overhead from the former parent of Mayne
Nickless made to allocate all corporate costs to its various operating units.
These charges, which the Company will not incur, were in addition to charges for
specific services and functions provided by the former parent.

(j) To reflect net increase in interest expense as a result of debt
incurred to acquire Dynamex Express and Mayne Nickless.

(k) To eliminate operating results of Mayne Nickless for the month of July
1995. By combining the results of operations of the Company for the nine months
ended April 30, 1996 (which includes the operations of Mayne Nickless for four
months) and the results of operations of Mayne Nickless for the six months ended
December 31, 1995, the combined results of operations for the nine months ended
April 30, 1996 contain the results of Mayne Nickless for ten months.

(l) To reflect adjustment to provision for income taxes.

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24

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the information
contained in the financial statements, including the notes thereto, and the
other financial information appearing elsewhere in this Prospectus.

GENERAL

The Company had no significant operations prior to the year ended July 31,
1992. Since that date, the Company has completed 10 acquisitions of same-day
courier operations in the U.S. and Canada. Each of these acquisitions has been
accounted for using the purchase method of accounting. Accordingly, the
Company's historical results of operations reflect the results of acquired
operations as of the date of acquisition. The most significant of these
transactions were (i) the acquisition of Dynamex Express in May 1995, pursuant
to which the Company acquired the majority of its Canadian operations and
employed its Chief Executive Officer and certain other key employees, and (ii)
the acquisition of Mayne Nickless in December 1995. The operating results
attributable to the operations of Dynamex Express are included in the Company's
historical results after May 31, 1995, and the operations of Mayne Nickless are
included in the Company's historical results after December 28, 1995.
Consequently, the year ended July 31, 1995 includes Dynamex Express operations
for two months and does not include any operations of Mayne Nickless and the
nine month period ended April 30, 1996 includes nine months of Dynamex Express
operations and four months of Mayne Nickless operations. As a result, the
historical operating results of the Company for a given period are not
necessarily comparable to prior or subsequent periods, and in particular, the
periods prior to the Company's acquisition of Dynamex Express are not
necessarily comparable to the periods subsequent to such acquisition.

Sales consist primarily of charges to customers for individual delivery
services and weekly or monthly charges for recurring services, such as fleet
management. Sales are recognized when the service is performed. The amount of
yield (revenue per transaction) for a particular service is dependent upon a
number of factors including size and weight of articles transported, distance
transported, special handling requirements, requested delivery time and local
market conditions. Generally, articles of greater weight, transported over
longer distances and those that require special handling produce higher yields.

Cost of sales consists of costs relating directly to performance of
services, including driver and messenger costs and third party delivery charges,
if any. The Company almost exclusively utilizes drivers who own their own
vehicles, and approximately 83% of these owner/operators are independent
contractors as opposed to employees of the Company. Drivers and messengers are
generally compensated based on a percentage of the charge for a delivery.
Consequently, the Company's costs directly associated with providing these
services are variable in nature. To the extent that the drivers and messengers
are employees of the Company, employee benefit costs related to them, such as
payroll taxes and insurance, are also included in cost of sales.

Selling, general and administrative expenses include costs incurred at the
branch level related to taking orders, dispatching drivers and messengers, as
well as administrative costs related to such functions. Also included in
selling, general and administrative expenses are regional and corporate level
marketing and administrative costs and occupancy costs related to branch and
corporate locations.

Generally, the Company's on-demand services provide higher gross profit
margins than do scheduled distribution or fleet management services because
driver compensation for on-demand services is generally lower as a percentage of
sales from such service. However, scheduled distribution and fleet management
services generally have fewer administrative requirements related to order
taking, dispatching drivers and billing. As a result of these variances, the
Company's margins are dependent in part on the mix of business for a particular
period.

As the Company has no significant investment in transportation equipment,
depreciation and amortization expense relates to depreciation of office,
communication and computer equipment and the amortization of intangible assets
acquired in the Company's various acquisitions, each of which has been accounted
for using the purchase method of accounting. The Company expects to continue to
make acquisitions and anticipates

22
25

that such acquisitions will be accounted for using the purchase method of
accounting. As a consequence, it is likely that in the future the Company will
incur additional expense from amortization of acquired intangible assets,
including goodwill.

The Company intends to utilize $4.5 million of the net proceeds from the
Offering to redeem the Bridge Notes. The carrying value of the Bridge Notes,
approximately $3.9 million, is the estimated fair value of such facility at the
date of its issuance plus the amortization of the difference between such
estimated fair value and the principal amount through April 30, 1996.
Consequently, the Company will incur an extraordinary loss in the amount of this
difference, approximately $596,000, in connection with the redemption of the
Bridge Notes upon the closing of the Offering. See "Use of Proceeds."

RESULTS OF OPERATIONS

The following table sets forth for the periods indicated, certain items
from the Company's consolidated statement of operations, expressed as a
percentage of sales:

NINE MONTHS
ENDED
YEAR ENDED JULY 31, APRIL 30,
--------------------------- ----------------
1993 1994 1995 1995 1996
----- ----- ----- ----- -----

Sales.......................................... 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales.................................. 57.6 74.2 68.2 68.8 70.1
----- ----- ----- ----- -----
Gross profit................................. 42.4 25.8 31.8 31.2 29.9
Selling, general and administrative expenses... 103.3 34.9 33.6 37.2 24.8
Depreciation and amortization.................. 7.4 4.6 3.3 4.5 2.1
----- ----- ----- ----- -----
Operating income............................. (68.3) (13.7) (5.1) (10.5) 3.0
Interest expense............................... 3.4 2.2 1.9 2.1 2.2
Other (income) expense......................... (1.9) (0.7) 0.7 -- --
----- ----- ----- ----- -----
Income (loss) before taxes................... (69.8)% (15.2)% (7.7)% (12.6)% 0.8%
===== ===== ===== ===== =====

NINE MONTHS ENDED APRIL 30, 1996 COMPARED TO NINE MONTHS ENDED APRIL 30, 1995

The nine months ended April 30, 1996 include the results of Dynamex Express
which was acquired by the Company on May 31, 1995. In addition the results for
that period include the results from the operations acquired from Mayne Nickless
on December 29, 1995 for the period January through April 30, 1996. As a result
of the Mayne Nickless acquisition, the Company obtained additional operations in
Los Angeles, San Diego, San Francisco, Seattle, Pittsburgh, Boston, Washington
D.C., Baltimore and Vancouver and Victoria, British Columbia.

Sales increased $38.7 million, or 341%, from $11.3 million for the nine
months ended April 30, 1995 to $50.0 million for the nine months ended April 30,
1996. Approximately $29.6 million of this increase is attributable to the
acquired operations of Dynamex Express and approximately $10.2 million is
attributable to the inclusion of the operations of Mayne Nickless. Sales
attributable to the previously existing operations of the Company declined by
approximately $1.1 million from the nine months ended April 30, 1995 to the nine
months ended April 30, 1996 primarily due to a decline in sales in Arizona that
was partially offset by increases in sales in Western Canada. In January and
February 1996, severe winter storms in the Eastern United States resulted in a
general disruption of commerce and therefore a decline in sales for the
Company's operations in those areas.

Cost of sales increased by $27.3 million, or 349%, from $7.8 million for
the nine months ended April 30, 1995 to $35.1 million for the nine months ended
April 30, 1996. Approximately $21.7 million of this increase is attributable to
the operations of Dynamex Express and approximately $6.4 million is attributable
to the operations of Mayne Nickless. This increase was partially offset by a
decrease in the cost of sales from the existing operations of the Company. The
Company's gross profit margin declined from 31.2% in the nine month period ended
April 30, 1995 to 29.9% in the nine month period ended April 30, 1996. The
decrease was

23
26

primarily caused by two factors (i) the higher proportion of lower margin
scheduled distribution and fleet management business arising from the inclusion
of Dynamex Express operations in the 1996 period (which decrease was partially
offset by the additional higher margin on-demand business arising from the
inclusion of Mayne Nickless operations during four months of such period) and
(ii) the decline in gross margin attributable to the Company's operations in
Western Canada and Arizona due to competitive pressures and certain unprofitable
business. To a lesser extent, the increased cost of providing service during the
winter storms which occurred during the nine months ended April 30, 1996 had a
negative impact on the Company's gross profit margin during such period.

Selling, general and administrative expenses increased $8.2 million, or
193%, from $4.2 million for the nine months ended April 30, 1995 to $12.4
million for the nine months ended April 30, 1996, primarily because the 1996
period includes costs related to Dynamex Express operations and, to a lesser
extent, costs related to Mayne Nickless operations. As a percentage of sales,
selling, general and administrative expenses decreased from 37.2% for the nine
months ended April 30, 1995 to 24.8% for the nine months ended April 30, 1996.
This decrease resulted from a larger revenue base which enabled the Company to
spread such costs over more sales, and the absence of certain revisions to
accounting estimates made in the 1995 period. Despite this decrease, the Company
has continued to invest in and to incur significant costs related to its
national and regional marketing program. During the nine months ended April 30,
1995 the Company also revised its estimates of uncollectible accounts, accrued
insurance costs and other accrued liabilities. As a result of these revisions,
the Company recognized additional selling, general and administrative expenses
of approximately $715,000.

Depreciation and amortization expense for the nine months ended April 30,
1996 increased by $557,000, or 109%, from $509,000 for the nine months ended
April 30, 1995 to $1.1 million for the nine months ended April 30, 1996. Of this
increase, approximately $309,000 relates to depreciation and amortization of
assets related to Dynamex Express and approximately $251,000 relates to
depreciation and amortization of assets related to Mayne Nickless.

Interest expense increased $839,000, or 350%, from $240,000 for the nine
months ended April 30, 1995 to $1.1 million for the nine months ended April 30,
1996. Increased debt of approximately $4.7 million incurred in connection with
the acquisition of Dynamex Express created approximately $350,000 of this
increase while additional debt of $12.3 million incurred in connection with the
acquisition of Mayne Nickless resulted in increased interest expense of
approximately $535,000. These increases were partially offset by lower average
balances of other debt and reduced interest rates on certain debt refinanced at
the time of the Mayne Nickless acquisition.

YEAR ENDED JULY 31, 1995 COMPARED TO YEAR ENDED JULY 31, 1994

Effective May 31, 1995, the Company acquired Dynamex Express. As a result,
the Company's operating results for the year ended July 31, 1995 include the
results of Dynamex Express for the months of June and July. Sales increased by
approximately $14.0 million, or 199%, from $7.0 million for fiscal year 1994 to
$21.0 million for fiscal year 1995. Approximately $5.9 million of this increase
relates to the inclusion of Dynamex Express for two months in fiscal year 1995.
The balance of the increase results primarily from the inclusion of a full year
of results from acquisitions made by the Company during fiscal year 1994.

Cost of sales for fiscal 1995 increased approximately $9.1 million, or
175%, from $5.2 million in fiscal year 1994 to $14.3 million in fiscal year
1995, as a result of the increase in sales discussed above. Approximately $4.2
million of this increase is attributable to the inclusion of the operations of
Dynamex Express in 1995. The Company's gross profit margin increased to 31.8% in
fiscal 1995 as compared to 25.8% in fiscal 1994. This increase resulted
primarily from the change in business mix resulting from the acquired
businesses, including Dynamex Express. The businesses acquired by the Company
during fiscal 1994 had generally higher gross profit margins than the Company's
previously existing operations due to a higher proportion of on-demand business,
and as a consequence, the Company's average gross profit margin increased during
fiscal 1995. The operations of Dynamex Express historically had a lower gross
profit margin than the businesses acquired by the Company during 1994, but a
higher gross profit margin than the Company's previously existing operations.

24
27

Selling, general and administrative expenses increased approximately $4.7
million, or 189%, from $2.4 million in fiscal 1994 to $7.1 million in fiscal
1995, due in part to the increased administrative activities associated with the
growth in revenues and the additional locations of the businesses acquired in
fiscal 1995 and 1994. As a percentage of sales, selling, general and
administrative expenses decreased in fiscal 1995 to 33.6% compared to 34.9% in
fiscal 1994.

Depreciation and amortization expense increased by $368,000, or 114%, from
$322,000 in fiscal 1994 to $690,000 in fiscal 1995. Of this increase,
approximately $76,000 relates to depreciation and amortization of assets related
to Dynamex Express with the balance relating to amortization of costs
attributable to acquisitions made during fiscal 1994.

Interest expense increased by $246,000, or 157%, from $157,000 in fiscal
1994 to $403,000 in fiscal 1995, as a result of debt incurred or assumed in
connection with these acquisitions.

YEAR ENDED JULY 31, 1994 COMPARED TO YEAR ENDED JULY 31, 1993

The Company's sales increased by approximately $6.3 million, or 865%, from
$728,000 in fiscal year 1993 to $7.0 million in fiscal year 1994, primarily as a
result of the Company's acquisition of five different courier operations between
December 1993 and June 1994. Prior to these acquisitions, the Company operated
only in Arizona. With these acquisitions, the Company established operations in
Chicago, Illinois; Los Angeles, California; and in Western Canada. During this
period, cost of sales increased by approximately $4.8 million, or over 1,000%,
from $419,000 in 1993 to $5.2 million in 1994, in conjunction with the increase
in sales. Selling, general and administrative expenses increased by
approximately $1.7 million, or 226%, from $752,000 in fiscal 1993 to $2.4
million in fiscal 1994 as the Company's sales and administrative activities
increased as a result of the newly acquired operations. Depreciation and
amortization increased by $268,000, or 496%, from $54,000 in fiscal 1993 to
$322,000 in fiscal 1994, due to the amortization of the costs of the acquired
operations discussed above in fiscal 1994. These acquisitions were financed
partially with debt and consequently, the Company's interest expense increased
$132,000, or 528%, from $25,000 in fiscal 1993 to $157,000 in fiscal 1994. Due
to the small revenue base of the Company's business in fiscal year 1994,
comparisons of costs and expenses, expressed as a percentage of sales, between
fiscal 1993 and 1994 are not meaningful.

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary capital requirements relate to its acquisition
strategy and, to a lesser extent, working capital and capital expenditures.
Since July 31, 1992, the Company has completed 10 acquisitions of same-day
courier companies with consideration therefor, including transaction costs,
aggregating approximately $30.0 million (of which approximately $17.5 million
was paid in cash). For the nine months ended April 30, 1996 and for the year
ended July 31, 1995, capital expenditures were $446,000 and $213,000,
respectively. As of April 30, 1996, the Company's working capital was $3.3
million. Prior to the nine months ended April 30, 1996, the Company's operations
did not produce positive cash flow from operations, and the Company's capital
needs during these periods were supplied from bank borrowings, seller financing
and the private placement of debt and equity securities. In December 1995, the
Company entered into a bank credit facility to provide funds for the acquisition
of Mayne Nickless and to refinance a significant portion of the seller financing
that had been incurred in connection with prior acquisitions. As of April 30,
1996, total funded debt was approximately $21.5 million (principal amount), of
which approximately $800,000 was outstanding under the Company's $2.5 million
revolving bank line of credit. The Company intends to retire substantially all
outstanding funded debt with a portion of the net proceeds of the Offering. On
July 5, 1996 the Company amended and restated the Credit Agreement to provide
for a $40.0 million revolving credit facility.

An integral part of the Company's business strategy is to pursue
acquisitions. Therefore, the Company's need for capital related to acquisitions
is expected to be significant in the future. As a result of increasing sales
arising from new acquisitions as well as internal growth, the Company also
anticipates that it will need additional working capital from time to time to
finance the resulting increase in accounts receivable in relation to accounts
payable. Capital expenditures, other than for acquisitions, are not expected to
increase materially in relation to total capital needs in the foreseeable
future.

25
28

Management expects to fund the capital requirements discussed above
primarily from four sources: (i) excess net proceeds from the Offering, if any;
(ii) the issuance of additional common equity in connection with future
acquisitions (including the Acquisitions); (iii) cash flow from operations; and
(iv) additional borrowings from banks. See "Use of Proceeds" and
"Business -- Pending Acquisitions."

On July 5, 1996, the Company amended and restated the Credit Agreement. The
Company's new credit facility under the Credit Agreement consists of a revolving
note of up to $40.0 million with interest payable quarterly at the prime rate,
or certain other rate options based on certain financial ratios of the Company.
Any amounts outstanding under the revolving note on May 31, 1998 will be
converted to a term facility which will be repayable in nineteen equal quarterly
installments of principal over a five year period. Interest on the term facility
is payable quarterly at the prime rate, or certain other rate options based on
certain financial ratios of the Company.

Amounts outstanding under the Credit Agreement are secured by essentially
all of the assets of the Company and its subsidiaries. The Credit Agreement also
contains restrictions on the payment of dividends, incurring additional debt,
capital expenditures and investments by the Company as well as requiring the
Company to maintain certain financial ratios. See Note 5 of Notes to the
Consolidated Financial Statements.

Management believes that sources of capital discussed above, namely excess
proceeds of the Offering, if any, cash flow from operations, and the Company's
credit facility will be sufficient to allow the Company to successfully pursue
its business strategy over the next 18 to 24 months. It is anticipated that
future acquisitions will be structured with a combination of cash and the
Company's Common Stock being used as consideration. The amount of capital
available for future acquisitions will depend in part on the willingness of
sellers to accept the Company's Common Stock as partial consideration. This in
turn will be dependent in part on the financial performance and condition of the
Company as well as general market conditions. If unable to utilize its Common
Stock to finance such acquisitions, or if the size and number of acquisitions
utilizes its available resources or exceeds the threshold above which lender
approval is required under the Credit Agreement and such approval is not
obtained, the Company may be forced to seek other sources of capital such as
additional debt or equity financing. There can be no assurance that such
additional sources of capital will be available or that they will be available
on terms which are acceptable to the Company. These factors could serve to
negatively affect the Company's ability to implement its business strategy in
the manner, or within the time frame, anticipated by management.

INFLATION

The Company does not believe that inflation has had a material effect on
the Company's results of operations nor does it believe it will do so in the
foreseeable future.

ACCOUNTING PRONOUNCEMENTS

In October 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123). SFAS 123 establishes a fair value based method of
accounting for stock-based employee compensation plans; however, it also allows
companies to continue to measure cost for such plans using the method of
accounting prescribed by Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" (APB 25). Companies that elect to continue with
the accounting under APB 25 must provide certain pro forma disclosures of net
income, as if SFAS 123 had been applied. The accounting and disclosure
requirements of SFAS 123 are effective for the Company for transactions entered
into in fiscal 1997. The Company is currently evaluating its alternatives under
SFAS 123, and its impact on operating results, when adopted by the Company, is
not presently known.

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29

BUSINESS

GENERAL

Through its network of branch offices, the Company provides same-day,
door-to-door delivery services utilizing ground couriers for intra-city
deliveries and third party air transportation providers in conjunction with
ground couriers for inter-city deliveries. The Company's same-day delivery
services include both on-demand and scheduled deliveries. On-demand services are
typically unscheduled deliveries of time-sensitive materials and include
deliveries of inventory made on a just-in-time basis from strategic stocking
locations managed by Company personnel. Scheduled distribution services
encompass recurring, often daily, deliveries provided on a point-to-point basis
or deliveries that require intermediate handling, routing or sorting of items to
be delivered to multiple locations. With its fleet management services, the
Company assumes complete responsibility for providing and managing a fleet of
dedicated vehicles at a customer site. The Company's on-demand delivery
capabilities are available to supplement the scheduled distribution and
dedicated fleets as necessary.

The Company intends to expand its operations in the U.S. and Canada by (i)
increasing customer utilization of its primary services at each location, (ii)
targeting national and regional accounts, (iii) creating alliances with
strategic partners, and (iv) pursuing acquisitions of high quality same-day
delivery companies.

INDUSTRY OVERVIEW

The delivery and logistics industry is large, highly fragmented and
growing. The industry is composed primarily of same-day, next-day and second-day
service providers. The Company primarily services the same-day, intra-city
delivery market. Historically, same-day delivery service primarily related to
downtown document deliveries. Over time, technological developments such as
facsimile and electronic mail have increased time sensitivity in a variety of
business transactions, thereby increasing demand for the same-day delivery of
non-faxable items. The category of non-faxable items that require time sensitive
delivery is vast and includes items such as voluminous or confidential
documents, critical manufacturing parts, medical devices and replacement
computer parts.

The Company believes that the same-day delivery and logistics industry
offers substantial consolidation opportunities as a result of industry
fragmentation and the benefits of large scale operations. The same-day delivery
and logistics industry in the U.S. and Canada is highly fragmented and primarily
consists of several thousand small, independent businesses serving local markets
and a small number of multi-location regional or national operators. Relative to
smaller companies, the Company believes that national operators such as the
Company benefit from several competitive advantages including: national brand
identity, professional management, the ability to service national accounts and
centralized administrative and management information systems.

In an effort to control costs and focus on primary competencies, many
businesses are seeking to reduce their reliance on in-house transportation
departments by turning to third party experts to provide transportation
logistics services. These logistics services include designing and managing
systems created to maximize efficiencies in transporting, warehousing, sorting
and delivering products. Many businesses that outsource their distribution
requirements prefer to purchase such services from one source that can service
multiple cities, thereby decreasing the number of vendors from whom they
purchase services.

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THE DYNAMEX EXPRESS BUSINESS MODEL

The Company was founded in 1992 as Parcelway Systems Holding Corp. In May
1995, the Company acquired Dynamex Express, the ground courier operations of Air
Canada, which was led by Richard K. McClelland, the Company's Chief Executive
Officer. At the time of its acquisition by the Company, Dynamex Express had
developed an integrated network of locations across Canada and offered an array
of delivery and logistics services on a national, multi-city and local basis.
The Company seeks to expand its operations by implementing and expanding upon
the business strategy utilized by Dynamex Express.

Prior to 1989, Dynamex Express concentrated on same-day document delivery
in the central business districts of the major metropolitan cities of Canada.
Recognizing that an increasing variety of business transactions were becoming
more time sensitive and in order to offset declining volumes in same-day
document delivery, Dynamex Express expanded its customer base to include
manufacturing companies, pharmaceutical companies, auto parts distributors,
governmental agencies and other businesses that require same-day delivery of
non-faxable items. Dynamex Express further responded to shifting market
conditions by leveraging its ability to efficiently provide same-day delivery of
small to mid-size items in metropolitan areas to provide value added services
such as fleet management and strategic stocking.

Dynamex Express also expanded its business by acquiring other same-day,
intra-city courier companies within Canada. By May 1995, Dynamex Express had
acquired a regional and several single-site courier companies across Canada and
had locations in 20 Canadian cities. Dynamex Express expanded the service
offerings of these acquired companies to include fleet management and strategic
stocking and standardized the operating policies and procedures at each
location. At the time of the Company's acquisition of Dynamex Express in May
1995, approximately 46% of Dynamex Express revenues were generated from same-day
on-demand delivery, 30% from fleet management and 24% from same-day scheduled
distribution services. Approximately 48% of these revenues were generated from
services provided to customers on a national or multi-city basis.

BUSINESS STRATEGY

The Company intends to implement and expand upon the Dynamex Express
business model in the U.S. and Canadian markets in order to capitalize on the
demand of local, regional and national businesses for innovative same-day
distribution solutions. The key elements of the Company's business strategy are
as follows:

- FOCUS ON PRIMARY SERVICES. The Company provides three primary services:
(i) same-day on-demand delivery, (ii) same-day scheduled distribution and
(iii) fleet management. To raise the yield per delivery, the Company will
continue to focus its same-day on-demand delivery business on non-faxable,
time sensitive items that are transported throughout major metropolitan
areas and to offer value added on-demand services such as strategic
stocking. By concentrating its logistics services in fleet management and
same-day scheduled distribution, the Company intends to capitalize on the
market trend towards outsourcing transportation requirements. The delivery
transactions in a fleet management, scheduled distribution or strategic
stocking program are recurring in nature, thus creating the potential for
long term customer relationships. Additionally, these services are
generally less vulnerable to price competition than traditional delivery
services.

- TARGET NATIONAL AND REGIONAL ACCOUNTS. The Company's sales force focuses
on pursuing and maintaining national and regional accounts. The Company
anticipates that its (i) existing multi-city network of locations combined
with new locations to be acquired, (ii) ability to offer value added
services such as strategic stocking and fleet management to complement its
basic same-day delivery services and (iii) experienced management team
will create further opportunities with many of its existing customers and
attract new national and regional accounts.

- CREATE STRATEGIC ALLIANCES. By forming alliances with strategic partners
that offer compatible services or have complex distribution needs, the
Company and its partner can jointly market their services, thereby
accessing one another's customer base and providing such customers with a
broader range of

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services. Pursuant to its strategic alliance with Purolator Courier Ltd.
("Purolator"), the largest Canadian overnight courier company, the Company
and Purolator have agreed to provide one another with wholesale courier
services and to market the other partner's delivery services to its
customers. See "Sales and Marketing."

- PURSUE ACQUISITIONS. The Company believes that the highly fragmented
nature of the delivery and logistics industry creates significant
opportunities for same-day delivery and logistics companies with national
marketing efforts and operations. Upon consummation of the Acquisitions,
the Company will have substantially completed its Canadian network and
will focus its acquisition program on further penetrating the U.S. market.

The Company will seek to acquire high quality same-day delivery businesses
in new cities as well as in markets where it has already established a
presence. The Company plans to augment the service offerings of its
acquired companies with additional services such as fleet management and
strategic stocking and to integrate the acquired operations into the
Company's operating environment. Acquisitions in existing markets are
expected to give the Company access to an acquired company's customer base
while creating operating efficiencies within these markets. The Company
believes that its management team's operating and acquisition experience
will allow it to remain competitive in the acquisition market.

SERVICES

The Company capitalizes on its routing, dispatch and vehicle management
expertise developed in the ground courier business to provide its customers with
a broad range of value added, same-day delivery and logistics services. By
creating innovative applications of its core services, the Company intends to
expand the market for its distribution solutions and increase the yield per
service provided.

Same-Day On-Demand Delivery

The Company provides local same-day on-demand delivery services, whereby
Company messengers or drivers respond to a customer's request for immediate
pick-up and delivery. The Company augments its same-day on-demand services by
offering inter-city ground and air transportation and next-flight-out services
provided by third party air transportation operators. The Company focuses on the
delivery of non-faxable, time sensitive items throughout major metropolitan
areas rather than traditional downtown document delivery. By delivering items of
greater weight over longer distances and providing value added on-demand
services such as strategic stocking, the Company expects to continue to raise
the yield per delivery relative to the yield generated from downtown document
deliveries.

The Company's on-demand services include the delivery of a customer's
inventory on a just-in-time basis from strategic stocking locations managed by
Company personnel. Strategic stocking locates the customer's inventory closer to
its ultimate destination, thereby improving the customer's ability to service
its own customers. The Company does not take ownership of or title to the
inventory but provides the warehouse space or utilizes space provided by its
customer to establish and manage a customized, multi-site strategic stocking
program. Furthermore, the Company can bundle services such as same-day ground,
same-day air and next-day air delivery to replenish stocking locations.

The benefits of strategic stocking to the customer include (i) faster
response time due to broader distribution of inventory locations and emergency
transportation capabilities, (ii) decreased lease and employee costs associated
with warehouse functions resulting from the Company's ability to consolidate
warehouse space and administrative costs for multiple strategic stocking
customers and (iii) improved inventory control through improved information
systems. For example, when a computer parts and services distributor must
quickly replace defective or worn out computer parts, the potential loss to the
distributor's customer increases with the length of time it takes the
distributor to deliver and install the replacement part. By storing computer
parts in the Company's network of strategic stocking locations, the distributor
can contact the Company and have the replacement part delivered to its customer
within hours instead of days. The Company has targeted the computer and
telecommunications industries as primary markets for strategic

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stocking services and has established a network of parts banks across Canada to
serve such markets. Additionally, the Company has introduced a service
enhancement, whereby straightforward repairs, such as replacement of a defective
keyboard, are performed by Company drivers, thus eliminating the need to
dispatch a technician.

While strategic stocking currently comprises only a small portion of the
Company's same-day on-demand business, the Company intends to expand its
strategic stocking program and has recently purchased strategic stocking
software, hardware and certain other related assets from an experienced
strategic stocking operator whom the Company now employs. The Company intends to
expand the network of parts banks and courier alliances established by this
operator by utilizing its own courier network in the U.S. and Canada and intends
to utilize the additional courier alliances to increase its next-flight-out
capability.

For the nine months ended April 30, 1996, approximately 61% of the
Company's revenues were generated from on-demand same-day delivery services,
including strategic stocking services.

Same-Day Scheduled Distribution

The Company provides same-day scheduled distribution services for
time-sensitive local deliveries that, by their nature, are recurring. Scheduled
distribution services include regularly scheduled deliveries made on a
point-to-point basis or deliveries that require intermediate handling, routing
or sorting of items to be delivered to multiple locations. A bulk shipment may
be received at the Company's warehouse where it is sub-divided into smaller
bundles and sorted for delivery to specified locations. Same-day scheduled
distribution services are provided on both a local and multi-city basis. The
Company's on-demand delivery capabilities are available to supplement the
scheduled drivers as needed. In the suburban Washington, D.C./Baltimore area,
the Company provides scheduled, as well as on-demand, delivery services for a
group of local hospitals and medical laboratories, transferring samples between
these facilities. In Ontario, Canada, the Company services the scheduled
distribution requirements of a consortium of commercial banks. These banks
require regular pick-up of non-negotiable materials that are then delivered by
the Company on an intra and inter-city basis. For the nine months ended April
30, 1996, approximately 17% of the Company's revenues were generated from
same-day scheduled distribution services.

Fleet Management

With its fleet management service, the Company provides transportation
services for customers that previously managed such operations in-house. The
Company assumes complete responsibility for providing and managing a fleet of
dedicated vehicles at the customer's site. This service is generally provided
with a fleet of dedicated vehicles that can range from passenger cars to tractor
trailers (or any combination) which may display the customer's logo and colors.
In addition, the Company's on-demand delivery capability may supplement the
dedicated fleet as necessary, thereby allowing a smaller dedicated fleet to be
maintained on average. The Company's fleet management services include designing
and managing systems created to maximize efficiencies in transporting, sorting
and delivering customer's products on a local and multi-city basis. Because the
Company generally does not own vehicles but instead hires drivers who do, the
Company's fleet management solutions are not limited by the Company's need to
utilize its own fleet.

By outsourcing its fleet management the Company's customer (i) is able to
utilize the Company's distribution and route optimization experience to deliver
its products more efficiently, (ii) gains the flexibility to expand or contract
fleet size as necessary, and (iii) reduces the costs and administrative burden
associated with owning or leasing vehicles and hiring and managing
transportation employees. For example, the Company recently configured and now
manages a distribution fleet for one of the largest distributors to drug stores
in Canada. For the nine months ended April 30, 1996, approximately 22% of the
Company's revenues were generated from fleet management services.

While the volume of each service provided and the profitability thereof
varies significantly from branch office to branch office, each of the Company's
branch offices generally offers the same core services. Factors which impact the
business mix per branch include customer base, competition, geographic
characteristics, available labor and general economic environment. The Company
can bundle its various delivery and logistics

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33

services to create customized distribution solutions and to become the
single-source for its customers' distribution needs.

OPERATIONS

The Company's operations are divided into two U.S. regions and two Canadian
regions, with each of the Company's 29 branches reporting to a regional office.
Branch operations are locally managed with regional and national oversight and
support provided as necessary. A branch manager is assigned to each branch
office and is accountable for all aspects of branch operations including
profitability. Each branch manager reports to a regional manager with similar
responsibilities for all branches within his or her region. Certain
administrative and marketing functions may be centralized for multiple branches
in a given city or region. Prices for the Company's services are determined at
the branch level based on the distance, weight and time-sensitivity of a
particular delivery.

Same-Day On-Demand Delivery

Most locations have operations centers staffed by dispatchers, as well as
customer service representatives and operations personnel. Incoming calls are
received by trained customer service representatives who use PC-based
communications software to instantly provide the customer with a job-specific
price quote and to transmit the order to the appropriate dispatch location.
Certain of the Company's larger clients can access such software through
electronic data interface to enter dispatch requirements, page specific drivers,
make inquiries, and receive billing information. A dispatcher coordinates
shipments for delivery within a specific time frame. Shipments are routed
according to the type and weight of the shipment, the geographic distance
between the origin and destination and the time allotted for the delivery.
Coordination and deployment of delivery personnel for on-demand deliveries is
accomplished either through communications systems linked to the Company's
computers, through pagers or by radio. The Company is in the process of
integrating the software system utilized by Dynamex Express into each of its
branches in order to standardize the reporting, tracking and billing of
transactions. To enhance the Company's 24-hour delivery services at all
locations, the Company is currently implementing a company-wide centralized
answering service to transmit delivery requests made after normal business hours
to the appropriate local operations team.

Same-Day Scheduled Distribution

A dispatcher coordinates and assigns scheduled deliveries to the drivers
and manages the delivery flow. In many cases, certain drivers will handle a
designated group of scheduled routes on a recurring basis. Any intermediate
handling required for a scheduled distribution is conducted at the Company's
warehouse or at a third party facility such as the airport.

Fleet Management

Fleet management services are coordinated by the Company's logistics
specialists who have experience in designing, implementing and managing
integrated networks for transportation services. Based upon the logistics
specialist's analysis of a customer's fleet and distribution requirements, the
Company develops a plan to optimize fleet configuration and route design. The
Company provides the vehicles and drivers necessary to implement the fleet
management plan. Such vehicles and drivers are generally dedicated to a
particular customer, and the vehicles may display the customer's name and logo.
The Company can supplement these dedicated vehicles and drivers with its
on-demand capability as necessary.

SALES AND MARKETING

The Company conducts a comprehensive marketing program involving direct
sales and customer service to maintain and increase its customer base.
Approximately 50 local employee sales representatives target small and mid-sized
businesses while the Company's eight regional and national marketing executives
focus on larger accounts and businesses with multi-city requirements. The
Company's sales force includes product specialists dedicated to fleet management
and strategic stocking, some of whom have developed expertise in

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34

servicing certain industries such as banks and telecommunications companies. The
Company's product specialists seek new applications of the Company's primary
services in an effort to expand the demand for such services.

The Company's marketing representatives make regular calls on existing and
potential customers to identify such customers' delivery and logistics needs.
Customer service representatives on the local and national levels regularly
communicate with customers to monitor the quality of services and to quickly
respond to customer concerns. Through its telemarketing program, the Company
maintains a database of its customers' service utilization patterns and
satisfaction level. The telemarketing database is used by the sales force to
analyze opportunities and conduct performance audits. The telemarketing group
seeks to contact most of the Company's recurring customers approximately every
90 days.

Fostering strategic alliances with customers who offer compatible services
or have complex distribution needs is an important component of the Company's
marketing strategy. For example, pursuant to a Marketing and Transportation
Services Agreement, dated November 20, 1995 between the Company and Purolator,
the Company has agreed to provide same-day delivery services to Purolator
customers and Purolator has agreed to provide overnight courier services to the
Company's customers. Pursuant to this agreement, in June 1996, Purolator began
to market and the Company began to offer the following services to Purolator
customers: (i) same-day local ground courier services; (ii) same-day inter-city
ground courier services; and (iii) next-flight-out service between major cities
in Canada and the U.S. When a Purolator customer requests any of these services,
Purolator transfers such request to one of the Company's customer service
representatives. The Company then dispatches the delivery order and bills
Purolator at a discounted rate. Purolator in turn bills the customer at its own
rate.

The Marketing and Transportation Services Agreement is generally terminable
upon two years notice but may be terminated upon a breach of the agreement or
certain other events of default as set forth therein. The relationship between
the Company and Purolator consists of the rights and obligations described in
the aforementioned agreement and is not a joint venture or partnership. The
Company also provides Purolator with local and inter-city same-day ground
courier service for misdirected Purolator shipments. Purolator is the largest
overnight courier in Canada with approximately 9,000 employees who handle
approximately 300,000 packages daily. The Company believes that the increased
transaction volume and marketing efforts contemplated by the Purolator alliance
could significantly increase the Company's business in Canada.

The Company generally enters into customer contracts for scheduled
distribution, fleet management and strategic stocking services which are
terminable (in selected cases with cancellation penalties) by such customer upon
notice generally ranging from 30 to 90 days. The Company does not typically
enter into contracts with its customers for on-demand delivery services other
than strategic stocking services.

CUSTOMERS

As of April 30, 1996, the Company had a diversified customer base of
approximately 18,000 active customers across the U.S. and Canada. The Company's
target customer is a business that distributes time-sensitive, non-faxable items
that weigh from one to 70 pounds to multiple locations. The primary industries
served by the Company include financial services, pharmaceuticals, medical
laboratories and hospitals, auto parts, legal services and Canadian governmental
agencies. As of April 30, 1996, no single industry accounted for more than 10%
of the Company's annual revenues. A significant number of the Company's
customers are located in Canada. Approximately 60% of the Company's pro forma
revenues for the nine months ended April 30, 1996 were generated in Canada. See
Note 8 of Notes to the Consolidated Financial Statements and "Pro Forma
Financial Information."

COMPETITION

The market for same-day delivery and logistics services has been and is
expected to remain highly competitive. The Company believes that the principal
competitive factors in the markets in which it competes are reliability,
quality, breadth of service and price. Price competition for basic delivery
services is particularly intense.

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Most of the Company's competitors in the same-day intra-city delivery
market are privately held companies that operate in only one location, with no
one competitor dominating the market. However, there is a trend toward industry
consolidation and companies with greater financial and other resources than the
Company that may not currently operate in the delivery and logistics business
may enter the industry to capitalize on such trend.

The market for the Company's logistics services is also highly competitive,
and can be expected to become more competitive as additional companies seek to
capitalize on the growth in the industry. The Company's principal competitors
for such services are other delivery companies and in-house transportation
departments. The Company generally competes on the basis of its ability to
provide customized service regionally and nationally, which it believes is an
important advantage in this highly fragmented industry, and on the basis of
price.

The Company competes for acquisition candidates with other companies in the
industry and companies that may not currently operate in the industry but may
acquire and consolidate local courier businesses. Management believes that its
operating experience and its strategy to fully integrate each acquired company
by adding its core services and introducing national marketing will allow it to
remain competitive in the acquisition market.

PENDING ACQUISITIONS

The aggregate consideration to be paid by the Company in the Acquisitions
will be approximately $7.2 million in cash and 126,170 shares of Common Stock
(assuming an initial public offering price of $11.00 per share) and the Company
will repay an aggregate of approximately $840,000 of the Acquired Companies'
indebtedness. The stockholders of each of the Acquired Companies, except for
Action Delivery and Southbank, will receive a portion of their consideration for
the Acquisitions in the form of Common Stock issued at the initial public
offering price and cash. The stockholders of Action Delivery and Southbank will
receive only cash. The consideration to be paid by the Company for the Acquired
Companies was determined through arms-length negotiations among the Company and
the representatives of the stockholders of the Acquired Companies. The factors
considered by the parties in determining the purchase price include, among
others, the historical operating results and the future prospects of the
Acquired Companies.

Upon consummation of the Acquisitions, the Company intends to integrate the
Acquired Companies into the Company's operating environment. Each Acquired
Company will be assigned to the appropriate regional division of the Company. A
current manager of each Acquired Company has agreed to continue to manage such
operation after the consummation of the Acquisitions and will be appointed
branch manager at such operation. Management will train the staff of the
Acquired Companies so that each branch will be able to provide and market the
full range of Company services. As soon as practicable and where appropriate,
the Company will assimilate each Acquired Company's accounting, payroll and cash
management functions, standardize its insurance coverage and employee benefits
and supplement or replace the use of the Acquired Company's tradename with
"Dynamex."

Although the consummation of the transactions contemplated by the
Acquisition Agreements is subject to customary conditions, these conditions have
been substantially satisfied, and each of the Acquisitions is expected to be
consummated in accordance with its terms.

For purposes of the information set forth below concerning each of the
Acquired Companies (i) the number of shares to be issued as consideration for
the Acquisitions is calculated based on an assumed initial public offering price
of $11.00 per share and (ii) Canadian dollar amounts relevant to the Action
Delivery and Zipper Acquisitions have been converted to U.S. dollars using an
exchange rate of 0.73 U.S. dollars to 1.00 Canadian dollars:

Action Delivery. Action Delivery is based in metropolitan Halifax,
Nova Scotia and operates on-demand and scheduled ground courier services in
the greater Halifax metropolitan area. The stockholders of Action Delivery
will receive an aggregate of Cdn $200,000 (approximately $146,000) in the
Acquisition, and the Company will repay Action Delivery's bank indebtedness
of approximately

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Cdn $705,000 (approximately $515,000). The current general manager of
Action Delivery will continue to manage the operations of such company
after the closing of the Acquisition. The stockholders of Action Delivery
have entered into a covenant not to compete with the Company expiring no
earlier than the third anniversary of the closing of the Acquisition.

Seidel Delivery. Seidel Delivery is based in Columbus, Ohio and
operates on-demand and scheduled ground courier services in the greater
Columbus metropolitan area. The stockholder of Seidel Delivery will receive
an aggregate of 30,227 shares of Common Stock and $332,500 in cash in the
Acquisition. The stockholder of Seidel Delivery has agreed to continue to
manage the operations of such company after the closing of the Acquisition
and has agreed to enter into a covenant not to compete with the Company
expiring no earlier than the third anniversary of the date of such closing.

Seko/Metro. Seko/Metro is based in Chicago, Illinois and operates
on-demand and scheduled ground courier services in the greater Chicago
metropolitan area. The stockholders of Seko/Metro will receive an aggregate
of 54,545 shares of Common Stock and $2.4 million in cash in the
Acquisition. The current managers of Seko/Metro have agreed to continue to
manage the operations of such company after the closing of the Acquisition.
The principal stockholders of Seko/Metro have agreed to enter into a
covenant not to compete with the Company expiring no earlier than the third
anniversary of the date of the closing of the Acquisition.

Southbank. Southbank is based in New York, New York and operates
on-demand ground courier services in the greater New York City metropolitan
area, concentrating primarily on Manhattan. The sole stockholder of
Southbank, Express It Acquisition, Inc. ("Express It") will receive an
aggregate of $2.5 million in cash in the Acquisition. Express It operates
an additional on-demand ground courier business in the greater New York
City metropolitan area which serves a different customer base than
Southbank. The Company and Express It have entered into an Agency and
Support Agreement whereby both parties will assist one another in certain
operational, administrative and marketing matters with respect to such
business. The owners of Express It have also granted the Company an 18
month option to purchase the stock of Express It for $3.25 million payable
in Common Stock issued at the initial public offering price.

Zipper. Zipper is based in Winnipeg, Manitoba and operates on-demand
and scheduled ground courier operations in the greater Winnipeg
metropolitan area. The stockholder of Zipper, K.H.B. & Associates Ltd.,
will receive an aggregate of 41,398 shares of Common Stock and an aggregate
of approximately Cdn $2.5 million (approximately $1.8 million) in cash in
the Acquisition. In addition, simultaneously with the closing of such
Acquisition, the Company will repay Zipper's bank indebtedness of
approximately Cdn $445,000 (approximately $325,000). Bruce Bishop, the son
of Zipper's sole stockholder and president, Kenneth Bishop, is the current
general manager of sales and support of Zipper and has agreed to continue
to manage the operations of such company after the closing of the
Acquisition. Kenneth Bishop has been nominated to become a director of the
Company upon consummation of the Offering and has agreed to enter into a
covenant not to compete with the Company expiring no earlier than the third
anniversary of the date of such closing.

REGULATION

As of January 1, 1995, the U.S. Federal Aviation Administration
Authorization Act of 1994 became effective, abolishing all intrastate regulatory
control over prices, routes and services to which the Company had previously
been subject. This legislation has increased the ability of the Company to
expand into new states and to expand its presence in its existing areas of
service. The Company holds nationwide general commodities authority from the
Interstate Commerce Commission and/or the Federal Highway Administration of the
U.S. Department of Transportation to transport certain property as a motor
carrier on an interstate basis within the contiguous 48 states. The Trucking
Industry Regulatory Reform Act of 1994 further deregulated certain aspects of
the transportation industry, so that the Company will no longer be required to
file tariffs setting forth its interstate rates. The Company holds permanent
extra-provincial (and where required, intra-provincial) operating authority in
all Canadian provinces where the Company does business.

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In connection with the operation of certain motor vehicles and the handling
of hazardous materials in its courier operations, the Company is subject to
regulation by the United States Department of Transportation and the states and
by the appropriate Canadian federal and provincial regulations. The Company is
also subject to regulation by the Occupational Health and Safety Administration,
provincial occupational health and safety legislation and federal and provincial
employment laws respecting such matters as hours of work, driver logbooks and
workers' compensation. To the extent the Company holds licenses to operate
two-way radios to communicate with its fleet, the Company is regulated by the
Federal Communications Commission. The Company believes that it is in
substantial compliance with all of these regulations.

SAFETY

From time to time, the Company's drivers are involved in accidents or other
activities that may give rise to liability claims. The Company currently carries
liability insurance with an aggregate limit of $15.0 million, and independent
owner/operators are required to maintain liability insurance of at least the
minimum amounts required by applicable state or provincial law. The Company also
has insurance policies covering property and fiduciary trust liability, which
coverage includes all drivers. The Company reviews prospective drivers to ensure
that they have acceptable driving records. In addition, where required by
applicable law, the Company requires prospective drivers to take a physical
examination and to pass a drug test.

PROPERTIES

The Company operates its facilities in 42 locations, all of which are
leased. These facilities are principally used for operations, general and
administrative functions and training. Several of these facilities are primarily
used as storage and warehouse space for strategic stocking. The chart below
summarizes the locations of facilities which the Company leases as of June 30,
1996:

NUMBER OF
LOCATION LEASED PROPERTIES
--------------------------------------------- -----------------

CANADA
Alberta...................................... 8
British Columbia............................. 6
Manitoba..................................... 1
Nova Scotia.................................. 1
Ontario...................................... 10
Quebec....................................... 2
Saskatchewan................................. 3
----
Total.............................. 31
====
U.S.
Arizona...................................... 1
California................................... 3
District of Columbia......................... 1
Illinois..................................... 1
Maryland..................................... 1
Massachusetts................................ 1
Pennsylvania................................. 1
Texas........................................ 1
Washington................................... 1
----
Total.............................. 11
====

The Company believes that its properties are well maintained, in good
condition and adequate for its present needs. The Company anticipates that
suitable additional or replacement space will be available when required. The
Company's facilities rental expense for the fiscal year ended July 31, 1995 and
the nine months ended April 30, 1996 was approximately $458,000 and $842,000,
respectively. The Company's principal

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executive offices are currently located in Mississauga, Ontario, although the
Company anticipates that it will move such offices to Dallas, Texas within the
next 18 months. See Note 6 of Notes to the Consolidated Financial Statements.

INTELLECTUAL PROPERTY

The Company has filed applications in the United States and Canada for
federal trade mark registration of "Dynamex" and "Dynamex Express." No assurance
can be given that any such registration will be granted or that if granted, such
registration will be effective to prevent others from using the trade mark
concurrently or preventing the Company from using the trade mark in certain
locations.

EMPLOYEES

At June 30, 1996, the Company had approximately 1,100 employees, of which
approximately 700 were employed full-time primarily in various management,
supervisory, administrative, and corporate positions, approximately 360 were
employed full-time as drivers and approximately 40 were employed part-time,
primarily as drivers. Additionally at June 30, 1996, the Company had contracts
with approximately 1,900 independent owner/operators. Management believes that
the Company's relationship with such employees and independent owner/operators
is good. See "Risk Factors -- Certain Tax Matters Related to Drivers."

In Canada, approximately 60% of the Company's drivers are represented by
major international labor unions. Management believes that the Company's
relationship with such unions is good. None of the Company's U.S. employees or
drivers are represented by unions.

LEGAL PROCEEDINGS

There are no pending legal proceedings involving the Company other than
routine litigation incidental to the Company's business, including numerous
motor vehicle-related accident claims. In the opinion of the Company's
management, such proceedings should not, individually or in the aggregate, have
a material adverse effect on the Company's business, financial condition or
results of operations.

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39

MANAGEMENT

DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES

The following table sets forth certain information concerning each of the
persons who are (i) executive officers, (ii) key employees or (iii) directors or
persons who have been nominated to become directors. Each person nominated as a
director (as indicated below) has agreed to become a director of the Company
upon the closing of the Offering.

NAME AGE POSITION(S)
- ----------------------------------- --- --------------------------------------------

Richard K. McClelland.............. 44 Chairman of the Board, President, Chief
Executive Officer and Director
Robert P. Capps.................... 42 Vice President-Finance and Corporate
Development, Treasurer and Assistant
Secretary
Martin A. Piccolo.................. 40 Controller and Secretary
James R. Aitken.................... 36 General Manager -- Eastern Canada
Catherine J. Taylor................ 41 General Manager -- Midwestern Canada
Ralph Embree....................... 46 General Manager -- Eastern U.S.
Thomas R. Stotler.................. 55 General Manager -- Western U.S.
James M. Hoak...................... 52 Director
Stephen P. Smiley.................. 47 Director(2)
Wayne Kern......................... 63 Director
Brian J. Hughes.................... 35 Director(1)(2)
Kenneth H. Bishop.................. 58 *Director(1)(2)
E. T. Whalen....................... 63 *Director

- ---------------

* Nominee

(1) Member of the Audit Committee.

(2) Member of the Compensation Committee.

Richard K. McClelland became the President and Chief Executive Officer of
the Company in May 1995 upon the closing of the Company's acquisition of Dynamex
Express, where he also served as President since 1988. He was elected as
Chairman of the Board of the Company in February 1996. Prior to joining Dynamex
Express in 1986, Mr. McClelland held a number of advisory and management
positions with the Irving Group, Purolator Courier Ltd. and Sunbury Transport
Ltd., where he was engaged in the domestic and international same-day air,
overnight air, and trucking businesses.

Robert P. Capps has served as Vice President of Finance and Corporate
Development, Treasurer and Assistant Secretary of the Company since February
1996. Mr. Capps served in various financial management capacities with Hadson
Corporation (an energy company) from February 1986 through June 1995 and was
Executive Vice President and Chief Financial Officer from May 1991 through June
1995. In October 1992, Hadson Corporation filed for protection under Chapter 11
of the Federal Bankruptcy Code. Hadson Corporation's plan of reorganization was
confirmed in November 1992. Mr. Capps is a certified public accountant.

Martin A. Piccolo became the Controller of the Company in May 1995 upon the
closing of the Company's acquisition of Dynamex Express, where he also served in
such capacity. He was elected as Secretary of the Company in September 1995 and
also served as its Treasurer from September 1995 through January 1996. Mr.
Piccolo joined Dynamex Express in January 1989 and has over 15 years experience
in the courier industry.

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40

James R. Aitken has served as the General Manager -- Eastern Canada since
February 1996. He joined the Company in May 1995 in conjunction with the
Company's acquisition of Dynamex Express. Prior to joining the Company, Mr.
Aitken was the Director of Sales and Marketing with Dynamex Express, where he
was employed from 1988 to May 1995. During his employment with Dynamex Express,
Mr. Aitken worked in sales and marketing, regional and branch management and
client development. Mr. Aitken has over 17 years of experience in the courier
industry.

Catherine J. Taylor has served as the General Manager -- Midwestern Canada
since May 1996. She joined the Company in August 1995 as Sales
Manager -- Eastern Canada. Prior to joining the Company, Mrs. Taylor was
employed by The Swift Transportation Group from 1982 where she held various
management and supervisory positions. Ms. Taylor has over 14 years of experience
in the courier industry.

Ralph Embree has served as the General Manager -- Eastern U.S. since
February 1996. He joined the Company in December 1995 in conjunction with the
Company's acquisition of Mayne Nickless. Prior to joining the Company, Mr.
Embree held a variety of operations, sales and management positions with Mayne
Nickless where he was employed for seven years. Mr. Embree has over 17 years of
experience in the courier industry.

Thomas R. Stotler has served as the General Manager -- Western U.S. since
February 1996. He joined the Company in December 1995 in conjunction with the
Company's acquisition of Mayne Nickless. Prior to joining the Company, Mr.
Stotler was employed by Mayne Nickless for over eight years as a branch manager
and regional operations manager. Mr. Stotler has over 18 years of experience in
the courier industry.

James M. Hoak has served as a director of the Company since February 1996.
Mr. Hoak founded Heritage Communications, Inc. (a diversified communications
company) in 1971 and served as its Chief Executive Officer until 1991. From 1991
to 1995, Mr. Hoak served as Chairman and Chief Executive Officer of Crown Media,
Inc. (a cable television company). Mr. Hoak has served as Chairman of the Board
of Heritage Media Corporation (a company engaged in targeted marketing services
and broadcasting) since its inception in 1987. Mr. Hoak has served as the
Chairman of the general partner of Cypress from its inception in 1992 and as the
Chairman of Hoak Capital Corporation (a private investment company) since its
inception in 1991. Since 1995, Mr. Hoak has served as the Chairman and President
of James M. Hoak & Co. (a financial services company) and as Chairman of Hoak
Securities Corp. (an investment banker, securities broker-dealer and one of the
Representatives). Mr. Hoak is a director of Airgas, Inc., MidAmerican Energy
Company, Pier 1 Imports, Inc. and Texas Industries, Inc. See "Certain
Transactions" and "Underwriting."

Stephen P. Smiley has served as a director of the Company since 1993 and
was a Vice President of the Company from December 1995 through February 1996.
Mr. Smiley was President of Hoak Capital Corporation from 1991 through February
1996 and served as President of the general partner of Cypress from its
inception in 1992 through January 1996. Mr. Smiley has been Executive Vice
President of Hunt Financial Corp. (a private investment company) since February
1996. Mr. Smiley is also a director of Sun Coast Industries, Inc. (a plastics
manufacturer).

Wayne Kern has served as a director of the Company since February 1996. Mr.
Kern has been the President of Hoak Securities Corp. since its inception in
1995. Mr. Kern has served as Senior Vice President and Secretary of Heritage
Media Corporation since 1987. From 1991 to 1995, Mr. Kern also served as
Executive Vice President of Crown Media, Inc. From 1979 to 1991, Mr. Kern served
as the Executive or Senior Vice President, General Counsel and Secretary of
Heritage Communications, Inc.

Brian J. Hughes has served as a director of the Company since May 1995. Mr.
Hughes has served as the Vice President -- Investments of both Preferred Risk
Life Insurance Company and Preferred Risk Mutual Insurance Company since
September 1992. Mr. Hughes has been a member of the Advisory Board of Cypress
since March 1993. From 1986 to 1992, Mr. Hughes served as Assistant Vice
President -- Investments at Boatmen's National Bank.

Kenneth H. Bishop is a nominee to become a director of the Company upon the
closing of the Offering. From 1974 to the present, Mr. Bishop has been President
and General Manager of Zipper Transportation Services, Ltd., a same-day delivery
business in Winnipeg, Manitoba. See "Business -- Pending Acquisitions."

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41

E. T. Whalen is a nominee to become a director of the Company upon the
closing of the Offering. Mr. Whalen is currently a consultant to Gateway Freight
Services, an entity providing freight forwarding services to major international
airlines. From 1965 until January 1996 Mr. Whalen was employed by Japan Airlines
in various management positions, including Staff Vice President-Cargo from
October 1986.

BOARD OF DIRECTORS

Upon the consummation of the Offering, the Board of Directors of the
Company will consist of seven members. Each director will hold office until the
annual meeting of the stockholders of the Company next following his election,
and until his successor is elected and qualified. The holders of a majority of
the outstanding shares of Common Stock present and entitled to vote at a meeting
of stockholders are entitled to elect all of the directors.

Directors who are employees of the Company do not receive additional
compensation for serving as directors. Each director who is not an employee of
the Company will receive an annual fee of $6,000 as compensation for his or her
services as a member of the Board of Directors. Non-employee directors will
receive an additional fee of $500 for each meeting of the Board of Directors
attended in person by such director and $250 for each telephonic meeting in
which such director participates. Non-employee directors who serve on a
committee of the Board of Directors will receive $500 for each committee meeting
attended in person and $250 for each telephonic committee meeting in which such
director participates. All directors of the Company are reimbursed for
out-of-pocket expenses incurred in attending meetings of the Board of Directors
or committees thereof, and for other expenses incurred in their capacities as
directors of the Company.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board of Directors has established two committees: a Compensation
Committee and an Audit Committee. Each of these committees has two or more
members who serve at the discretion of the Board of Directors. The Compensation
Committee is responsible for reviewing and making recommendations to the Board
of Directors with respect to compensation of executive officers, other
compensation matters and awards under the Company's stock option plan. The Audit
Committee is responsible for reviewing the Company's financial statements, audit
reports, internal financial controls and the services performed by the Company's
independent public accountants, and for making recommendations with respect to
those matters to the Board of Directors.

EXECUTIVE COMPENSATION

The following summary compensation table sets forth the total annual
compensation paid or accrued by the Company to or for the account of the Chief
Executive Officer and the other executive officer of the Company whose total
cash compensation for the fiscal year ended July 31, 1995 exceeded $100,000:

SUMMARY COMPENSATION TABLE

LONG TERM
COMPENSATION
AWARDS
ANNUAL -------------
COMPENSATION SECURITIES
---------------- UNDERLYING
NAME AND FISCAL SALARY BONUS OPTIONS
PRINCIPAL POSITION YEAR ($) ($) (#)
- -------------------------------------------------------- ------ ------- ----- -------------

Richard K. McClelland(1)
President and Chief Executive Officer................. 1995 22,050 -- 103,000
George M. Siegel(2)
Former Vice Chairman.................................. 1995 120,000 -- --

- ---------------

(1) Mr. McClelland was employed by the Company as of May 31, 1995, the date of
the Company's acquisition of Dynamex Express. Consequently, Mr. McClelland's
salary for fiscal year 1995 as set forth above represents only two months of
his annual salary. Had Mr. McClelland been employed for the entire twelve
months of fiscal year 1995, his salary for such year would have been
approximately $132,300.

(2) Mr. Siegel, a founder of the Company, resigned in July 1995.

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42

EMPLOYMENT AND CONSULTING AGREEMENTS

The Company has entered into an employment agreement with Mr. McClelland.
Such agreement provides for the payment of a base salary in the annual amount of
$200,000, participation in an executive bonus plan, an auto allowance of
approximately Cdn $900 per month and participation in other employee benefit
plans. The agreement also provides that upon Mr. McClelland's exercise of
certain stock options to purchase 48,000 shares of Common Stock, the Company
shall pay Mr. McClelland a bonus equal to the exercise price multiplied by the
number of shares to be purchased by virtue of such exercise. Unless terminated
earlier, the employment agreement shall continue until May 31, 2000, upon which
date, such agreement will be automatically extended for successive one-year
renewal terms unless the Company gives Mr. McClelland notice upon the terms
provided in such agreement. Additionally, upon a sale or transfer of
substantially all of the assets of the Company or certain other events that
constitute a change of control of the Company, including the acquisition by a
stockholder other than certain named stockholders of securities representing 15%
of the votes that may be cast for director elections, the Company or its
successor, as the case may be, shall continue to pay Mr. McClelland the
compensation set forth in such agreement for the greater of two years from the
date of such change of control or the remainder of the term of the agreement.

The Company has entered into a consulting agreement with Mr. Siegel which
provides for the payment of a consulting fee in the amount of $120,000 per year,
an auto allowance of $500 per month and participation in certain employee
benefit plans. The term expires on November 16, 1998. The Company is required to
pay the consulting fee to Mr. Siegel or his designated beneficiary for the three
month period following Mr. Siegel's death or total disability, provided that the
Company may offset any such amounts against any indebtedness that Mr. Siegel
owes to the Company at the time of such termination. See "Certain Transactions."

STOCK OPTION PLAN

The Company maintains the Dynamex Inc. 1996 Stock Option Plan (the "Option
Plan") which provides for the grant of options to eligible employees and
directors for the purchase of Common Stock of the Company. The Option Plan
covers, in the aggregate, a maximum of 630,000 shares of Common Stock. The
Option Plan provides for the granting of both incentive stock options (as
defined in Section 422A of the Internal Revenue Code of 1986) and nonqualified
stock options (options which do not meet the requirements of Section 422A). In
addition, the Option Plan provides for the granting of restricted stock, which
may include, without limitation, restrictions on the right to vote such shares
and restrictions on the right to receive dividends on such shares. The grant of
options to purchase such restricted stock may be based upon the attainment of
performance goals prescribed by the Compensation Committee of the Board of
Directors (the "Committee"). Under the Option Plan, the exercise price may not
be less than the fair market value of the Common Stock on the date of the grant
of the option.

The Committee administers and interprets the Option Plan and is authorized
to grant options thereunder to all eligible employees of the Company, including
officers. The Committee designates the optionees, the number of shares subject
to the options and the terms and conditions of each option. Options under the
Option Plan generally vest over a five year period. Certain changes in control
of the Company will cause the options to vest immediately. Each option granted
under the Option Plan must be exercised, if at all, during a period established
in the grant which may not exceed 10 years from the date of grant. An optionee
may not transfer or assign any option granted and may not exercise any options
after a specified period subsequent to the termination of the optionee's
employment with the Company.

Non-employee members of the Board of Directors will receive annual grants
of options under the Option Plan. The initial grant to such directors shall
consist of options to purchase 2,000 shares of Common Stock at fair market value
and shall be granted upon the later of (i) the closing of the Offering or (ii)
the date such director is initially elected. Thereafter, on the anniversary of
the initial grant, options to purchase 2,000 shares of Common Stock at the then
fair market value will be automatically granted to each director then serving.
Such options will be immediately vested in full. Each option granted to
directors under the Option Plan must be exercised, if at all, during a period
established in the grant, which may not exceed 10 years from the date of grant.
An optionee may not transfer or assign any options granted and may not exercise
any options after a

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43

specified period subsequent to the termination of the optionee's service on the
Board of Directors. Any options granted to an optionee will immediately
terminate upon removal of such optionee from the Board of Directors for cause.

Upon completion of the Offering, options to purchase 473,384 shares will be
outstanding and (i) 214,384 of these options have a weighted average exercise
price of $3.84 per share and expire between November 2003 and July 2005 and (ii)
259,000 of these options (which will be granted in connection with the Offering
and are exercisable at the initial public offering price) expire in July 2006
(99,000 of which will be granted to Mr. McClelland). A total of 156,616 shares
remained available for future grants under the Option Plan.

OPTION GRANTS

The following table sets forth, as to each executive officer named in the
Summary Compensation Table above, the number of shares of Common Stock subject
to options granted during the year ended July 31, 1995 and the per share
exercise price for such options.

OPTION GRANTS IN FISCAL 1995

POTENTIAL
REALIZABLE VALUE
AT ASSUMED ANNUAL
PERCENT OF RATES OF STOCK
NUMBER OF TOTAL PRICE APPRECIATION
SECURITIES OPTIONS EXERCISE OR FOR OPTION
UNDERLYING GRANTED TO BASE TERM($)(3)
OPTIONS EMPLOYEES PRICE EXPIRATION ------------------
NAME GRANTED(1) IN FISCAL YEAR ($/SHARE) DATE 5% 10%
- ------------------------------ ----------- -------------- ----------- ---------- ------- --------

Richard K. McClelland......... 103,000(2) 74% $4.25 5/31/2005 275,000 697,310
George M. Siegel.............. -- -- -- -- -- --

- ---------------

(1) All options were granted under the Option Plan.

(2) Includes options to acquire 48,000 shares of Common Stock which are
immediately exercisable and were granted to Mr. McClelland pursuant to his
employment agreement with the Company. Under such employment agreement, at
the time of Mr. McClelland's exercise of all or any of these options, the
Company has agreed to pay Mr. McClelland a cash bonus equal to the exercise
price multiplied by the number of shares to be purchased by virtue of such
exercise. Also includes options to acquire 11,000 shares of Common Stock
that became exercisable on May 31,1996 as the first tranche of a five year
vesting schedule and options to acquire 44,000 shares of Common Stock which
will vest ratably over the remaining four years of such vesting schedule,
with 25% of the balance becoming exercisable on each May 31, 1997, 1998,
1999 and 2000.

(3) The amounts shown as potential realizable values are based on assumed
annualized rates of appreciation in the price of Common Stock of five
percent and ten percent over the term of the options, as set forth in the
rules of the Securities and Exchange Commission. Actual gains, if any, on
stock option exercises are dependent upon the future performance of the
Common Stock. There can be no assurance that the potential realizable values
reflected in this table will be achieved.

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FISCAL YEAR-END OPTION VALUES

The following table sets forth information with respect to the unexercised
options to purchase shares of the Company's Common Stock granted under the
Option Plan to the executive officers and held by them at July 31, 1995.

FISCAL YEAR-END OPTION VALUES

AS OF JULY 31, 1995
---------------------------------------------------------------
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS
----------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------------------- ----------- ------------- ----------- -------------

Richard K. McClelland....................... 48,000 55,000 $ 324,000(2) $ 371,250
George M. Siegel............................ 34,954 52,430 271,243 406,857

- ---------------

(1) Based on an assumed initial public offering price of $11.00 per share, less
the exercise price payable for such shares.

(2) Does not give effect to the Company's agreement to pay a cash bonus to Mr.
McClelland upon his exercise of his option to purchase all or any of these
48,000 shares of Common Stock equal to the exercise price multiplied by the
number of shares to be purchased by virtue of such exercise.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation Committee of the Company's Board of Directors consists of
two members, Messrs. Smiley and Hughes. Mr. Bishop, a nominee for director, will
become a member of the Compensation Committee concurrently with his election to
the Board of Directors upon the completion of the Offering. No member of the
Committee was at any time during the fiscal year ended July 31, 1995 an officer
or employee of the Company. Mr. Smiley was a Vice President of the Company from
December 1995 through February 1996. No executive officer of the Company serves
as a member of the board of directors or compensation committee of any entity
which has one or more executive officers serving as a member of the Company's
Board of Directors or Compensation Committee.

LIMITATION ON LIABILITY AND INDEMNIFICATION MATTERS

The Company's Restated Certificate of Incorporation limits the liability of
directors of the Company to the Company or its stockholders to the fullest
extent permitted by Delaware General Corporation Law (the "DGCL"). Accordingly,
pursuant to the terms of the DGCL presently in effect, the Company's directors
will not be liable to the Company or its stockholders for monetary damages for
breach of the directors' fiduciary duty as a director, except for liability (i)
for any breach of the directors' duty of loyalty to the Company or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) in respect of
certain unlawful dividend payments or stock redemptions or repurchases or (iv)
for any transaction from which the director derived an improper personal
benefit. The effect of these provisions will be to eliminate the rights of the
Company and its stockholders (through stockholders' derivative suits on behalf
of the Company) to recover monetary damages against a director for breach of
fiduciary duty as a director (including breaches resulting from grossly
negligent behavior), except in the situations described above. These provisions
will not limit the liability of directors under federal securities laws. Such
limitation of liability does not affect the availability of equitable remedies
such as injunctive relief or rescission.

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45

under the law. The Company is also required to advance to such persons payment
for their expenses incurred in defending a proceeding to which indemnification
might apply, provided the recipient provides an undertaking agreeing to repay
all such advanced amounts if it is ultimately determined that he is not entitled
to be indemnified.

The Company has also entered into indemnification agreements with each of
its directors and certain of its executive officers. Pursuant to these
agreements, the Company is obligated, to the extent permitted by law, to
indemnify these persons against all expenses, judgments, fines and penalties
incurred in connection with the defense or settlement of any actions brought
against them by reason of the fact that they are or were directors or officers
of the Company or that they are or were serving at the request of the Company as
an officer or director of another corporation or enterprise, except that if the
acts of such an indemnitee are found by a court of proper jurisdiction to be
intentional or willful, the Company will not be liable to indemnify such
indemnitee.

As of this date hereof, there is no pending litigation or proceeding
involving a director, officer, employee or agent of the Company where
indemnification will be required or permitted, and the Company is not aware of
any threatened litigation or proceeding which may result in a claim for such
indemnification.

CERTAIN TRANSACTIONS

In private placements of the Company's securities conducted from November
16, 1993 through May 31, 1995, Cypress, which was not affiliated with the
Company prior to its initial investment in November 1993, acquired an aggregate
of 2,021,752 shares of Common Stock (after giving effect to the May 1995
conversion of the Company's convertible preferred stock held by Cypress) for
aggregate consideration of approximately $7.0 million, including interest and
dividends accrued on such preferred stock. James M. Hoak, a director of the
Company, is the Chairman and sole stockholder of the general partner of Cypress
and such general partner owns a 5% partnership interest in Cypress.
Additionally, Mr. Hoak is a limited partner owning a 45% interest in Cypress.

In December 1995, in connection with the acquisition of Mayne Nickless, the
Company issued $4.5 million of Bridge Notes including (i) $1.0 million to
Cypress, (ii) an aggregate of approximately $1.8 million to various limited
partners of Cypress (including Preferred Risk Mutual Insurance Company and
Preferred Risk Life Insurance Company (each a stockholder of the Company and an
employer of Brian J. Hughes, a director of the Company) and Stephen P. Smiley (a
director of the Company) and certain affiliates of Cypress' general partner and
(iii) an aggregate of approximately $1.8 million to James M. Hoak and the
general partner of Cypress. The holders of the Bridge Notes received the Bridge
Warrants, which enable the holders to purchase an aggregate of 1,080,000 shares
of Common Stock at a price of $.025 per share, which number of shares will be
reduced to 540,000 in the event that the Company has redeemed the Bridge Notes
by June 30, 1996, which date shall be extended to a date not later than December
31, 1996 if the Company is actively engaged in the initial public offering
process during such time. The shares of Common Stock and the Bridge Warrant held
by Cypress have been pledged to the Company's senior lender under the Credit
Agreement. However, the Company intends to use a portion of the proceeds of the
Offering to retire a portion of the outstanding indebtedness under the Credit
Agreement and the lender has agreed to surrender its rights with respect to such
securities upon such repayment. See "Use of Proceeds", "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and "Principal
Stockholders."

To finance his acquisition of Common Stock, George M. Siegel issued to the
Company, (i) a promissory note dated November 16, 1993 in the original principal
amount of $100,000, bearing interest at a rate of 8%, which note has been paid
in full, and (ii) a promissory note dated May 31, 1995, in the original
principal amount of $84,950, bearing interest at a rate of 8%, which note has
been paid in full.

The Company paid Hoak Capital Corporation fees in the aggregate amount of
approximately $146,000 in fiscal 1995 for advisory services rendered in
connection with certain acquisitions and financing arrangements. In January
1996, the Company paid Hoak Securities Corp. a fee of $70,000 for investment
banking services rendered in connection with the Company's acquisition of Mayne
Nickless and $165,000 for the arrangement of bank financing related to that
acquisition.

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In May 1995, the Company purchased Dynamex Express from Air Canada for
approximately Cdn $10.5 million. Richard K. McClelland, who was the chief
executive officer of Dynamex Express and unaffiliated with the Company at the
time of such transaction, became the chief executive officer and a director of
the Company upon consummation of such transaction.

The Company has entered into an agreement with Kenneth H. Bishop for the
purchase of all of the outstanding stock of Zipper for an aggregate purchase
price of approximately Cdn $2.5 million (approximately $1.8 million, as
converted using an exchange rate of 0.73 U.S. dollars to 1.00 Canadian dollars)
in cash and 41,398 shares of Common Stock (assuming an initial public offering
price of $11.00). In addition, simultaneously with the closing of such
Acquisition, the Company will repay Zipper's bank indebtedness of approximately
Cdn $445,000 (approximately $325,000, as converted using an exchange rate of
0.73 U.S. dollars to 1.00 Canadian dollars). Mr. Bishop has not been affiliated
with the Company prior to the Acquisition and will become a director of the
Company upon the consummation thereof. See "Business -- Pending Acquisitions."

The Company believes that all of the transactions set forth above were made
on terms no less favorable to the Company than could have been obtained from
unaffiliated third parties. All future transactions, including loans, between
the Company and its officers, directors, principal stockholders and affiliates,
will be approved by a majority of the Board of Directors, including a majority
of the independent and disinterested outside directors, and have been and will
be on terms no less favorable to the Company than could be obtained from
unaffiliated third parties.

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PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of (i) May 31, 1996 and (ii) as
adjusted to reflect (a) the sale of Common Stock being offered by the Company
hereby, (b) the issuance of shares of Common Stock upon the mandatory exercise
of the Bridge Warrants, (c) the issuance of shares of Common Stock as partial
consideration for the Acquisitions, assuming an initial offering price of $11.00
and (d) the issuance of immediately exercisable stock options to non-employee
directors, concurrently with the Offering for (1) each person known by the
Company to own beneficially more than 5% of the Common Stock, (2) each director,
nominee for director and executive officer of the Company and (3) all directors,
nominees for director and executive officers of the Company as a group. Except
pursuant to applicable community property laws and except as otherwise
indicated, each stockholder identified in the table possesses sole voting and
investment power with respect to its or his shares.

SHARES BENEFICIALLY OWNED(1)(2)
------------------------------------------------------
PERCENT
----------------------------------------
NAME NUMBER BEFORE OFFERING(3) AFTER OFFERING(4)
- ------------------------------------------------- --------- ------------------ -----------------

DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS:
Richard K. McClelland............................ 59,000 2.3% *
Robert P. Capps.................................. -- -- --
James M. Hoak(5)(7).............................. 2,353,752 81.8 37.3%
Stephen P. Smiley................................ 4,160 * *
Wayne Kern....................................... 4,640 * *
Brian J. Hughes(6)............................... 2,000 -- *
Kenneth H. Bishop................................ 43,398 -- *
E. T. Whalen..................................... 2,000 -- *
All directors, nominees for director and
executive officers as a group (8
individuals)................................... 2,468,950 82.2 38.7
OTHER 5% STOCKHOLDERS:
Cypress Capital Partners I, L.P.(7).............. 2,141,752 80.4 33.9
One Galleria Tower,
Suite 1650, 13355 Noel Road,
Dallas, Texas 75240
Preferred Risk Mutual Insurance Company(8)....... 336,116 13.0 5.3
111 Ashworth Road
West Des Moines, Iowa 50265
George M. Siegel(9).............................. 257,546 10.0 4.1

- ---------------

* Indicates less than 1%

(1) Includes shares issuable upon the exercise of stock options outstanding.

(2) Includes shares issuable upon the mandatory exercise of the Bridge Warrants
upon the completion of the Offering.

(3) Based upon 2,543,460 shares of Common Stock outstanding upon the completion
of this Offering, plus shares issuable upon the exercise of options and
Bridge Warrants which are included in the number of shares beneficially
owned by such person.

(4) Based upon 6,309,630 shares of Common Stock outstanding upon the completion
of this Offering, plus shares issuable upon the exercise of options which
are included in the number of shares beneficially owned by such person.

(5) Mr. Hoak's address is One Galleria Tower, Suite 1650, 13355 Noel Road,
Dallas, Texas 75240. Includes 2,141,752 shares owned by Cypress, of which
Mr. Hoak is the Chairman and sole shareholder of its 5% general partner and
a 45% limited partner. Excludes 4,800 shares issuable upon the mandatory
exercise of the Bridge Warrants owned by Mr. Hoak's wife, as to which shares
Mr. Hoak disclaims beneficial ownership.

(6) Excludes 336,116 shares beneficially owned by Preferred Risk Life Insurance
Company and Preferred Risk Mutual Insurance Company, each of which employs
Mr. Hughes as Vice President- Investments. Mr. Hughes disclaims beneficial
ownership of such shares.

(7) Includes 2,141,752 shares beneficially owned by James M. Hoak in his
capacity as the Chairman and sole shareholder of the general partner of
Cypress. The shares and Bridge Warrants held by Cypress have been pledged to
the Company's senior lender under the Credit Agreement. However, the Company
intends to use a portion of the proceeds of the Offering to retire a portion
of the outstanding indebtedness under the Credit Agreement. The lender has
agreed to release the pledge with respect to such securities in the event of
such repayment. See "Use of Proceeds" and "Management 's Discussion and
Analysis of Financial Condition and Results of Operations."

(8) Includes 168,056 shares beneficially owned by its affiliate Preferred Risk
Life Insurance Company.

(9) Mr. Siegel's address is 37801 N. Stirrup Circle, Carefree, Arizona 85377.
Mr. Siegel, founder of the Company, resigned as a director and officer of
the Company in July 1995.

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DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 60,000,000 shares of
capital stock, par value $.01 per share, of which 50,000,000 are Common Stock
and 10,000,000 are Preferred Stock. A total of 500,000 shares of Preferred Stock
have been designated as Series A Junior Participating Preferred Stock (the
"Series A Preferred Stock") by the Board of Directors in connection with the
Rights Agreement discussed below. As of June 30, 1996, there were 2,543,460
shares of Common Stock outstanding held by four holders of record, and there
were no shares of Preferred Stock outstanding.

The following description of the Company's capital stock does not purport
to be complete and is subject in all respects to applicable Delaware law and to
the provisions of the Company's Restated Certificate of Incorporation, Bylaws
and Rights Agreement, in each case as amended to date.

COMMON STOCK

The holders of Common Stock are entitled to one vote per share on all
matters submitted to a vote of stockholders, including the election of
directors. The Common Stock does not have cumulative voting rights, which means
that the holders of a majority of the shares voting for election of directors
can elect all members of the Board of Directors. Dividends may be paid ratably
to holders of Common Stock when and if declared by the Board of Directors out of
funds legally available therefor. Upon liquidation or dissolution of the
Company, the holders of Common Stock will be entitled to share ratably in the
assets of the Company legally available for distribution to stockholders after
payment of all liabilities and the liquidation preferences of any outstanding
Preferred Stock.

The holders of Common Stock have no preemptive or conversion rights or
other subscription rights and are not subject to redemption or sinking fund
provisions or to calls or assessments by the Company. The shares of Common Stock
offered hereby will be, when issued and paid for, fully paid and not liable for
call or assessment. The Common Stock offered hereby has been approved for
quotation and trading on the Nasdaq National Market.

PREFERRED STOCK

Under governing Delaware law and the Company's Restated Certificate of
Incorporation, no action by the Company's stockholders is necessary, and only
action of the Board of Directors is required, to authorize the issuance of any
of the Preferred Stock. The Board of Directors is empowered to establish, and to
designate the name of, each class or series of the Preferred Stock.

Shares of Series A Preferred Stock purchasable upon exercise of the Rights
will not be redeemable. Each share of Series A Preferred Stock will be entitled
to a minimum preferential quarterly dividend payment of $0.25 per share but will
be entitled to an aggregate dividend of 100 times the dividend declared per
share of Common Stock. In the event of liquidation, the holders of the shares of
Series A Preferred Stock will be entitled to a minimum preferential liquidation
payment of $1 per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment,
provided that the holders of the shares of Series A Preferred Stock shall be
entitled to an aggregate payment of 100 times the payment made per share of
Common Stock, as adjusted to reflect any dividend on the Common Stock payable in
shares of Common Stock or any subdivision, combination or reclassification of
the Common Stock. Each share of Series A Preferred Stock will have 100 votes,
voting together with the Common Stock. Finally, in the event of any merger,
consolidation or other transaction in which shares of Common Stock are
exchanged, each share of Series A Preferred Stock will be entitled to receive
100 times the amount received per share of Common Stock. These rights are
protected by customary antidilution provisions.

Although the Company has no present plans to issue additional series of
Preferred Stock (other than shares which may be issued in connection with the
Rights Agreement), such shares may be issued from time to time in one or more
classes or series with such designations, powers, preferences, rights,
qualifications, limitations and restrictions as may be fixed by the Company's
Board of Directors. The Board of Directors, without obtaining stockholder
approval, may issue such shares with voting or conversion rights or both and

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thereby dilute the voting power and equity of the holders of Common Stock and
adversely affect the market price of such stock.

The existence of authorized Preferred Stock may have the effect of
discouraging an attempt, through acquisition of a substantial number of shares
of Common Stock, to acquire control of the Company with a view to effecting a
change in control of the Company, a merger, sale or exchange of assets or a
similar transaction. The anti-takeover effects of authorized Preferred Stock may
deny stockholders the receipt of a premium on their Common Stock and may also
have a depressive effect on the market price of the Common Stock.

RIGHTS AGREEMENT

In June 1996, the Board of Directors of the Company approved a Rights
Agreement which is designed to protect stockholders should the Company become
the target of coercive and unfair takeover tactics. Pursuant to the Rights
Agreement, the Board of Directors declared a dividend of one preferred stock
purchase right (a "Right") for each outstanding share of Common Stock on May 31,
1996. Each Right entitles the registered holder to purchase from the Company one
one-hundredth of a share of the Series A Preferred Stock, at a price of $45.00
per one one-hundredth of a share of Series A Preferred Stock, subject to
possible adjustment.

Initially, the Rights are attached to all Common Stock certificates and no
separate Rights certificates exist. Until the Rights become separable as
described below, an additional Right will be issued with every share of newly
issued Common Stock, including the shares of Common Stock issued pursuant to the
Offering. Until a Right is exercised, the holder of a Right will have no rights
as a stockholder of the Company, including the right to vote or to receive
dividends. The Rights will expire on May 31, 2006 (the "Final Expiration Date"),
unless the Final Expiration Date is extended or unless the Rights are earlier
redeemed or exchanged by the Company, in each case as described below.

The Rights will become exercisable and separable from shares of Common
Stock upon the earlier to occur of (i) 10 days after the first public
announcement that a person or group (an "Acquiring Person"), other than the
Company, any subsidiary of the Company or any employee benefit plan of the
Company or Cypress, James M. Hoak (or any affiliates thereof), has become the
beneficial owner of 15% or more of the outstanding shares of Common Stock or
(ii) 10 business days (or such later date as may be determined by action of the
Board of Directors prior to the time any person or group becomes an Acquiring
Person) after the commencement of, or the announcement of an intention to
commence, a tender or exchange offer the consummation of which would result in
any person or group (other than the Company, any subsidiary of the Company or
any employee benefit plan of the Company) becoming the beneficial owner of 15%
or more of such outstanding shares of Common Stock.

In the event that any person or group becomes the beneficial owner of 15%
or more of the shares of Common Stock then outstanding, each registered holder
of a Right will have the right to receive upon exercise of Right at the then
current purchase price of the Right that number of shares of Common Stock of the
Company having a market value of two times such purchase price. Notwithstanding
the foregoing, after the occurrence of the event described in this paragraph,
all Rights which are, or (under certain circumstances specified in the Rights
Agreement) were, beneficially owned by an Acquiring Person will be void. Under
no circumstances may a Right be exercised following the occurrence of a
transaction described in this paragraph prior to the expiration of the Company's
right of redemption.

In the event that, on or after the first public announcement by the Company
or an Acquiring Person that an Acquiring Person has become such (the "Share
Acquisition Date"), the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold or transferred (in one transaction or a series of transactions
other than in the ordinary course of business), each registered holder of a
Right (except Rights which have become void as specified above) will thereafter
have the right to receive, upon the exercise thereof at the then current
purchase price of the Right, the number of shares of common stock of the
acquiring company (or of another person or group affiliated with the Acquiring
Person as provided in the Rights Agreement) which at the time of such
transaction will have a market value of two times such purchase price.

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50

At any time after any person becomes an Acquiring Person and prior to the
time such person or group becomes the beneficial owner of 50% or more of the
outstanding shares of Common Stock, the Board of Directors of the Company may
exchange the Rights (other than Rights which have become void), in whole or in
part, at the exchange rate of one share of Common Stock, or one one-hundredth of
a share of Series A Preferred Stock (or of a share of a class or series of the
Company's preferred stock having equivalent rights, preferences and privileges),
per Right, subject to adjustment as provided in the Rights Agreement.

At any time prior to the earlier of (i) the 10th business day after the
Share Acquisition Date, subject to one or more extensions by a majority of the
Disinterested Directors (as defined) and (ii) the Final Expiration Date, the
Board of Directors of the Company may redeem the Rights in whole, but not in
part, at a redemption price of $.01 per Right, appropriately adjusted to reflect
any stock split, stock dividend, subdivision or combination or any similar
transaction occurring after the date of the Rights Agreement (the "Redemption
Price"); provided, however, that, under certain circumstances specified in the
Rights Agreement, the Rights may not be redeemed unless there are Disinterested
Directors in office and such redemption is approved by a majority of such
Disinterested Directors. The redemption of the Rights may be made effective at
such time, on such basis and with such conditions as the Board of Directors in
its sole discretion shall establish. After the redemption period has expired,
the Company's right of redemption may be reinstated, under the circumstances
specified in the Rights Agreement, which include the concurrence of a majority
of the Disinterested Directors, if an Acquiring Person shall have reduced to 10%
or less the number of outstanding shares of Common Stock beneficially owned in a
transaction or series of transactions not involving the Company and not
constituting specified transactions which result in a discounted purchase price
under the Rights Agreement. Immediately after any action by the Board of
Directors directing the redemption of the Rights, the right to exercise the
Rights shall terminate and thereafter the registered holders of the Rights shall
be entitled to receive only the Redemption Price per Right.

The term "Disinterested Director" means any member of the Company's Board
of Directors who is unaffiliated with an Acquiring Person and was a member of
the Company's Board of Directors prior to the time that an Acquiring Person
became such and any successor of a Disinterested Director who is unaffiliated
with an Acquiring Person and is recommended to succeed a Disinterested Director
by a majority of Disinterested Directors then on the Company's Board of
Directors.

The Rights have certain anti-takeover effects. The Rights could cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on redemption of the Rights or on substantially
all of the Rights also being acquired. The Rights should not, however, interfere
with any merger or other business combination approved by the Board of Directors
of the Company since the Rights may be redeemed or amended by the Company as
described above.

SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW

The Company is a Delaware corporation and is subject to the provisions of
Section 203 of the Delaware General Corporation Law. In general, Section 203
provides that a Delaware corporation may not engage in any of a broad range of
business combinations with a person or affiliate or associate of such person who
is an "interested stockholder" (defined generally as a person who together with
affiliates and associates, own (or within three years, did own) 15% or more of a
corporation's outstanding voting stock) unless: (a) the transaction resulting in
a person's becoming an interested stockholder, or the business combination, is
approved by the board of directors of the corporation before the person becomes
an interested stockholder; (b) the interested stockholder acquires 85% or more
of the outstanding voting stock of the corporation in the same transaction that
makes it an interested stockholder; or (c) on or after the date the person
becomes an interested stockholder, the business combination is approved by the
corporation's board of directors and by the holders of at least 66 2/3% of the
corporation's outstanding voting stock at an annual or special meeting,
excluding shares owned by the interested stockholder.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Company's Common Stock is Harris
Trust and Savings Bank.

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SHARES ELIGIBLE FOR FUTURE SALE

The Company has outstanding 2,543,460 shares of Common Stock. In addition,
the Company has 473,384 shares reserved for issuance upon exercise of options
granted or to be granted in connection with the Offering under the Company's
Stock Option Plan, 110,754 of which are immediately exercisable, and 540,000
shares reserved for issuance upon the mandatory exercise of the Bridge Warrants
concurrently with the consummation of the Offering. Of the 6,309,630 shares to
be outstanding after the Offering, the 3,100,000 shares sold to the public
hereby will be freely tradeable without restrictions or registration under the
Securities Act, except that any shares purchased by "affiliates" of the Company,
as that term is defined in Rule 144 ("Rule 144") under the Securities Act
("Affiliates") may generally only be sold in compliance with the limitations of
Rule 144 described below. An aggregate of 126,170 shares will be issued in
connection with the Acquisitions. The Company has agreed to register these
shares under the Securities Act within 30 days after the closing of the
Acquisitions in order to permit the resale of such shares in the open market
from time to time and has agreed to maintain the effectiveness of such
registration for two years. Following the sale of such shares pursuant to an
effective registration statement, these shares, other than shares acquired by
Affiliates, shall be freely tradeable. The remaining 3,083,460 shares (including
540,000 shares to be issued upon the mandatory exercise of the Bridge Warrants)
were issued and sold by the Company in private transactions in reliance upon
exemptions from registration under the Securities Act and are, therefore deemed
"restricted securities" under Rule 144 which may not be sold publicly unless the
shares are registered under the Securities Act or are sold under Rule 144 or
another similar exemption. Under Rule 144, substantially all of the remaining
restricted securities will become eligible for resale in accordance with the
terms of Rule 144 90 days after the date the Company becomes subject to the
reporting requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act").

In general, under Rule 144 a person (or persons whose sales are aggregated)
who beneficially owns restricted securities for at least two years and any
Affiliate who beneficially owns restricted securities for at least two years or
any other shares not constituting restricted securities without regard to such
two-year holding period, is entitled to sell within any three-month period a
number of shares that does not exceed the greater of 1% of the then outstanding
shares of the Company's Common Stock or the average weekly trading volume in the
Company's Common Stock during the four calendar weeks preceding such sale. Sales
under Rule 144 are also subject to certain manner-of-sale provisions, notice
requirements and the availability of current public information about the
Company. A person who has not been an affiliate of the Company at any time
during the three months preceding a sale, and who beneficially owns shares last
acquired from the Company or an affiliate of the Company at least three years
previously is entitled to sell all such shares under Rule 144 without regard to
any of the limitations of the Rule.

After the Offering, under the terms of agreements between the Company and
its principal stockholders entered into in connection with the issuance of the
Company's equity securities, if the Company proposes to register any of its
securities under the Securities Act, either for its own account or for the
account of other stock holders exercising registration rights, such holders are
entitled to notice of such registration and are entitled to include certain
shares of Common Stock therein. In addition, Cypress may require the Company on
a date after the sixth month anniversary of the Offering to file a registration
statement under the Securities Act at the Company's expense with respect to the
resale from time to time of its shares of Common Stock. If Cypress exercises
this right, the Company would be required to use its best efforts to effect such
registration, subject to certain conditions and limitations. These rights are
subject to certain conditions and limitations, among them the right of the
underwriters of an offering to limit the number of shares included in any such
registration. To the extent their shares of Common Stock are not offered hereby,
the holders of these registration rights have waived such rights in regard to
the Offering.

The Company, the Company's executive officers and directors, previous
owners of the Acquired Companies to whom shares of Common Stock are being issued
in connection with the Acquisitions, and stockholders of the Company that own 1%
or more of the Common Stock outstanding prior to the Offering have agreed not to
offer, sell, contract to sell or otherwise dispose of any shares of Common Stock
or any securities exercisable for or convertible into Common Stock for a period
of 180 days after the date of this Prospectus without the prior written consent
of William Blair & Company, L.L.C.

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52

The Company cannot predict the effect, if any, that sales of restricted
securities or the availability of such securities for sale could have on the
market price, if any, prevailing from time to time. Nevertheless, sales of
substantial amounts of the Company's securities, including the securities
offered hereby, could adversely affect prevailing market prices of the Company's
securities and the Company's ability to raise additional capital by occurring at
a time when it would be beneficial for the Company to sell securities.

Upon the expiration of the 180-day period described above, certain shares
issued or issuable upon the exercise of options granted prior to the date of
this Prospectus also may be issuable for sale in the public market pursuant to
Rule 701 under the Securities Act. In general, Rule 701 permits resales of
shares issued pursuant to certain compensatory benefit plans and contracts
commencing at the end of the 90 day period after the Company becomes subject to
the reporting requirements of the Exchange Act. If all of the requirements of
Rule 701 are satisfied, and upon completion of the 180-day period, an additional
105,924 shares of Common Stock issuable upon the exercise of currently
outstanding options or options to be granted in connection with the Offering
which are immediately exercisable will be eligible for sale.

The Company intends to file a registration statement under the Securities
Act to register all shares of Common Stock issuable pursuant to the Option Plan.
See "Management -- Stock Option Plan." Subject to the completion of the 180-day
period described above, shares of Common Stock issued after the effective date
of such registration statement upon the exercise of awards issued under such
plan generally will be eligible for sale in the public market.

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UNDERWRITING

The several underwriters named below (the "Underwriters"), for whom William
Blair & Company, L.L.C. and Hoak Securities Corp. are acting as representatives
(the "Representatives"), have severally agreed, subject to the terms and
conditions set forth in the underwriting agreement by and among the Company and
the Representatives (the "Underwriting Agreement"), to purchase from the
Company, and the Company has agreed to sell to the Underwriters, the respective
number of shares of Common Stock (excluding the over-allotment shares) set forth
opposite each Underwriter's name below:

NUMBER OF
UNDERWRITERS SHARES
------------------------------------------------------------------ ---------

William Blair & Company, L.L.C. ..................................
Hoak Securities Corp. ............................................

---------
Total........................................................ 3,100,000
=========

The nature of the Underwriters' obligations under the Underwriting
Agreement is such that all shares of Common Stock being offered, excluding
shares covered by the over-allotment option granted to the Underwriters, must be
purchased if any are purchased. In the event of a default by any Underwriter,
the Underwriting Agreement provides that, in certain circumstances, purchase
commitments of the nondefaulting Underwriters pertaining to the Underwriting
Agreement may be increased or such Underwriting Agreement may be terminated.

The Representatives have advised the Company that they propose to offer the
shares of Common Stock directly to the public initially at the public offering
price set forth on the cover page of this Prospectus and to selected dealers at
such price less a concession of not more than $ per share. Additionally, the
Underwriters may allow, and such dealers may reallow, a concession not in excess
of $ per share to certain other dealers. After the initial public offering
of the Common Stock, the public offering price and other selling terms may be
changed by the Representatives.

The Company has granted the Underwriters an option, exercisable within 30
days after the date of this Prospectus, to purchase up to an additional 465,000
shares of Common Stock at the same price per share to be paid by the
Underwriters for the other shares offered hereby. If the Underwriters purchase
any of such additional shares pursuant to this option, each Underwriter will be
committed to purchase such additional shares in approximately the same
proportion as set forth in the table above. The Underwriters may exercise the
option only for the purpose of covering over-allotments, if any, made in
connection with the distribution of the shares of Common Stock offered hereby.

The Company, the Company's directors and officers, certain stockholders of
the Company and the stockholders of Acquired Companies to whom shares of Common
Stock are being issued have agreed not to offer, sell, contract to sell or
otherwise dispose of any shares of Common Stock or any securities exercisable
for or convertible into Common Stock for a period of 180 days after the
effective date of the Registration Statement of which this Prospectus is a part
without the written consent of William Blair & Company, L.L.C., except for the
shares of Common Stock offered hereby and the sale of shares pursuant to the
over-allotment option. See "Shares Eligible for Future Sale."

There has been no public market for the shares of Common Stock prior to
this Offering. The initial public offering price for the Common Stock will be
determined by negotiations among the Company and the Representatives. Among the
factors to be considered in determining the initial public offering price are
prevailing market and economic conditions, revenues and earnings of the Company,
estimates of the

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Company's business potential and prospects, the present state earnings of the
Company's business operations, an assessment of the Company's management and the
consideration of the above factors in relation to the market valuations of
companies in related businesses.

The Representatives have informed the Company that the Underwriters will
not confirm, without customer authorization, sales to their customer accounts as
to which they have discretionary authority.

The Company has agreed to indemnify the Underwriters and their controlling
persons against certain liabilities, including liabilities under the Securities
Act, or to contribute to payments the Underwriters may be required to make in
respect thereof.

James M. Hoak and Wayne Kern, directors of the Company, are the Chairman
and President, respectively, of Hoak Securities Corp., one of the
Representatives. Both Hoak Securities Corp. and the general partner of Cypress
are wholly-owned by Mr. Hoak. In addition, Mr. Hoak owns a 45% limited
partnership interest in Cypress. Accordingly, Hoak Securities Corp. is deemed to
be an affiliate of the Company for purposes of the NASD Conduct Rules. The
Company intends to use a portion of the net proceeds of this Offering to prepay
$4.5 million principal amount of indebtedness owed under the Bridge Facility to
Cypress, various limited partners of Cypress and certain affiliates of Cypress'
general partner. See "Use of Proceeds," "Management," "Certain Transactions" and
"Principal Stockholders."

As members of the National Association of Securities Dealers, Inc.
("NASD"), William Blair & Company, L.L.C. and Hoak Securities Corp. are
underwriting this Offering in compliance with the applicable provisions of
Section 2720 of the NASD Conduct Rules. In connection therewith, William Blair &
Company, L.L.C. is acting as a qualified independent underwriter for purposes of
determining the initial public offering price per share of Common Stock. In its
role as a qualified independent underwriter, William Blair & Company, L.L.C. has
performed a due diligence investigation and reviewed and participated in the
preparation of this Prospectus and the Registration Statement of which this
Prospectus is a part. The initial public offering price set forth on the cover
page of this Prospectus is no higher than the price recommended by William Blair
& Company, L.L.C.

LEGAL MATTERS

The validity of the Common Stock offered hereby will be passed upon for the
Company by Crouch & Hallett, L.L.P., Dallas, Texas. Bruce H. Hallett, a partner
of Crouch & Hallett, L.L.P., is a limited partner in Cypress and beneficially
owns less than 1% of the Bridge Warrants, Bridge Notes and Common Stock of the
Company. Certain legal matters related to the Offering will be passed on for the
Underwriters by Sonnenschein Nath & Rosenthal, Chicago, Illinois.

EXPERTS

The (i) consolidated financial statements of Dynamex Inc. and subsidiaries
as of July 31, 1994 and 1995 and April 30, 1996 and for each of the years in the
three-year period ended July 31, 1995 and for the nine months ended April 30,
1996, (ii) the statement of operations and changes in financial position of
Dynamex Express Inc. for the five months ended May 31, 1995, (iii) the financial
statements of each of K.H.B. & Associates Ltd., Action Delivery and Messenger
Service Limited, Southbank Courier, Inc. and Seko Enterprises, Inc. and Related
Companies as of December 31, 1995 and 1994 and for each of the years in the two
year period ended December 13, 1995 have been audited by Deloitte & Touche,
independent auditors, as stated in their reports appearing herein and elsewhere
in this Registration Statement. Such financial statements are included herein in
reliance upon such reports given upon the authority of such firm as experts in
accounting and auditing.

The (i) combined financial statements of Seidel Delivery for the years
ended December 31, 1994 and 1995 and (ii) the combined statements of operations
and cash flows of Mayne Nickless Courier (a wholly owned business of Mayne
Nickless Transport, North America until December 28, 1995) for the six months
ended December 28, 1995 and each of the three fiscal years in the period ended
July 2, 1995 included in this Prospectus have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their reports

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herein (which report on the combined statements of operations and cash flows of
Mayne Nickless Courier expresses an unqualified opinion and includes an
explanatory paragraph referring to Mayne Nickless Courier's basis of
presentation), and have been so included in reliance upon the reports of such
firm given upon their authority as experts on accounting and auditing.

The statements of operations and changes in financial position of Dynamex
Express Inc. for each of the three years in the period ended December 31, 1994
have been audited by Price Waterhouse, independent auditors, as stated in their
reports appearing herein and elsewhere in this Registration Statement. Such
financial statements have been included herein and elsewhere in this
Registration Statement in reliance upon such reports given upon the authority of
such firm as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission a
Registration Statement under the Securities Act with respect to the Common Stock
offered hereby. This Prospectus, which is a part of the Registration Statement,
does not contain all of the information set forth in the Registration Statement
and the exhibits and schedules thereto. For further information with respect to
the Company and the Common Stock, reference is hereby made to such Registration
Statement and the exhibits and schedules thereto, copies of which may be
inspected without charge at the public reference facilities maintained by the
Securities and Exchange Commission at Judiciary Plaza, Room 1024, 450 Fifth
Street N.W., Washington, D.C. 20549, and at its regional offices at 7 World
Trade Center, New York, New York 10048 and Northwestern Atrium Center, 500 West
Madison Street, Chicago, Illinois 60661-2551. Copies of such materials may also
be obtained from the Public Reference Section of the Securities and Exchange
Commission, Washington, D.C. 20549, upon payment of the fees prescribed by the
Securities and Exchange Commission. The summaries in this Prospectus of
additional information included in the Registration Statement or any exhibit
thereto are qualified in their entirety by reference to such information or
exhibit.

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INDEX TO FINANCIAL STATEMENTS

PAGE
----

DYNAMEX INC. AND SUBSIDIARIES
Independent Auditors' Report........................................................ F-3
Consolidated Balance Sheets, July 31, 1994 and 1995 and April 30, 1996.............. F-4
Consolidated Statements of Operations for each of the years in the three-year period
ended July 31, 1995 and for the nine months ended April 30, 1995 (unaudited) and
April 30, 1996................................................................... F-5
Consolidated Statements of Shareholders' Equity for the three years ended July 31,
1995 and for the nine months ended April 30, 1996................................ F-6
Consolidated Statements of Cash Flows for each of the years in the three-year period
ended July 31, 1995 and for the nine months ended April 30, 1995 (unaudited) and
April 30, 1996................................................................... F-7
Notes to the Consolidated Financial Statements...................................... F-8
DYNAMEX EXPRESS INC.
Independent Auditors' Report........................................................ F-16
Statement of Operations for the five months ended May 31, 1995...................... F-17
Statement of Changes in Financial Position for the five months ended May 31, 1995... F-18
Notes to the Financial Statements................................................... F-19
Independent Auditors' Report........................................................ F-21
Statements of Operations for each of the years in the three-year period ended
December 31, 1994................................................................ F-22
Statements of Changes in Financial Position for each of the years in the three-year
period ended December 31, 1994................................................... F-23
Notes to the Financial Statements................................................... F-24
Pro Forma Statement of Operations for the 10 months ended May 31, 1995.............. F-27
MAYNE NICKLESS COURIER
Independent Auditors' Report........................................................ F-28
Combined Statements of Operations for each of the fiscal years in the three-year
period ended July 2, 1995 and for the six months ended December 31, 1994
(unaudited) and December 28, 1995................................................ F-29
Combined Statements of Cash Flows for each of the fiscal years in the three-year
period ended July 2, 1995 and for the six months ended December 31, 1994
(unaudited) and December 28, 1995................................................ F-30
Notes to the Combined Financial Statements.......................................... F-31
ACQUIRED COMPANIES
Introduction to Pro Forma Combined Financial Statements............................. F-34
Pro Forma Combined Balance Sheet, March 31, 1996 (unaudited)........................ F-35
Pro Forma Combined Statement of Operations for the nine months ended March 31, 1996
(unaudited)...................................................................... F-36
Pro Forma Combined Statement of Operations for the year ended June 30, 1995
(unaudited)...................................................................... F-37
Pro Forma Combined Statement of Operations for the year ended December 31, 1995
(unaudited)...................................................................... F-38
Pro Forma Combined Statement of Operations for the three months ended March 31, 1996
(unaudited)...................................................................... F-39
Notes to the Pro Forma Combined Financial Statements (unaudited).................... F-40
K.H.B. & ASSOCIATES LTD. (A.K.A. ZIPPER TRANSPORTATION SERVICES LTD.)
Independent Auditors' Report........................................................ F-41
Consolidated Balance Sheets, December 31, 1994 and 1995 and March 31, 1996
(unaudited)...................................................................... F-42
Consolidated Statements of Operations and Retained Earnings for the years ended
December 31, 1994 and 1995 and for the three months ended March 31, 1995
(unaudited) and 1996 (unaudited)................................................. F-43
Consolidated Statements of Changes in Financial Position for the years ended
December 31, 1994 and 1995 and for the three months ended March 31, 1995
(unaudited) and 1996 (unaudited)................................................. F-44
Notes to the Consolidated Financial Statements...................................... F-45

F-1
57

PAGE
----

ACTION DELIVERY AND MESSENGER SERVICE LIMITED
Independent Auditors' Report........................................................ F-49
Consolidated Balance Sheets, December 31, 1994 and 1995 and March 31, 1996
(unaudited)...................................................................... F-50
Consolidated Statements of Operations and Retained Earnings for the years ended
December 31, 1994 and 1995 and for the three months ended March 31, 1995
(unaudited) and 1996 (unaudited)................................................. F-51
Consolidated Statements of Changes in Financial Position for the years ended
December 31, 1994 and 1995 and for the three months ended March 31, 1995
(unaudited) and 1996 (unaudited)................................................. F-52
Notes to the Consolidated Financial Statements...................................... F-53
SOUTHBANK COURIER, INC.
Independent Auditors' Report........................................................ F-56
Consolidated Balance Sheets, December 31, 1994 and 1995 and March 31, 1996
(unaudited)...................................................................... F-57
Consolidated Statements of Operations and Retained Earnings for the years ended
December 31, 1994 and 1995 and for the three months ended March 31, 1995
(unaudited) and 1996 (unaudited)................................................. F-58
Consolidated Statements of Cash Flows for the years ended December 31, 1994 and 1995
and for the three months ended March 31, 1995 (unaudited) and 1996 (unaudited)... F-59
Notes to the Consolidated Financial Statements...................................... F-60
SEKO ENTERPRISES, INC. AND RELATED COMPANIES
Independent Auditors' Report........................................................ F-62
Combined Balance Sheets, December 31, 1994 and 1995 and March 31, 1996
(unaudited)...................................................................... F-63
Combined Statements of Income and Retained Earnings for the years ended December 31,
1994 and 1995 and for the three months ended March 31, 1995 (unaudited) and 1996
(unaudited)...................................................................... F-64
Combined Statements of Cash Flows for the years ended December 31, 1994 and 1995 and
for the three months ended March 31, 1995 (unaudited) and 1996 (unaudited)....... F-65
Notes to the Combined Financial Statements.......................................... F-66
SEIDEL DELIVERY
Independent Auditors' Report........................................................ F-71
Combined Balance Sheets, December 31, 1994 and 1995 and March 31, 1996
(unaudited)...................................................................... F-72
Combined Statements of Income and Retained Earnings for the years ended December 31,
1994 and 1995 and for the three months ended March 31, 1995 (unaudited) and 1996
(unaudited)...................................................................... F-73
Combined Statements of Cash Flows for the years ended December 31, 1994 and 1995 and
for the three months ended March 31, 1995 (unaudited) and 1996 (unaudited)....... F-74
Notes to the Combined Financial Statements.......................................... F-75

F-2
58

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Dynamex Inc.

We have audited the accompanying consolidated balance sheets of Dynamex
Inc. (formerly Parcelway Systems Holding Corp.) and subsidiaries as of July 31,
1994 and 1995 and April 30, 1996, and the related consolidated statements of
operations, shareholders' equity and cash flows for each of the years in the
three year period ended July 31, 1995 and for the nine months ended April 30,
1996. These financial statements are the responsibility of the Company'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 an audit to obtain
reasonable assurance 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, such consolidated financial statements present fairly, in
all material respects, the financial position of Dynamex Inc. and subsidiaries
as of July 31, 1994 and 1995 and April 30, 1996, and the results of their
operations and their cash flows for each of the years in the three year period
ended July 31, 1995 and for the nine months ended April 30, 1996, in conformity
with generally accepted accounting principles.

DELOITTE & TOUCHE

Toronto, Ontario
May 30, 1996, except for Note 13,
as to which the date is June 3, 1996.

F-3
59

DYNAMEX INC. (FORMERLY PARCELWAY SYSTEMS HOLDING CORP.) AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)

JULY 31 APRIL
------------------ 30
1994 1995 1996
------ ------- -------

ASSETS
CURRENT
Cash and cash equivalents.................................... $ 865 $ 506 $ 516
Accounts receivable (net of allowance for doubtful accounts
of $76, $122 and $184 at July 31, 1994 and 1995 and April
30, 1996, respectively)................................... 2,298 7,208 10,768
Prepaid and other current assets............................. 221 390 479
------ ------- -------
3,384 8,104 11,763
PROPERTY AND EQUIPMENT -- net (Note 4)......................... 817 1,519 1,990
INTANGIBLES -- net (Note 3).................................... 3,889 7,194 17,867
DEFERRED OFFERING EXPENSES..................................... -- -- 370
OTHER ASSETS................................................... 44 377 997
------ ------- -------
$8,134 $17,194 $32,987
====== ======= =======
LIABILITIES
CURRENT
Line of credit............................................... $ 522 $ 2,686 $ --
Accounts payable trade....................................... 197 481 986
Accrued liabilities
Broker commissions........................................ 279 808 1,471
Wages..................................................... 46 177 884
Outside transportation.................................... 67 85 386
Other..................................................... 505 1,859 2,692
Dividends payable............................................ 299 -- --
Current portion of long-term debt (Note 5)................... 831 524 2,044
------ ------- -------
2,746 6,620 8,463
LONG-TERM DEBT (Note 5)........................................ 1,999 5,924 18,866
------ ------- -------
4,745 12,544 27,329
------ ------- -------
COMMITMENTS AND CONTINGENCIES (Note 6)
SHAREHOLDERS' EQUITY
Preferred stock; 10,000,000 shares authorized; none
outstanding............................................. 3 -- --
Common stock; 50,000,000 shares authorized; 2,543,460
shares outstanding (Notes 10 and 13).................... 5 25 25
Stock warrants (Note 5)................................... -- -- 624
Additional paid-in capital................................ 5,453 8,756 8,756
Accumulated deficit....................................... (2,072) (4,138) (3,749)
Unrealized foreign currency translation adjustment (Note
8)...................................................... -- 7 2
------ ------- -------
3,389 4,650 5,658
------ ------- -------
$8,134 $17,194 $32,987
====== ======= =======

See accompanying notes to the consolidated financial statements

F-4
60

DYNAMEX INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE DATA)

NINE MONTHS
YEAR ENDED ENDED
JULY 31 APRIL 30
---------------------------- ----------------------
1993 1994 1995 1995 1996
------ ------- ------- ----------- -------
(UNAUDITED)

SALES........................................ $ 728 $ 7,023 $21,032 $11,350 $50,015
COST OF SALES................................ 419 5,212 14,336 7,805 35,079
------ ------- ------- ------- -------
GROSS PROFIT................................. 309 1,811 6,696 3,545 14,936
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES.................... 752 2,449 7,068 4,227 12,391
DEPRECIATION AND AMORTIZATION................ 54 322 690 509 1,066
------ ------- ------- ------- -------
OPERATING INCOME (LOSS)...................... (497) (960) (1,062) (1,191) 1,479
INTEREST EXPENSE............................. 25 157 403 240 1,079
OTHER (INCOME) EXPENSE....................... (14) (52) 157 -- --
------ ------- ------- ------- -------
INCOME (LOSS) BEFORE TAXES................... (508) (1,065) (1,622) (1,431) 400
INCOME TAXES................................. -- -- 3 -- 11
------ ------- ------- ------- -------
NET INCOME (LOSS)............................ $ (508) $(1,065) $(1,625) $(1,431) $ 389
====== ======= ======= ======= =======
NET INCOME (LOSS) PER COMMON
SHARE...................................... $(0.33) $ (0.63) $ (0.81) $ (0.85) $ 0.10
====== ======= ======= ======= =======
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
(Note 13).................................. 1,556 1,691 2,018 1,679 3,706
====== ======= ======= ======= =======

See accompanying notes to the consolidated financial statements

F-5
61

DYNAMEX INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(IN THOUSANDS)

REDEEMABLE UNREALIZED
PREFERRED FOREIGN
COMMON STOCK STOCK ADDITIONAL CURRENCY
------------------ ------------------ PAID-IN ACCUMULATED TRANSLATION
SHARES PAR VALUE SHARES PAR VALUE WARRANTS CAPITAL DEFICIT ADJUSTMENT TOTAL
------ --------- ------ --------- -------- ---------- ----------- ---------- -------

BALANCE, AUGUST 1, 1993.... 17 $-- 2 $ 150 $ -- $ 451 $ (708) $ -- $ (107)
Stock dividend........... 296 3 -- -- -- (3) -- -- --
Purchase of redeemable
preferred
stock.................. -- -- (2) (150) -- 75 -- -- (75)
Sale of common stock..... 345 3 -- -- -- 1,114 -- -- 1,117
Sale of redeemable
preferred stock........ -- -- 309 3 -- 3,815 -- -- 3,818
Dividends on convertible
redeemable preferred
stock.................. -- -- -- -- -- -- (299) -- (299)
Escrow shares
surrendered............ (142) (1) -- -- -- 1 -- -- --
Unrealized foreign
currency............... -- -- -- -- -- -- -- -- --
Net translation
adjustment loss........ -- -- -- -- -- -- (1,065) -- (1,065)
----- --- ---- ----- ---- ------ ------- --- -------
BALANCE, JULY 31, 1994..... 516 5 309 3 -- 5,453 (2,072) -- 3,389
Sale of common stock..... 608 6 -- -- -- 2,539 -- -- 2,545
Conversion of redeemable
preferred stock to
common stock........... 1,236 12 (309) (3) -- (9) -- -- --
Dividend on redeemable
preferred
stock.................. -- -- -- -- -- -- (441) -- (441)
Dividend and interest
expense converted to
common stock........... 183 2 -- -- -- 773 -- -- 775
Unrealized foreign
currency translation
adjustment............. -- -- -- -- -- -- -- 7 7
Net loss................. -- -- -- -- -- -- (1,625) -- (1,625)
----- --- ---- ----- ---- ------ ------- --- -------
BALANCE, JULY 31, 1995..... 2,543 25 -- -- -- 8,756 (4,138) 7 4,650
Sale of stock warrants... -- -- -- -- 624 -- -- -- 624
Unrealized foreign
currency translation
adjustment............. -- -- -- -- -- -- -- (5) (5)
Net income............... -- -- -- -- -- -- 389 -- 389
----- --- ---- ----- ---- ------ ------- --- -------
BALANCE, APRIL 30, 1996.... 2,543 $25 -- $ -- $624 $8,756 $(3,749) $ 2 $ 5,658
===== === ==== ===== ==== ====== ======= === =======

See accompanying notes to the consolidated financial statements

F-6
62

DYNAMEX INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS EXCEPT SHARE DATA)

NINE MONTHS ENDED
YEAR ENDED JULY 31 APRIL 30
------------------------- ------------------
1993 1994 1995 1995 1996
----- ------- ------- ------- --------
(UNAUDITED)

OPERATING ACTIVITIES
Net income (loss)......................................... $(508) $(1,065) $(1,625) $(1,431) $ 389
Adjustment to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization........................... 54 321 678 509 1,066
Loss on disposal of property and equipment.............. 1 1 12 -- --
Loss on disposal Tuscon division........................ -- -- 18 18 --
Unrealized foreign currency adjustment.................. -- -- 7 (8) (5)
Dividend and interest expense converted to common
stock................................................. -- -- 57 -- --
Changes in assets and liabilities:
Cash restricted for acquisition of businesses or payment
of debt from acquisition of businesses................ (77) 77 (18) (18) --
Accounts receivable..................................... (115) (611) (6) 247 (474)
Prepaids and other assets............................... (21) (89) 172 136 (89)
Accounts payable and accrued expenses................... 30 386 (239) 564 951
Dividends payable....................................... -- -- -- 318 --
----- ------- ------- ------- --------
Net cash provided by (used in) operating activities....... (636) (980) (944) 335 1,838
----- ------- ------- ------- --------
INVESTING ACTIVITIES
Payments for acquisitions................................. (366) (2,185) (7,794) -- (12,267)
Purchase of property and equipment........................ (27) (66) (213) (194) (457)
Proceeds from sale of property and equipment.............. 6 -- 12 -- --
----- ------- ------- ------- --------
Net cash used in investing activities..................... (387) (2,251) (7,995) (194) (12,724)
----- ------- ------- ------- --------
FINANCING ACTIVITIES
Principal payment on long term debt....................... (12) (1,361) (1,110) (577) (3,414)
Net borrowings under line of credit....................... (55) 522 2,797 (7) (2,686)
Proceeds from issuance of long term debt.................. 700 -- 4,709 -- 17,876
Proceeds from issuance of stock warrants.................. -- -- -- -- 624
Purchase of redeemable preferred stock.................... -- (75) -- -- --
Net proceeds from sale of common stock.................... -- 4,934 2,460 -- --
Dividends paid............................................ -- (9) (21) (360) --
Other assets, deferred offering expenses and
intangibles............................................. (9) (47) (255) -- (1,504)
----- ------- ------- ------- --------
Net cash provided by (used in) financing activities....... 624 3,964 8,580 (944) 10,896
----- ------- ------- ------- --------
NET INCREASE (DECREASE) IN CASH............................. (399) 733 (359) (803) 10
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD.............. 531 132 865 865 506
----- ------- ------- ------- --------
CASH AND CASH EQUIVALENTS, END OF PERIOD.................... $ 132 $ 865 $ 506 $ 62 $ 516
===== ======= ======= ======= ========
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION
Cash paid for interest.................................... $ 2 $ 181 $ 403 $ 240 $ 403
----- ------- ------- ------- --------
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES
Capital lease obligation.................................. $ 13 $ 84 $ -- $ 69 $ 43
----- ------- ------- ------- --------
Note issued for sale of 30,912 shares of common stock..... $ -- $ 100 $ -- $ -- $ --
----- ------- ------- ------- --------
In conjunction with the acquisitions described in Note 3,
liabilities were assumed as follows:
Fair value of assets acquired......................... $ 885 $ 5,629 $10,188 $ -- $ 14,325
Cash paid............................................. (366) (2,184) (2,920) -- (12,267)
----- ------- ------- ------- --------
Liabilities assumed and incurred and issuance of notes
payable................................................. $ 519 $ 3,445 $ 7,268 $ -- $ 2,058
===== ======= ======= ======= ========

See accompanying notes to the consolidated financial statements

F-7
63

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Dynamex Inc. (formerly Parcelway Systems Holding Corp.) and Subsidiaries
(the "Company") provides same-day delivery and logistics services in the U.S.
and Canada. The Company's primary services are (i) same-day, on-demand delivery
(ii) scheduled distribution and (iii) fleet management. The Company intends to
continue to expand its business through acquiring or developing businesses in
additional areas of the U.S. and Canada and in areas of its existing operations.

Principles of consolidation -- The consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries: Parcelway
Courier Systems, Inc., Parcelway Systems (International), Inc., Parcelway
Courier Systems of Illinois, Inc., Parcelway Courier Systems III, Inc., Dynamex
Operations East, Inc., Dynamex Operations West, Inc., and Parcelway Courier
Systems Canada Ltd. All significant intercompany balances and transactions are
eliminated on consolidation.

The accounts of Parcelway Courier Systems Canada Ltd. ("Canada") have been
translated into United States dollars under the provision of Statement of
Financial Accounting Standards No. 52 with the Canadian dollar as the functional
currency. Translation adjustments arising from the translation of Canada's
financial statements into U.S. dollars are reported as a separate component of
equity.

Property and equipment is stated at cost and is depreciated using the
straight-line method over their estimated useful lives or the term of the lease,
whichever is shorter, as follows:

Equipment................................................ 5 years
Furniture................................................ 5 years
Vehicles................................................. 7-10 years
Other.................................................... 4 years

Intangibles arise from the acquisition of operations and include the excess
purchase price over net assets acquired, covenants not-to-compete and other
intangible costs. The excess purchase price over net assets acquired is being
amortized over periods from 5 to 25 years. The Company reviews the value
assigned to the excess purchase price over net assets acquired to determine if
it has been impaired by adverse conditions affecting the Company. Management is
of the opinion that there has been no diminution in the value assigned.
Covenants not-to-compete, trademarks and other intangibles are being amortized
over their estimated effective lives, generally five years. Total amortization
expense was $23,000, $252,000, $450,000, $455,000 (unaudited) and $642,000 for
the years ended July 31, 1993, 1994 and 1995 and for the nine months ended April
30, 1995 and 1996, respectively.

Other assets consist primarily of financing fees incurred. These costs are
being amortized on a straight-line basis over the term of the related financing,
approximately five years.

Revenue recognition -- Revenue and direct expenses are recognized when
services are rendered to customers.

Cash and cash equivalents -- The Company considers all highly liquid
investments with a maturity of three months or less to be cash equivalents. Cash
equivalents are carried at cost, which approximates market value.

Net income (loss) per common share -- Common share equivalents are
considered in the computation of weighted average number of shares and earnings
per share for a profitable period, by dividing net income by the average number
of common shares and common share equivalents represent dilutive effects of the
assumed exercise of outstanding stock options and warrants using the treasury
stock method. Fully diluted earnings per share has not been presented because
the difference between that and primary earnings per share is not material.

New accounting standard -- In October 1995, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" (SFAS 123). SFAS 123 establishes a
fair value based method of accounting for stock-based employee compensation
plans; however, it also allows companies to continue to measure cost for such
plans using the method of

F-8
64

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

accounting prescribed by Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" (APB 25). Companies that elect to continue with
the accounting under APB 25 must provide certain pro forma disclosures of net
income, as if SFAS 123 had been applied. The accounting and disclosure
requirements of SFAS 123 are effective for the Company for transactions entered
into in fiscal 1997. The Company is currently evaluating its alternatives under
SFAS 123, and its impact on operating results, when initially adopted by the
Company, is not presently known.

Stock split -- On June 3, 1996, the Company declared a 4 for 1 stock split
(Note 13). The effect of such stock split has been retroactively reflected in
the accompanying financial statements.

Reclassifications -- Certain reclassifications of prior year amounts have
been made to conform to the current period financial statement reporting format.

2. ACQUISITIONS

On January 15, 1993, the Company acquired certain assets of Big Apple
Courier Service ("Big Apple"), an on-demand courier service operating in Tucson,
Arizona, for $50,000 and the assumption of $30,000 of liabilities. Effective
April 15, 1993, the Company purchased certain assets and assumed certain
obligations of RAD Delivery Messenger Service ("RAD"), an on-demand courier
service operating in Phoenix, Arizona, for $16,250 and the assumption of $38,750
in liabilities. On July 1, 1993, the Company acquired certain assets of DLC
Consulting Group ("DLC"), an on-demand courier service operating in Phoenix,
Arizona, for $300,000 and a $450,000 note.

During 1994, the Company acquired certain assets of four on-demand courier
companies, located in Phoenix, Chicago, Los Angeles and in Canada for
$2,184,422, notes of $2,588,780, a $300,000 draw on the line of credit and the
assumption of $555,990 in liabilities.

On May 31, 1995, the Company acquired certain assets of Dynamex Express
Inc., the ground courier operations of Air Canada, for cash of $2,920,400 (plus
expenses of $164,336), a $4,709,145 note and the assumption of $2,558,047 in
liabilities.

On December 29, 1995, the Company acquired certain assets of Mayne Nickless
Courier Systems, Inc., Mayne Nickless Messenger Services, Inc. and Mayne
Nickless Canada Inc. (collectively "Mayne Nickless"), a same-day intracity on
demand ground courier service operating in various cities in the U.S. and
Canada, for cash of $11,868,000 (plus expenses of $399,000) and the assumption
of $2,058,418 in liabilities.

Each of these acquisitions has been accounted for using the purchase method
of accounting and the results of operations of these companies have been
included in these financial statements from the date of acquisition. The
following unaudited pro forma combined results of operations for the year ended
July 31, 1995 and for the nine months ended April 30, 1996 are presented as if
the acquisitions occurred as of August 1, 1994.

YEAR ENDED NINE MONTHS
JULY 31, ENDED APRIL
1995 30, 1996
---------- -----------
PRO FORMA PRO FORMA
---------- -----------
(IN THOUSANDS EXCEPT PER
SHARE DATA)

Sales........................................................ $ 77,787 $61,956
Net income................................................... 54 358
======= =======
Per share:
Net income................................................. $ 0.03 $ 0.10
======= =======

F-9
65

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The Company has recorded the assets acquired as shown below (in thousands):

JULY 31
------------------ APRIL 30
1994 1995 1996
------ ------- -----------

Accounts receivable.................................. $1,553 $ 4,883 $ 3,086
Property and equipment............................... 652 737 440
Other assets......................................... 103 976 --
Intangibles.......................................... 3,321 3,756 10,799
------ ------- -------
Assets acquired...................................... $5,629 $10,352 $14,325
====== ======= =======

Consideration for these transactions consisted of the following (in
thousands):

JULY 31
------------------ APRIL 30
1994 1995 1996
------ ------- -----------

Cash................................................. $2,184 $ 3,085 $12,267
Long-term debt....................................... 2,889 4,709 --
Liabilities assumed.................................. 556 2,558 2,058
------ ------- -------
$5,629 $10,352 $14,325
====== ======= =======

3. INTANGIBLES

Intangibles from the Company's various acquisitions consist of the
following (in thousands):

JULY 31
------------------ APRIL 30
1994 1995 1996
------ ------- -----------

Excess of purchase price over net assets acquired.... $2,775 $ 6,530 $17,285
Covenants not to compete............................. 1,206 1,206 1,173
Other................................................ 183 183 602
------ ------ -------
4,164 7,919 19,060
Less accumulated amortization........................ (275) (725) (1,193)
------ ------ -------
Intangibles -- net................................... $3,889 $ 7,194 $17,867
====== ====== =======

4. PROPERTY AND EQUIPMENT

Property and equipment consists of the following (in thousands):

JULY 31
------------------ APRIL 30
1994 1995 1996
------ ------- -----------

Equipment............................................ $ 604 $ 506 $ 1,819
Furniture............................................ 231 540 177
Vehicles............................................. 59 254 244
Other................................................ 2 517 474
---- ------ ------
896 1,817 2,714
Less accumulated depreciation........................ (79) (298) (724)
---- ------ ------
Property and equipment -- net........................ $ 817 $ 1,519 $ 1,990
==== ====== ======

F-10
66

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

5. LONG-TERM DEBT

JULY 31
----------------- APRIL 30
1994 1995 1996
------ ------ --------
(IN THOUSANDS)

Bank credit agreement(a)................................ $ -- $ -- $ 14,321
Junior subordinated debentures(b)....................... -- -- 3,904
Note payable(c)......................................... -- 4,709 2,369
Seller financing notes and other(d)..................... 2,765 1,660 273
Capital lease obligations (Note 6)...................... 65 79 43
------ ------ -------
2,830 6,448 20,910
Less current portion.................................... 831 524 2,044
------ ------ -------
$1,999 $5,924 $ 18,866
====== ====== =======

(a) Bank Credit Agreement

In connection with the acquisition of Mayne Nickless (see Note 2) the
Company entered into a credit agreement with a bank. Proceeds of the facility
were used to fund the acquisition of Mayne Nickless, refinance certain existing
debt, and for working capital. The facility consists of a revolving note of up
to $2,500,000, a $6,000,000 term facility with the Company's Canadian
subsidiary, and a $8,000,000 term facility with the Company and its U.S.
subsidiaries. The amount available under the revolving note is subject to a
borrowing base formula. At April 30, 1996 $2,500,000 was available under the
revolving note of which $800,000 was outstanding. Any amounts outstanding under
the revolving facility are due May 30, 1997 with interest payable quarterly at
prime, or certain other rate options, plus a premium based on certain financial
ratios of the Company. At April 30, 1996 such rate was prime plus 1% or 9.25%.

The U.S. and Canadian term facilities are repayable in quarterly
installments of $400,000 and $75,000, respectively, with any outstanding
balances due at December 31, 2000 and March 31, 2001, respectively. Interest is
payable quarterly based on prime, or certain other rate options, plus a premium
based on certain financial ratios of the Company. At April 30, 1996 such rate
was prime plus 1.25% or 9.50%. By June 28, 1996, or sooner under certain
circumstances, the Company is required to enter into interest rate hedging
arrangements so as to effectively fix the rate of interest on a portion of the
outstanding loans. In addition, the Company is required to prepay the term
facilities with any "Excess Cash Flow", as defined, as well as with certain
proceeds of asset sales, insurance recoveries and the sale of capital stock.

Amounts outstanding under the credit agreement are secured by essentially
all of the assets of the Company and its subsidiaries and by the common stock of
the Company owned by a major shareholder. The agreement also contains
restrictions on the payment of dividends, incurring additional debt, capital
expenditures and investments by the Company as well as requiring the Company to
maintain certain financial ratios.

(b) Junior Subordinated Debentures

In connection with the acquisition of Mayne Nickless the Company issued
$4,500,000 face value of Junior Subordinated Debentures "Debentures" to certain
stockholders of the Company. The Debentures are subordinated to all other debt
for borrowed money and have been recorded at their estimated fair value as of
the date of issue of $3,876,000. Interest is payable semi-annually and accrues
at 12% through December 28, 1996 and at 18% thereafter. The Company may elect to
pay interest in additional Debentures through December 31, 1998. The principal
amount of the Debentures is due June 28, 2001. The Debentures are redeemable at
any time at 100% of face value plus accrued and unpaid interest and must be
redeemed with the proceeds of an initial public offering of the Company's common
stock, subject to their subordination provisions. The purchasers of the
Debentures were also issued warrants to purchase an aggregate of 1,080,000

F-11
67

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

shares of the Company's common stock at a price of $0.025 per share; however,
the number of shares which may be purchased will be reduced to 540,000 if the
Debentures are redeemed by June 30, 1996 or by December 31, 1996 if the Company
is actively pursuing a public offering of its common stock on June 30, 1996.

In connection with the acquisition of Dynamex Express, the Company issued
to the seller a note payable in the principal amount of Cdn $6,450,000
($4,709,000). Upon the acquisition of Mayne Nickless this note was partially
repaid and replaced with a new note in the principal amount of Cdn $3,225,000
($2,369,000). The new note is subordinated to the Company's bank credit
agreement above. The note bears interest at 10% which is payable quarterly. The
principal amount of the note is due March 28, 2002. The note contains covenants
identical to those of the bank credit agreement, subject to amendment under
certain conditions.

(d) Seller Financing Notes and Other

In connection with various acquisitions (see Note 2) the Company issued
various notes to the sellers of those businesses. These notes bore interest at
varying rates based primarily on prime. In connection with the acquisition of
Mayne Nickless these notes were repaid.

Principal payments due in each of the next five years for long-term debt
are as follows (in thousands):

1997................................................ $2,044
1998................................................ 2,831
1999................................................ 1,940
2000................................................ 1,901
2001................................................ 5,921

6. COMMITMENTS AND CONTINGENCIES

The Company leases certain equipment under capital leases. The leases
expire at various dates through fiscal year 2000. Capital leases included in
property and equipment total $45,000 (net of accumulated amortization of
$50,000) as of April 30, 1996.

Future minimum lease payments for such leases are as follows (in
thousands):

CAPITAL LEASES
--------------

1997............................................ $ 24
1998............................................ 11
1999............................................ 7
2000............................................ 1
---
43
Less amount representing interest............... 3
---
Net present value of future minimum
lease payments................................ $ 40
====

Rent expense for the years ended July 31, 1993, 1994 and 1995 and the nine
months ended April 30, 1995 and 1996 was $31,000, $168,000, $458,000 and
$342,000 (unaudited), and $842,000 respectively.

F-12
68

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

7. INCOME TAXES

As of August 1, 1992, the Company adopted Statement of Financial Accounting
Standards No. 109 ("SFAS No. 109"), Accounting for Income Taxes, which requires
an asset and liability approach for financial accounting and reporting for
income taxes. SFAS No. 109 allows the income tax consequences resulting from
utilization of net operating loss carryforwards to be recorded. For purposes of
reporting the Company's deferred tax items under the provisions of SFAS No. 109,
the deferred tax asset of approximately $865,000 as of July 31, 1995
(1994 -- $485,000), arising principally from the available net operating loss
carryforward, has not been reported as an asset due to a valuation allowance.

The Company has U.S. federal net operating loss carryforwards of
approximately $2,152,000 as of July 31, 1995. These net operating loss
carryforwards expire as follows: $132,000 (2007), $636,000 (2008), $665,000
(2009) and $719,000 (2010). The Company also has state net operating loss
carryforwards in certain states. The utilization of the Company's net operating
loss carryforwards is subject to annual limitations under Internal Revenue Code
sec. 382, due to a previous change in ownership of the Company and a change in
its year-end in prior years.

The Company also has Canadian non-capital losses carried forward as of July
31, 1995 of approximately $690,000 expiring in 2002, the benefit of which has
not been reflected in these financial statements.

8. FOREIGN OPERATIONS

Amounts included in the consolidated financial statements applicable to
Canada were as follows (in thousands):

JULY 31 APRIL
---------------------------- 30
1993 1994 1995 1996
----- ------ ------- -------

Revenues...................................... $ -- $2,436 $15,094 $38,087
Operating income (loss)....................... -- 24 (78) 1,831
Identifiable assets........................... -- 3,528 13,324 16,044

9. RELATED PARTY TRANSACTIONS

As of April 30, 1996, the Company had a note receivable totalling $28,317
from a stockholder related to the purchase of 5,000 shares of the Company's
common stock.

During the year ended July 31, 1995, the Company paid approximately
$146,000 to a related party for consulting services in connection with
acquisition of Dynamex Express Inc. and other advisory services.

During the period ended April 30, 1996 the Company paid a related party
$70,000 for investment banking services rendered in connection with the
Company's acquisition of Mayne Nickless and $165,000 for the arrangement of bank
financing related to that acquisition.

10. SHARE CAPITAL

During 1994, the Company amended its articles of incorporation to authorize
an additional 990,000 shares of the Company's common stock and to authorize
309,024 shares of a new class of 12% redeemable convertible preferred stock,
$0.01 par value. The Company then effected a common stock split in the form of a
dividend where it distributed 17.2542 shares of common stock for each share of
common stock outstanding. The effect of this dividend was to increase the number
of shares of common stock outstanding from 17,168 to 313,388.

On November 16, 1993, the Company executed a Securities Purchase Agreement
with an unrelated party. Under the terms of the Securities Purchase Agreement,
the Company sold to the unrelated party

F-13
69

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

309,024 shares of the Company's common stock for $1,000,000 and 1,236,096 shares
of the Company's 12% redeemable convertible preferred stock for $4,000,000. In
connection with this agreement, the Company sold 5,000 shares of the Company's
common stock for $16,175 to another third party and sold 30,912 shares of common
stock to the previous sole stockholder for $100,000 for which a promissory note
was issued. The Company used a portion of these proceeds to retire the
outstanding debt and the accrued interest associated therewith, as well as the
Class A redeemable preferred shares and all related unpaid dividends. In
connection with the sale of the redeemable preferred stock, a stockholder agreed
to place 141,708 shares in escrow, which shares would be surrendered to the
Company without consideration over a 42 month period if certain transactions do
not occur. These shares of the Company's common stock held in escrow by a
stockholder were surrendered to the Company without consideration in July 1994.

In May 1995, in order to provide financing related to the Dynamex Express
Inc. acquisition (Note 2), the Company sold 294,116 shares each of the Company's
common stock to two parties: a) the holders of 309,024 shares of the Company's
common stock and 309,024 shares of the Company's redeemable convertible
preferred stock, and b) an unrelated party. Both parties made a cash payment of
$1,250,000 each. In connection with this financing the holders of 309,024 shares
of the Company's 12% redeemable convertible preferred stock converted these
shares to 1,236,096 shares of the Company's common stock in a dollar for dollar
conversion. The company also sold 20,000 shares of the Company's common stock
for $85,000 to the stockholder.

On December 20, 1995, the Company restated its articles of incorporation to
change its name from Parcelway Systems Holding Corp. to Dynamex Inc. The
articles of incorporation were also restated to increase the authorized capital
stock to 10,000,000 shares of $0.01 par value common stock and to 3,000,000
shares of $0.01 par value preferred stock.

11. STOCK OPTION PLAN

Effective November 16, 1993, the Company's stockholders approved the 1993
Stock Option Plan (the "Plan"). The Plan provides for the granting of incentive
and non-qualified stock options to employees of the Company. Eligibility is
determined by the Board of Directors who administers the Plan. The Company
reserved 131,076 shares of its common stock to be granted under the Plan.

Options granted under the Plan expire up to 10 years after the date of
grant, and become exercisable in accordance with the vesting period as
determined by the Board of Directors on the date of the grant. The exercise
price of such shares, as determined by the Board of Directors on the date of
grant, may be equal to or in excess of the fair market value of the Company's
common stock on the date of grant.

During the year ended July 31, 1994, the Plan provided for options to be
issued for the right to purchase 87,384 shares of the Company's common stock to
an employee exercisable at $3.24 per share.

During the year ended July 31, 1995, an additional 118,520 shares of the
Company's common stock were reserved to be granted under the Plan and options
for the purchase of 139,000 shares of the Company's common stock at $4.25 per
share.

12. SELLING, GENERAL AND ADMINISTRATIVE

Included in selling, general and administrative expenses are bad debt
expenses as follows (in thousands):

For the year ended July 31, 1993.............................................. $ 1
For the year ended July 31, 1994.............................................. 61
For the year ended July 31, 1995.............................................. 155
For the nine months ended April 30, 1995 (unaudited).......................... 122
For the nine months ended April 30, 1996...................................... 300

F-14
70

DYNAMEX INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

13. SUBSEQUENT EVENT

On June 3, 1996, the Company restated its articles of incorporation to
increase the authorized capital stock to 50,000,000 shares of $0.01 par value
common stock and to 10,000,000 shares of $0.01 par value preferred stock. The
Company then effected a common stock split in the form of a dividend where it
distributed three shares of common stock for every share of common stock
outstanding. The effect of the dividend was to increase the number of shares of
common stock outstanding from 635,865 to 2,543,460.

The Company has entered into agreements, and with respect to Action
Delivery a letter of intent, pursuant to which it will purchase, on or before a
contemplated initial public offering, the same-day delivery businesses of (i)
Action Delivery and Messenger Service Limited (Halifax, Nova Scotia), (ii)
Seidel Enterprises, Inc. and a related company (Columbus, Ohio), (iii) Seko
Enterprises, Inc. and related companies (Chicago, Illinois), (iv) Southbank
Courier, Inc. (New York, New York), and (v) K.H.B. & Associates Ltd. (Winnipeg,
Manitoba). As consideration for the stock of the Acquired Companies, the
stockholders of the Acquired Companies will receive an aggregate of
approximately $7.2 million cash and approximately 126,170 shares of Common Stock
(assuming an initial public offering price of $11.00 per share) and the Company
will repay an aggregate amount of approximately $840,000 of the Acquired
Companies' indebtedness.

F-15
71

INDEPENDENT AUDITORS' REPORT

To the Shareholder of
Dynamex Express Inc.

We have audited the statements of operations and of changes in financial
position of Dynamex Express Inc. for the five months ended May 31, 1995. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with auditing standards generally
accepted in Canada. Those standards require that we plan and perform an audit to
obtain reasonable assurance 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.

In our opinion, these financial statements present fairly, in all material
respects, the results of operations and the changes in financial position of the
Company for the five months ended May 31, 1995 in accordance with accounting
principles generally accepted in Canada.

DELOITTE & TOUCHE

Toronto, Ontario
September 15, 1995

F-16
72

DYNAMEX EXPRESS INC.

STATEMENT OF OPERATIONS
(IN THOUSANDS OF CANADIAN DOLLARS)

FIVE MONTHS
ENDED
MAY 31, 1995
------------

SALES........................................................................... $19,956
COST OF SALES................................................................... 14,300
-------
GROSS PROFIT.................................................................... 5,656
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.................................... 4,659
DEPRECIATION AND AMORTIZATION................................................... 212
-------
OPERATING INCOME................................................................ 785
INTEREST INCOME................................................................. 44
OTHER INCOME.................................................................... 105
-------
INCOME BEFORE INCOME TAXES...................................................... 934
INCOME TAXES.................................................................... 9
-------
NET INCOME FOR THE PERIOD....................................................... $ 925
=======

See accompanying notes to the financial statements

F-17
73

DYNAMEX EXPRESS INC.

STATEMENT OF CHANGES IN FINANCIAL POSITION
(IN THOUSANDS OF CANADIAN DOLLARS)

FIVE MONTHS
ENDED
MAY 31, 1995
------------

NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES
OPERATING
Net income for the period..................................................... $ 925
Items not affecting cash
Depreciation............................................................... 136
Amortization of goodwill................................................... 76
Loss on disposal of property and equipment................................. 1
Changes in non-cash working capital components............................. (477)
------
661
------
INVESTING
Purchase of property and equipment............................................ (238)
Mortgage principal repayments................................................. 2
------
(236)
------
FINANCING
Repayment of long-term debt................................................... (858)
------
NET CASH OUTFLOW DURING THE PERIOD.............................................. (433)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD.................................. 1,321
------
CASH AND CASH EQUIVALENTS, END OF PERIOD........................................ $ 888
======

See accompanying notes to the financial statements

F-18
74

DYNAMEX EXPRESS INC.

NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 1995
(IN THOUSANDS OF CANADIAN DOLLARS)

1. INCORPORATION

Dynamex Express Inc., a wholly-owned subsidiary of Air Canada, was
incorporated under the laws of Canada. The Company's principal business activity
is the supply of local same day courier and messenger service throughout various
centres in Canada.

2. SIGNIFICANT ACCOUNTING POLICIES

The financial statements have been prepared in accordance with accounting
principles generally accepted in Canada and include the following significant
accounting policies:

Property and equipment

Property and equipment are stated at cost less accumulated depreciation.
Depreciation is provided at rates to write off the cost of fixed assets on a
straight-line basis over their estimated useful lives as follows:

New vehicle trailers............. 10 years
Old vehicle trailers............. 7 years
Furniture and office equipment... 5 years
Other equipment.................. 5 years
Leasehold improvements........... Term of lease plus 1 renewal
Software......................... 4 years

Goodwill

Goodwill consists of the excess purchase price paid on acquisition of
certain assets of a company over the value assigned to the identified assets and
the excess of amounts paid over the assigned value of tangible assets upon
acquisition of shares in a company.

These assets are being amortized on a straight-line basis over a period of
29 years and 32 years, respectively. It is management's belief that these
unamortized costs will be recoverable from future profitable operations of the
Company.

Foreign currency translation

Monetary assets and liabilities in foreign currencies are translated at
year-end exchange rates. Gains or losses are included in income for the period,
except gains or losses relating to long-term assets and liabilities which are
deferred and amortized over the remaining life of the items. Other assets and
liabilities and items affecting income are converted at rates of exchange in
effect at the date of the transaction.

3. LEASE COMMITMENTS

The Company has lease commitments, mainly for premises, under operating
leases. During the period, rental expense under these leases included in the
statement of operations amounted to $373. As a result of the acquisition of
certain of the Company's assets by Parcelway Courier Systems Canada Ltd. at May
31, 1995, there are no future lease commitments.

F-19
75

DYNAMEX EXPRESS INC.

NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

4. RELATED PARTY TRANSACTIONS

In addition to amounts disclosed elsewhere in these financial statements,
the Company incurred approximately $130 of interest and expenses for contracted
advice from its parent and affiliates. Sales to the parent amounted to
approximately $594.

5. INCOME TAXES

At December 31, 1994, the Company's preceding taxation year end, there were
approximately $719 of loss carryforwards available to reduce future years'
income, the potential benefit of which has not been recorded in the financial
statements. These loss carryforwards expire in 1998. In addition, there are
approximately $152 of deferred tax debits which have not been recognized as of
December 31, 1994.

6. UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

The financial statements have been prepared in accordance with generally
accepted accounting principles (GAAP) in Canada and, except as noted below,
conform in all material respects with those of the United States. The
significant difference between Canadian GAAP and United States GAAP is as
follows:

Income Taxes

- - Under Canadian GAAP, tax losses carried forward are only recognized in the
year incurred, if it is virtually certain that the benefit will be realized.

- - Under United States GAAP (Statement of Financial Accounting Standards No. 109
(SFAS 109) which became effective for the year ended December 31, 1993), tax
losses should be recognized as a deferred tax asset, unless based on the
weight of available evidence, it is more likely than not that some portion, or
all of the deferred tax asset will not be realized. A deferred tax asset
should be recognized effective January 1, 1993 on the adoption of SFAS 109.

Reconciliation of Canadian GAAP net income to United States GAAP net income.

Net income as reported under Canadian GAAP.................................... $925
Increase in income tax expense................................................ 407
----
Net income as reported under United States GAAP............................... $518
====

F-20
76

INDEPENDENT AUDITORS' REPORT

To the Shareholder of
Dynamex Express Inc.

We have audited the statements of operations and changes in financial
position of Dynamex Express Inc. for each of the three years in the period ended
December 31, 1994. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, these financial statements present fairly, in all material
respects, the results of operations and the changes in financial position of
Dynamex Express Inc. for each of the three years in the period ended December
31, 1994 in accordance with accounting principles generally accepted in Canada.

PRICE WATERHOUSE

Mississauga, Ontario
February 24, 1995

F-21
77

DYNAMEX EXPRESS INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS OF CANADIAN DOLLARS)

YEAR ENDED DECEMBER 31
-------------------------------
1992 1993 1994
------- ------- -------

SALES......................................................... $47,068 $43,850 $45,570
COST OF SALES................................................. 34,984 31,665 32,855
------- ------- -------
GROSS PROFIT.................................................. 12,084 12,185 12,715
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.................. 12,369 10,741 10,924
DEPRECIATION AND AMORTIZATION................................. 488 501 507
------- ------- -------
OPERATING INCOME (LOSS)....................................... (773) 943 1,284
INTEREST (INCOME) EXPENSE..................................... 141 110 (14)
OTHER INCOME.................................................. (195) (26) (144)
------- ------- -------
INCOME (LOSS) BEFORE INCOME TAXES............................. (719) 859 1,442
PROVISION FOR (RECOVERY OF) INCOME TAXES...................... (203) 19 (27)
------- ------- -------
NET INCOME (LOSS) FOR THE YEAR................................ $ (516) $ 840 $ 1,469
======= ======= =======

See accompanying notes to the financial statements

F-22
78

DYNAMEX EXPRESS INC.

STATEMENTS OF CHANGES IN FINANCIAL POSITION
(IN THOUSANDS OF CANADIAN DOLLARS)

YEAR ENDED DECEMBER 31
---------------------------
1992 1993 1994
----- ------ ------

CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES
Net income (loss) for the year.................................. $(516) $ 840 $1,469
Items not affecting cash
Depreciation................................................. 306 319 325
Amortization of goodwill..................................... 182 182 182
(Gain) loss on disposal of property and equipment............ 46 10 (28)
Write-down of assets held for sale........................... 14 -- --
Changes in non-cash working capital components.................. (11) (154) 280
----- ------ ------
21 1,197 2,228
----- ------ ------
INVESTING ACTIVITIES
Purchase of property and equipment.............................. (187) (503) (397)
Proceeds from disposal of property and equipment................ 97 150 71
Mortgage principal repayments................................... -- -- 10
----- ------ ------
(90) (353) (316)
----- ------ ------
FINANCING ACTIVITY
Repayment of long-term debt..................................... -- (599) (842)
----- ------ ------
NET CASH INCREASE (DECREASE) DURING THE YEAR...................... (69) 245 1,070
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR...................... 75 6 251
----- ------ ------
CASH AND CASH EQUIVALENTS, END OF YEAR............................ $ 6 $ 251 $1,321
===== ====== ======

See accompanying notes to the financial statements

F-23
79

DYNAMEX EXPRESS INC.

NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 1992, 1993 AND 1994
(IN THOUSANDS OF CANADIAN DOLLARS)

1. INCORPORATION

2. SIGNIFICANT ACCOUNTING POLICIES

The financial statements have been prepared in accordance with accounting
principles generally accepted in Canada and include the following significant
accounting policies:

Property and equipment

Property and equipment are stated at cost less accumulated depreciation.
Depreciation is provided at rates to write-off the cost of fixed assets on a
straight-line basis over their estimated useful lives as follows:

New vehicle trailers........ 10 years
Old vehicle trailers........ 5 years
Furniture and office
equipment................. 5 years
Other equipment............. 5 years
Leasehold improvements...... Term of lease plus 1 renewal
Software.................... 4 years

Goodwill

Foreign currency translation

Monetary assets and liabilities in foreign currencies are translated at
year-end exchange rates. Gains or losses are included in income for the year,
except gains or losses relating to long-term assets and liabilities which are
deferred and amortized over the remaining life of the items. Other assets and
liabilities and items affecting income are converted at rates of exchange in
effect at the date of the transaction.

F-24
80

DYNAMEX EXPRESS INC.

NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

3. LEASE COMMITMENTS

The Company has lease commitments, mainly for premises, under operating
leases. Rental expense under these leases included in the statements of
operations amounted to $1,007, $1,041 and $1,131 for the years ending December
31, 1992, 1993 and 1994, respectively. Minimum annual rentals under operating
leases are as follows as at December 31, 1994:

1995.................................................. $611
1996.................................................. 337
1997.................................................. 173
1998.................................................. 150
1999.................................................. 156
2000 and thereafter................................... 771

4. RELATED PARTY TRANSACTIONS

Transactions with the parent and affiliates include the following:

YEAR ENDED
DECEMBER 31
----------------------------
1992 1993 1994
------ ------ ------

Interest on long-term debt............................... $ 190 $ 147 $ 77
Expenses for contracted services......................... 559 379 330
Sales.................................................... 3,642 3,593 4,333

5. INCOME TAXES

The Company has applied previously unrecorded tax loss carryforwards
amounting to $1,681 in 1994 and $860 in 1993 to reduce income for tax purposes.
At December 31, 1994, the Company has $719 of loss carryforwards available to
reduce future years' income, the potential benefit of which has not been
recorded in the financial statements. These loss carryforwards expire in 1998.
In addition, there are approximately $152 of deferred tax debits which have not
been recognized as at December 31, 1994.

6. UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

Under Canadian GAAP, the tax benefit of all or a portion of tax losses is
recognized in the period in which the tax loss occurs, if the corporation is
virtually certain of realizing the tax benefit. Where a tax benefit resulting
from a loss carry-forward was not recorded in the period in which the loss
occurred, it is recognized in the period of realization. Under United States
GAAP (Statement of Financial Accounting Standards No. 109 (SFAS 109)), the
benefit of tax losses is recognized as a deferred tax asset and reduced by a
valuation allowance if, based on the weight of available evidence, it is more
likely than not that some portion or all of the deferred tax asset will not be
realized. SFAS 109 became effective for the year ended December 31, 1993 and a
deferred tax asset has been recognized for United States GAAP purposes as at
January 1, 1993 for tax losses carried-forward by the Company. A valuation
allowance was not provided as it was considered more likely than not that the
deferred tax asset would be realized. The effect of this accounting change has
been reflected as a cumulative accounting change in 1993.

F-25
81

DYNAMEX EXPRESS INC.

NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

Reconciliation of Canadian GAAP net income to United States GAAP net income.

YEAR ENDED
DECEMBER 31
----------------
1993 1994
------ ------

Net income (loss) as reported under Canadian GAAP................... $ 840 $1,469
Increase in income tax expense...................................... (458) (642)
Cumulative effect of accounting change -- increase in income........ 1,561 --
------ ------
Net income (loss) as reported under United States GAAP.............. $1,943 $ 827
====== ======

F-26
82

DYNAMEX EXPRESS INC.

PRO FORMA STATEMENT OF OPERATIONS
TEN MONTHS ENDED MAY 31, 1995
(UNAUDITED)

(IN THOUSANDS OF CANADIAN DOLLARS)
------------------------------------------------------- (IN THOUSANDS)
LESS --------------
FIVE MONTHS ADD SEVEN MONTHS TEN MONTHS TEN MONTHS
ENDED YEAR ENDED ENDED ENDED ENDED
MAY 31, DECEMBER 31, JULY 31, MAY 31, EXCHANGE MAY 31,
1995 1994 1994 1995 RATE 1995
----------- ------------ ------------ ---------- -------- --------------

SALES.................... $19,956 $45,570 $26,029 $39,497 0.73 $28,833
COST OF SALES............ 14,300 32,855 18,506 28,649 0.73 20,914
------- ------- ------- ------- -------
GROSS PROFIT............. 5,656 12,715 7,523 10,848 7,919
SELLING, GENERAL AND
ADMINISTRATIVE
EXPENSES............... 4,659 10,924 6,526 9,057 0.73 6,612
DEPRECIATION AND
AMORTIZATION........... 212 507 295 424 0.73 310
------- ------- ------- ------- -------
OPERATING INCOME......... 785 1,284 702 1,367 997
INTEREST INCOME -- net... (44) (14) -- (58) 0.73 (42)
OTHER INCOME............. 105 144 9 240 0.73 175
------- ------- ------- ------- -------
INCOME BEFORE TAXES...... 934 1,442 711 1,665 1,214
INCOME TAXES............. 9 (27) (32) 14 0.73 10
------- ------- ------- ------- -------
NET INCOME FOR THE
PERIOD................. $ 925 $ 1,469 $ 743 $ 1,651 $ 1,204
======= ======= ======= ======= =======

F-27
83

INDEPENDENT AUDITORS' REPORT

Mayne Nickless Courier:

We have audited the accompanying combined statements of operations and cash
flows of Mayne Nickless Courier (a wholly owned business of Mayne Nickless
Transport, North America until December 28, 1995) for the six months ended
December 28, 1995 and each of the three fiscal years in the period ended July 2,
1995. These financial statements are the responsibility of Mayne Nickless
Courier'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, such combined financial statements present fairly, in all
material respects, the results of operations and cash flows of Mayne Nickless
Courier for the six months ended December 28, 1995 and each of the three fiscal
years in the period ended July 2, 1995, in conformity with generally accepted
accounting principles.

The accompanying combined financial statements have been prepared from the
separate records maintained by Mayne Nickless Courier and may not be indicative
of the conditions that would have existed or the results of operations if Mayne
Nickless Courier had been operated as an unaffiliated company. As discussed in
Note 2, Statement of Financial Accounting Standards No. 109 requires that the
consolidated amount of current and deferred tax expenses for a group that files
a consolidated tax return be allocated among members of the group when those
members issue separate financial statements. On the basis that Mayne Nickless
Courier is a business and not a separate subsidiary, current and deferred income
taxes have not been provided for in the accompanying combined financial
statements.

DELOITTE & TOUCHE LLP

San Francisco, California
April 19, 1996

F-28
84

MAYNE NICKLESS COURIER

COMBINED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

FISCAL YEAR ENDED SIX MONTHS ENDED
----------------------------- --------------------------
JULY 4 JULY 3 JULY 2 DECEMBER 31 DECEMBER 28
1993 1994 1995 1994 1995
------- ------- ------- ----------- -----------
(UNAUDITED)

SALES................................... $28,858 $28,149 $27,922 $13,904 $14,008
COST OF SALES........................... 17,152 16,808 16,433 8,179 7,985
------- ------- ------- ------- -------
GROSS PROFIT............................ 11,706 11,341 11,489 5,725 6,023
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSE............................... 9,546 9,272 8,946 4,873 4,924
DEPRECIATION AND
AMORTIZATION.......................... 1,410 875 666 331 312
------- ------- ------- ------- -------
OPERATING INCOME........................ 750 1,194 1,877 521 787
INTEREST EXPENSE -- Parent.............. 390 111 74 30 36
------- ------- ------- ------- -------
NET INCOME.............................. $ 360 $ 1,083 $ 1,803 $ 491 $ 751
======= ======= ======= ======= =======

See accompanying notes to the combined financial statements

F-29
85

MAYNE NICKLESS COURIER

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

OPERATING ACTIVITIES
Net income............................ $ 360 $ 1,083 $ 1,803 $ 491 $ 751
Adjustments to reconcile net income to
net cash provided by operating
activities
Depreciation and amortization...... 1,410 875 666 331 312
(Gain) loss on disposal of fixed
assets........................... 6 -- (127) -- --
Changes in assets and liabilities
Accounts receivable................ 156 (491) 35 (22) (279)
Prepaid expenses................... (60) 120 63 40 3
Accounts payable and accrued
liabilities...................... 365 664 (56) 412 346
Other.............................. (60) 351 149 (47) (6)
------- ------- ------- ------- -------
Net cash provided by operating
activities............................ 2,177 2,602 2,533 1,205 1,127
------- ------- ------- ------- -------
INVESTING ACTIVITIES
Proceeds from sale of property and
equipment.......................... 151 -- 90 -- --
Purchase of property and equipment.... (461) (334) (263) (130) (77)
------- ------- ------- ------- -------
Net cash used in investing activities... (310) (334) (173) (130) (77)
------- ------- ------- ------- -------
FINANCING ACTIVITIES
Distributions to Parent............... (1,946) (3,065) (1,783) (835) (1,144)
------- ------- ------- ------- -------
INCREASE (DECREASE) IN CASH
EQUIVALENTS........................... (79) (797) 577 240 (94)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD................................ 887 808 11 11 588
------- ------- ------- ------- -------
CASH AND CASH EQUIVALENTS, END OF
PERIOD................................ $ 808 $ 11 $ 588 $ 251 $ 494
======= ======= ======= ======= =======

See accompanying notes to the combined financial statements

F-30
86

MAYNE NICKLESS COURIER

NOTES TO THE COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS)

1. ORGANIZATION AND BASIS OF PRESENTATION

Mayne Nickless Courier provides on-demand delivery, transportation, fleet
management and distribution services. Mayne Nickless Courier is a deliverer of
intracity small parcel same-day shipments for medium to large customers
principally in Southern California, the San Francisco Bay Area, Seattle,
Pittsburgh, Washington D.C., Boston and Vancouver and Victoria, British
Columbia.

Effective December 29, 1995, pursuant to an Asset Purchase Agreement,
Dynamex, Inc. acquired certain assets and assumed certain liabilities of the
same-day courier business of Mayne Nickless Courier Systems Inc., Mayne Nickless
Messenger Service, Inc. and the Canadian same day courier business of Mayne
Nickless North America Inc. (collectively, "Mayne Nickless Courier") from Mayne
Nickless Transport, North America ("Parent") for approximately $12,200 in cash,
including transaction costs and assumption of approximately $2,100 in
liabilities.

The accompanying combined financial statements present operations and cash
flows of Mayne Nickless Courier on an historical basis. The accompanying
combined financial statements have been prepared from the separate records
maintained by Mayne Nickless Courier and may not be indicative of the conditions
that would have existed or the results of operations if Mayne Nickless Courier
had been operated as an unaffiliated company. All significant intercompany
balances and transactions have been eliminated.

2. SIGNIFICANT ACCOUNTING POLICIES

Fiscal Year

The Company's fiscal year ends on the Sunday nearest June 30. The last
three fiscal years consist of the 52-week periods ended July 2, 1995, July 3,
1994, and July 4, 1993. The audited combined financial statements for the six
months ended December 28, 1995 (the date of acquisition by Dynamex) are included
herein. The combined statements of operations and cash flows for the six months
ended December 31, 1994 are unaudited, but in the opinion of the Company's
management, contain all adjustments (consisting only of normal recurring items)
necessary for a fair presentation of results of operations and cash flows.

Use of Estimates

The preparation of Mayne Nickless Courier's combined financial statements
in conformity with generally accepted accounting principles necessarily requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the balance sheet dates and the reported amounts of revenues and expenses for
the periods presented. Actual results may differ from such estimates.

Cash and Cash Equivalents

For purposes of the combined statements of cash flows, Mayne Nickless
Courier considers all highly liquid investments with a maturity of three months
or less to be cash equivalents.

Depreciation

Depreciation is calculated using the straight-line method over the
estimated useful life of the asset, typically ranging from three to five years
for furniture, fixtures and equipment. The cost of leasehold improvements is
amortized over the useful life of the asset or the applicable lease term
whichever is shorter.

F-31
87

MAYNE NICKLESS COURIER

NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

Intangibles

Intangibles arise from the acquisition of operations and include the excess
of the purchase price over net assets acquired, and covenants not-to-compete.
Such excess is being amortized over fifteen years. Covenants not-to-compete are
being amortized over the life of those agreements, generally, two or five years.
Amortization expense for the six months ended December 28, 1995, for the six
months ended December 31, 1994 and the fiscal years ended July 2, 1995, July 3,
1994 and July 4, 1993 was $202, $225 (unaudited), $447, $627, and $1,020,
respectively.

Insurance

Mayne Nickless Courier participates in the Parent's consolidated insurance
program. The Parent is primarily self-insured for workers' compensation,
automobile and general liability costs. The estimated self-insurance liability
is determined based on claims filed and an estimate of claims incurred but not
yet reported. The Parent charges Mayne Nickless Courier for those expenses which
it believes is a reasonable estimate of what Mayne Nickless Courier would incur
if they did not participate in the Parent's consolidated insurance program.
Insurance expense for the six months ended December 28, 1995, for the six months
ended December 31, 1994 and the fiscal years ended July 2, 1995, July 3, 1994
and July 4, 1993 was $476, $463 (unaudited), $925, $1,227, and $1,241,
respectively.

Revenue Recognition

Revenue is recognized when the services are rendered to customers.

Income Taxes

The Company has been included in the Parent's consolidated Canadian, United
States Federal and state income tax returns. The Parent, on a consolidated
basis, has been in a net loss position for income tax purposes for the six
months ended December 31, 1994, and for the fiscal years ended July 2, 1995,
July 3, 1994 and July 4, 1993. Statement of Financial Accounting Standards No.
109 requires that the consolidated amount of current and deferred tax expenses
for a group that files a consolidated tax return be allocated among members of
the group when those members issue separate financial statements. On the basis
that Mayne Nickless Courier is a business and not a separate subsidiary, current
and deferred income taxes have not been provided in the accompanying combined
financial statements.

Translation of Foreign Currencies

Assets and liabilities of the Company's Canadian operations are translated
into U.S. dollars at year-end rates of exchange, and income and expenses are
translated at average rates during the year. Adjustments resulting from
translating financial statements into U.S. dollars were not material in any of
the periods presented.

F-32
88

MAYNE NICKLESS COURIER

NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

3. NET CAPITAL INVESTED BY PARENT

The following is a reconciliation of the net capital invested by the
Parent:

FISCAL YEARS ENDED SIX MONTHS ENDED
----------------------------- --------------------------
JULY 4 JULY 3 JULY 2 DECEMBER 31 DECEMBER 28
1993 1994 1995 1994 1995
------- ------- ------- ----------- -----------
(UNAUDITED)

Net invested capital, beginning of
period................................ $ 7,200 $ 5,614 $ 3,632 $ 3,632 $ 3,652
Net income for the period............... 360 1,083 1,803 491 751
Distributions to the Parent............. (1,946) (3,065) (1,783) (835) (1,144)
------- ------- ------- ------- -------
Net invested capital, end of year....... $ 5,614 $ 3,632 $ 3,652 $ 3,288 $ 3,259
======= ======= ======= ======= =======

4. RELATED-PARTY TRANSACTIONS

The Company uses certain resources and administrative staff of the Parent,
including certain finance, legal and office services which are charged to Mayne
Nickless Courier. In connection with these services, the amounts Parent charged
Mayne Nickless Courier for the six months ended December 28, 1995, for the six
months ended December 31, 1994 and the fiscal years ended July 2, 1995, July 3,
1994 and July 4, 1993 was $183, $171 (unaudited), $342, $598, and $841,
respectively. Such amounts are included in selling, general and administrative
expense.

In addition, Mayne Nickless Courier is charged interest by the Parent based
upon the amount of advances made by the Parent. Such amounts are included in the
accompanying combined statements of operations as Interest expense -- Parent.

5. LEASES

The Company leases certain equipment and office space under operating lease
agreements which expire at various dates through June 1998.

At December 28, 1995, future minimum lease payments for such leases are as
follows:

1996................................................ $156
1997................................................ 160
1998................................................ 25
----
$341
====

Rent expense for the for the six months ended December 31, 1995, for the
six months ended December 31, 1994 and the fiscal years ended July 2, 1995, July
3, 1994 and July 4, 1993 was $163, $199 (unaudited), $466, $401, and $393,
respectively.

In the fiscal year ended July 2, 1995, the Company recorded a gain of $127
relating to the sale of the rights to certain radio frequencies, which was
included as a reduction in selling, general and administrative expense.

6. CONTINGENT LIABILITIES

Mayne Nickless Courier is subject to various lawsuits and claims arising
out of its businesses. The Asset Purchase Agreement specifies that the Parent
will retain responsibility for any such liabilities arising from events prior to
December 29, 1995. In the opinion of management of Mayne Nickless Courier, the
ultimate resolution of these matters will not have a material adverse effect on
Mayne Nickless Courier's combined financial statements taken as a whole.

F-33
89

ACQUIRED COMPANIES

INTRODUCTION TO PRO FORMA COMBINED FINANCIAL STATEMENTS

The accompanying unaudited pro forma combined financial statements present
the combined financial position of the Acquired Companies as of March 31, 1996
and the combined results of operations of the Acquired Companies for the nine
months ended March 31, 1996 and for the twelve months ended June 30, 1995. The
combined financial statements have been adjusted, on a pro forma basis, to
remove the effect of certain assets and liabilities which will not be included
in the assets and liabilities of the Acquired Companies upon their acquisition
by the Company. In addition, the combined results of operations have been
adjusted on a pro forma basis to reflect the effect of changes to certain
components of costs and expenses. These items include adjustments to
compensation to owners and managers of the Acquired Companies to reflect agreed
upon compensation levels subsequent to the acquisition by the Company,
adjustments to rental expense to reflect agreed upon modifications to lease
agreements to be effective subsequent to the acquisition by the Company and
adjustments to certain other costs and expenses which are not ongoing costs of
the businesses acquired and would not have been incurred had the Acquisitions by
the Company occurred at the beginning of the period presented.

F-34
90

ACQUIRED COMPANIES

PRO FORMA COMBINED BALANCE SHEET
MARCH 31, 1996
(UNAUDITED)

(IN THOUSANDS OF CANADIAN
DOLLARS)
-------------------------------
ACTION (IN THOUSANDS)
DELIVERY -------------------------------
AND SEKO
K.H.B. & MESSENGER EX- ENTERPRISES
ASSOCIATES SERVICE COM- CHANGE COM- SEIDEL AND RELATED
LTD. LIMITED BINED RATE BINED DELIVERY COMPANIES
---------- --------- ------ ------ ------ -------- -----------

ASSETS
CURRENT
Cash and cash equivalents..................... $ -- $ -- $ -- 0.74 $ -- $ 64 $ --
Accounts receivable -- net.................... 1,398 536 1,934 0.74 1,431 175 922
Other current assets.......................... 164 37 201 0.74 148 40 341
------ ------ ------ ------ ---- ------
1,562 573 2,135 1,579 279 1,263
PROPERTY AND EQUIPMENT -- net................... 543 731 1,274 0.74 943 46 1,790
INTANGIBLES -- net.............................. -- -- -- 0.74 -- -- 307
OTHER ASSETS -- net............................. 363 -- 363 0.74 269 -- 18
------ ------ ------ ------ ---- ------
$2,468 $ 1,304 $3,772 $2,791 $325 $ 3,378
====== ====== ====== ====== ==== ======
LIABILITIES
CURRENT LIABILITIES............................. $1,494 $ 515 $2,009 0.74 $1,487 $ 71 $ 1,234
LONG-TERM DEBT AND OTHER........................ 191 500 691 0.74 511 -- 1,170
------ ------ ------ ------ ---- ------
1,685 1,015 2,700 1,998 71 2,404
SHAREHOLDERS' EQUITY............................ 783 289 1,072 0.74 793 254 974
------ ------ ------ ------ ---- ------
$2,468 $ 1,304 $3,772 $2,791 $325 $ 3,378
====== ====== ====== ====== ==== ======

(IN THOUSANDS)
------------------------------------
SOUTHBANK
COURIER, ADJUST- COM-
INC. MENTS NOTES BINED
--------- ------- ----- ------

ASSETS
CURRENT
Cash and cash equivalents..................... $ 61 $ (38) 3(b) $ 87
Accounts receivable -- net.................... 338 (237) 3(a) 2,629
Other current assets.......................... 25 (137) 3(a) 417
---- ------- ------
424 (412) 3,133
PROPERTY AND EQUIPMENT -- net................... 23 (1,339) 3(a) 1,463
INTANGIBLES -- net.............................. -- -- 307
OTHER ASSETS -- net............................. -- (152) 3(a) 135
---- ------- ------
$ 447 $(1,903) $5,038
==== ======= ======
LIABILITIES
CURRENT LIABILITIES............................. $ 26 $ (872) 3(a) $1,946
LONG-TERM DEBT AND OTHER........................ -- (1,486) 3(a) 195
---- ------- ------
26 (2,358) 2,141
SHAREHOLDERS' EQUITY............................ 421 455 3(a) 2,897
---- ------- ------
$ 447 $(1,903) $5,038
==== ======= ======

See accompanying notes to the pro forma combined financial statements

F-35
91

ACQUIRED COMPANIES

PRO FORMA COMBINED STATEMENT OF OPERATIONS
NINE MONTHS ENDED MARCH 31, 1996
(UNAUDITED)
(IN THOUSANDS)

TWELVE ADD LESS
MONTHS THREE MONTHS SIX MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
DECEMBER 31, MARCH 31, JUNE 30, MARCH 31,
1995 1996 1995 ADJUSTMENTS NOTE 1996
------------ ------------ ---------- ----------- ---- -----------

SALES............................ $20,836 $5,260 $10,809 $ -- $15,287
COST OF SALES.................... 13,199 3,363 7,008 -- 9,554
------- ------ ------- ----- -------
GROSS PROFIT..................... 7,637 1,897 3,801 -- 5,733
SELLING, GENERAL AND
ADMINISTRATIVE
EXPENSES....................... 7,042 1,602 3,389 (752) 4(b) 4,503
DEPRECIATION AND AMORTIZATION.... 368 87 185 (46) 4(a) 224
------- ------ ------- ----- -------
OPERATING INCOME................. 227 208 227 798 1,006
INTEREST EXPENSE................. 262 76 131 (131) 4(a) 76
OTHER INCOME..................... 160 47 84 -- 123
------- ------ ------- ----- -------
INCOME BEFORE TAXES.............. 125 179 180 929 1,053
INCOME TAXES..................... 45 29 29 -- 45
------- ------ ------- ----- -------
NET INCOME....................... $ 80 $ 150 $ 151 $ 929 $ 1,008
======= ====== ======= ===== =======

See accompanying notes to the pro forma combined financial statements

F-36
92

ACQUIRED COMPANIES

PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995
(UNAUDITED)

YEAR ENDED DECEMBER 31, 1994
----------------------------------------------------------------------------------
(IN THOUSANDS OF CANADIAN
DOLLARS) (IN THOUSANDS)
-------------------------------- ----------------------------------------
ACTION
DELIVERY SEKO
AND ENTERPRISES
K.H.B. & MESSENGER EX- AND SOUTHBANK
ASSOCIATES SERVICE COM- CHANGE COM- SEIDEL RELATED COURIER,
LTD. LIMITED BINED RATE BINED DELIVERY COMPANIES INC.
---------- --------- ------- ------ ------ -------- ----------- ---------

SALES........................................ $8,502 $ 3,100 $11,602 0.73 $8,469 $1,929 $ 9,053 $ 1,597
COST OF SALES................................ 6,394 2,728 9,122 0.73 6,659 1,184 4,838 739
------ ------ ------- ------ ------ ------ ------
GROSS PROFIT................................. 2,108 372 2,480 1,810 745 4,215 858
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES.................................... 1,761 244 2,005 0.73 1,464 701 3,825 759
DEPRECIATION AND AMORTIZATION................ 121 55 176 0.73 128 20 196 8
------ ------ ------- ------ ------ ------ ------
OPERATING INCOME............................. 226 73 299 218 24 194 91
INTEREST EXPENSE............................. 55 109 164 0.73 120 -- 129 13
OTHER INCOME................................. 37 20 57 0.73 42 3 113 --
------ ------ ------- ------ ------ ------ ------
INCOME BEFORE TAXES.......................... 208 (16) 192 140 27 178 78
INCOME TAXES................................. 67 (3) 64 0.73 47 2 3 14
------ ------ ------- ------ ------ ------ ------
NET INCOME................................... $ 141 $ (13) $ 128 $ 93 $ 25 $ 175 $ 64
====== ====== ======= ====== ====== ====== ======

YEAR ENDED DECEMBER 31, 1994
--------------------------------------------------------
(IN THOUSANDS)
--------------------------------------------------------
ADD
SIX LESS
MONTHS SIX MONTHS YEAR
ENDED ENDED ENDED
COM- JUNE 30, JUNE 30, ADJUST- JUNE 30,
BINED 1995 1994 MENTS NOTE 1995
------- -------- ---------- ------- ----- --------

SALES........................................ $21,048 $ 10,809 $ 10,138 $ -- $ 21,719
COST OF SALES................................ 13,420 7,008 6,609 -- 13,819
------- ------- ------- ------- -------
GROSS PROFIT................................. 7,628 3,801 3,529 -- 7,900
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES.................................... 6,749 3,389 3,161 (1,071) 4(b) 5,906
DEPRECIATION AND AMORTIZATION................ 352 185 199 (61) 4(a) 277
------- ------- ------- ------- -------
OPERATING INCOME............................. 527 227 169 1,132 1,717
INTEREST EXPENSE............................. 262 131 114 (159) 4(a) 120
OTHER INCOME................................. 158 84 80 -- 162
------- ------- ------- ------- -------
INCOME BEFORE TAXES.......................... 423 180 135 1,291 1,759
INCOME TAXES................................. 66 29 17 -- 78
------- ------- ------- ------- -------
NET INCOME................................... $ 357 $ 151 $ 118 $ 1,291 $ 1,681
======= ======= ======= ======= =======

See accompanying notes to the pro forma combined financial statements

F-37
93

ACQUIRED COMPANIES

SCHEDULE TO PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
(UNAUDITED)

(IN THOUSANDS OF CANADIAN DOLLARS)
----------------------------------- (IN THOUSANDS)
ACTION -------------------
DELIVERY
K.H.B. & AND
ASSOCIATES MESSENGER EXCHANGE SEIDEL
LTD. SERVICE COMBINED RATE COMBINED DELIVERY
---------- --------- -------- -------- -------- --------

SALES................................................... $8,615 $3,118 $11,733 0.73 $8,565 $1,776
COST OF SALES........................................... 6,504 2,681 9,185 0.73 6,705 1,116
------ ------ ------- ------ ------
GROSS PROFIT............................................ 2,111 437 2,548 1,860 660
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES............................................... 1,819 272 2,091 0.73 1,526 628
DEPRECIATION AND AMORTIZATION........................... 146 63 209 0.73 153 19
------ ------ ------- ------ ------
OPERATING INCOME........................................ 146 102 248 181 13
INTEREST EXPENSE........................................ 80 102 182 0.73 133 --
OTHER INCOME............................................ 37 9 46 0.73 34 21
------ ------ ------- ------ ------
INCOME BEFORE TAXES..................................... 103 9 112 82 34
INCOME TAXES............................................ 20 2 22 0.73 16 7
------ ------ ------- ------ ------
NET INCOME.............................................. $ 83 $ 7 $ 90 $ 66 $ 27
====== ====== ======= ====== ======

(IN THOUSANDS)
---------------------------------------
SEKO
ENTERPRISES
AND RELATED SOUTHBANK
COMPANIES COURIER, INC. COMBINED
------------ ------------- --------

SALES................................................... $8,489 $2,006 $20,836
COST OF SALES........................................... 4,421 957 13,199
------ ------ -------
GROSS PROFIT............................................ 4,068 1,049 7,637
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES............................................... 3,886 1,002 7,042
DEPRECIATION AND AMORTIZATION........................... 174 22 368
------ ------ -------
OPERATING INCOME........................................ 8 25 227
INTEREST EXPENSE........................................ 129 -- 262
OTHER INCOME............................................ 105 -- 160
------ ------ -------
INCOME BEFORE TAXES..................................... (16) 25 125
INCOME TAXES............................................ 11 11 45
------ ------ -------
NET INCOME.............................................. $ (27) $ 14 $ 80
====== ====== =======

See accompanying notes to the pro forma combined financial statements

F-38
94

ACQUIRED COMPANIES

SCHEDULE TO PRO FORMA COMBINED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1996
(UNAUDITED)

(IN THOUSANDS OF CANADIAN DOLLARS) (IN THOUSANDS)
------------------------------------ ------------------------------------------------------------
ACTION SEKO
K.H.B. & DELIVERY AND ENTERPRISES
ASSOCIATES MESSENGER EXCHANGE SEIDEL AND RELATED SOUTHBANK
LTD. SERVICE COMBINED RATE COMBINED DELIVERY COMPANIES COURIER, INC. COMBINED
---------- ------------ -------- -------- -------- -------- ----------- ------------- --------

SALES............. $2,202 $818 $3,020 0.73 $2,205 $417 $2,062 $576 $5,260
COST OF SALES..... 1,661 709 2,370 0.73 1,730 263 1,111 259 3,363
------ ---- ------ ------ ---- ------ ---- ------
GROSS PROFIT...... 541 109 650 475 154 951 317 1,897
SELLING, GENERAL
AND
ADMINISTRATIVE
EXPENSES........ 391 35 426 0.73 311 137 941 213 1,602
DEPRECIATION AND
AMORTIZATION.... 40 19 59 0.73 43 5 38 1 87
------ ---- ------ ------ ---- ------ ---- ------
OPERATING INCOME
(LOSS).......... 110 55 165 121 12 (28) 103 208
INTEREST
EXPENSE......... 20 32 52 0.73 38 -- 38 -- 76
OTHER INCOME...... 8 2 10 0.73 7 7 33 -- 47
------ ---- ------ ------ ---- ------ ---- ------
INCOME (LOSS)
BEFORE TAXES.... 98 25 123 90 19 (33) 103 179
INCOME TAXES...... 29 -- 29 0.73 21 2 -- 6 29
------ ---- ------ ------ ---- ------ ---- ------
NET INCOME........ $ 69 $ 25 $ 94 $ 69 $ 17 $ (33) $ 97 $ 150
====== ==== ====== ====== ==== ====== ==== ======

See accompanying notes to the pro forma combined financial statements

F-39
95

ACQUIRED COMPANIES

NOTES TO THE PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)

1. BASIS OF PRESENTATION

The accompanying pro forma combined financial statement present the
combined financial position of the Acquired Companies as of March 31, 1996 and
the combined results of operations of the Acquired companies for the nine months
ended March 31, 1996 and for the twelve months ended June 30, 1995. The combined
financial statements have been adjusted, on a pro forma basis, to remove the
effect of certain assets and liabilities which will not be included in the
assets and liabilities of the Acquired Companies upon their acquisition by the
Company. In addition, the combined results of operations have been adjusted on a
pro forma basis to reflect the effect of changes to certain components of costs
and expenses. These items include adjustments to compensation to owners and
managers of the Acquired Companies to reflect agreed upon compensation levels
subsequent to the acquisition by the Company, adjustments to rental expense to
reflect agreed upon modifications to lease agreements to be effective subsequent
to the acquisition by the Company and adjustments to certain other costs and
expenses which are not ongoing costs of the businesses acquired and would not
have been incurred had the Acquisition by the Company occurred at the beginning
of the period presented.

2. CURRENCY CONVERSION

The financial statements of those Acquired Companies, for whom the Canadian
dollar is the functional currency, have been translated into U.S. dollars at the
conversion rate then in effect in the case of the balance sheets and at the
average conversion rate for the period in the case of the statements of
operations.

3. PRO FORMA ADJUSTMENTS TO COMBINED BALANCE SHEET

(a) Eliminates certain assets and related debt which will not be assets and
liabilities of the Acquired Companies upon the acquisition by the
Company.

(b) Adjusts working capital to reflect pro forma adjustment to aggregate
purchase price arising from working capital and funded debt provisions
of purchase agreements.

4. PRO FORMA ADJUSTMENT TO COMBINED STATEMENT OF OPERATIONS

(a) Eliminates interest expense and depreciation related to assets and
liabilities eliminated from combined balance sheet.

(b) Adjusts costs and expenses for items which are not ongoing costs of the
business and which would not have been incurred had the Acquired
Companies been owned by the Company as of the beginning of the period
presented:

NINE MONTHS ENDED TWELVE MONTHS ENDED
MARCH 31, 1996 JUNE 30, 1995
----------------- -------------------
(IN THOUSANDS)

Compensation expense...................... $ 670 $ 931
Facilities rent........................... (27) (41)
Other..................................... 109 181
------ -------
$ 752 $ 1,071
============== ===============

The above costs represent the difference between historical compensation
expense paid to the owners of the Acquired Companies and the compensation to be
paid under contractual arrangements which become effective upon the Closing,
adjustments to facilities rent pursuant to revised lease agreements which become
effective upon the Closing and the elimination of other benefits and perquisites
historically received by the owners of the Acquired Companies and which by
contractual arrangement will not be available subsequent to the Closing.

F-40
96

INDEPENDENT AUDITORS' REPORT

To the Shareholder of
K.H.B. & Associates Ltd.

We have audited the consolidated balance sheets of K. H. B. & Associates
Ltd. as at December 31, 1994 and 1995 and the consolidated statements of
operations and retained earnings and changes in financial position for the years
then ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in Canada. Those standards require that we plan and perform an audit to
obtain reasonable assurance 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.

In our opinion, these consolidated financial statements present fairly, in
all material respects, the financial position of the Company as at December 31,
1994 and 1995 and the results of its operations and the changes in its financial
position for the years then ended in accordance with accounting principles
generally accepted in Canada.

DELOITTE & TOUCHE

Winnipeg, Manitoba
March 8, 1996

F-41
97

K.H.B. & ASSOCIATES LTD.

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF CANADIAN DOLLARS)

DECEMBER 31
----------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

ASSETS
CURRENT
Accounts receivable (Note 2)................................ $1,313 $1,343 $ 1,398
Prepaid and other current assets (Note 3)................... 127 147 156
Current portion of employee housing loan.................... 8 8 8
------ ------ -------
1,448 1,498 1,562
PROPERTY AND EQUIPMENT -- net (Note 4)........................ 550 570 543
OTHER ASSETS -- net (Note 5).................................. 441 361 363
------ ------ -------
$2,439 $2,429 $ 2,468
====== ====== =======
LIABILITIES
CURRENT
Bank indebtedness........................................... $ 727 $ 934 $ 772
Commissions payable......................................... 124 114 278
Accounts payable............................................ 402 284 214
Accrued liabilities......................................... 105 90 136
Income taxes payable........................................ 59 16 31
Current portion of long-term debt (Note 6).................. 63 68 63
------ ------ -------
1,480 1,506 1,494
LONG-TERM DEBT (Note 6)....................................... 59 85 67
------ ------ -------
1,539 1,591 1,561
------ ------ -------
NON-CONTROLLING INTEREST (Note 7)............................. 124 124 124
------ ------ -------
COMMITMENTS AND CONTINGENT LIABILITY (Note 8)
SHAREHOLDER'S EQUITY
Share capital
Authorized
Unlimited number of
1% to 12% non-cumulative, voting Class A preference
shares redeemable at $1 per share
1% to 6% non-cumulative, non-voting Class B
preference shares redeemable at $1.00 per share
Common shares
Issued
815,750 Class B preference shares...................... -- -- --
484,250 Class A preference shares...................... -- -- --
1,000,000 common shares.................................. -- -- --
Retained earnings........................................... 776 714 783
------ ------ -------
776 714 783
------ ------ -------
$2,439 $2,429 $ 2,468
====== ====== =======

See accompanying notes to the consolidated financial statements

F-42
98

K.H.B. & ASSOCIATES LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(IN THOUSANDS OF CANADIAN DOLLARS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
---------------- ----------------
1994 1995 1995 1996
------ ------ ------ ------
(UNAUDITED)

REVENUE.................................................... $8,502 $8,615 $2,182 $2,202
COST OF SALES.............................................. 6,394 6,504 1,648 1,661
------ ------ ------ ------
GROSS PROFIT............................................... 2,108 2,111 534 541
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES................................................. 1,761 1,819 366 391
DEPRECIATION AND AMORTIZATION.............................. 121 146 36 40
------ ------ ------ ------
OPERATING INCOME........................................... 226 146 132 110
INTEREST EXPENSE........................................... 55 80 23 20
OTHER INCOME............................................... (37) (37) (12) (8)
------ ------ ------ ------
INCOME BEFORE INCOME TAXES................................. 208 103 121 98
INCOME TAXES............................................... 67 20 41 29
------ ------ ------ ------
NET INCOME................................................. 141 83 80 69
RETAINED EARNINGS, BEGINNING OF PERIOD..................... 635 776 776 714
------ ------ ------ ------
776 859 856 783
DIVIDENDS PAID............................................. -- 145 -- --
------ ------ ------ ------
RETAINED EARNINGS, END OF PERIOD........................... $ 776 $ 714 $ 856 $ 783
====== ====== ====== ======

See accompanying notes to the consolidated financial statements

F-43
99

K.H.B. & ASSOCIATES LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
(IN THOUSANDS OF CANADIAN DOLLARS)

YEAR ENDED THREE MONTHS
DECEMBER 31 ENDED MARCH 31
-------------- --------------
1994 1995 1995 1996
----- ----- ----- -----
(UNAUDITED)

NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING
ACTIVITIES
OPERATING
Net income for the period.................................. $ 141 $ 83 $ 80 $ 69
Items not affecting cash
Depreciation and amortization........................... 121 146 36 40
Deferred income taxes................................... 2 1 -- --
Loss on disposal of fixed assets........................ 30 3 -- --
----- ----- ----- -----
294 233 116 109
Changes in non-cash working capital balances
Accounts receivable..................................... (337) (30) 140 (54)
Prepaid expenses and supplies........................... 46 (20) 15 (9)
Accounts payable and accrued liabilities................ 238 (143) (229) 140
Income taxes payable.................................... 23 (43) 26 15
Dividends paid.......................................... -- (145) -- --
----- ----- ----- -----
264 (148) 68 201
----- ----- ----- -----
FINANCING
Net (decrease) increase in long-term debt.................. (56) 32 (17) (23)
----- ----- ----- -----
INVESTING
Property and equipment..................................... (103) (164) (36) (10)
Proceeds on disposal of property and equipment............. -- 6 -- --
Other assets............................................... (251) 67 (5) (6)
----- ----- ----- -----
(354) (91) (41) (16)
----- ----- ----- -----
NET CASH INFLOW (OUTFLOW).................................... (146) (207) 10 162
BANK INDEBTEDNESS, BEGINNING OF PERIOD....................... (581) (727) (727) (934)
----- ----- ----- -----
BANK INDEBTEDNESS, END OF PERIOD............................. $(727) $(934) $(717) $(772)
===== ===== ===== =====

See accompanying notes to the consolidated financial statements

F-44
100

K.H.B. & ASSOCIATES LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS OF CANADIAN DOLLARS)

1. ACCOUNTING POLICIES

The consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in Canada and conform in all material
respects with those of the United States. The Company's significant accounting
policies are as follows:

Basis of presentation

These consolidated financial statements include the accounts of the Company
and its subsidiary Zipper Transportation Services Ltd./Services de Transport
Zipper Ltee.

Inventory

Supplies and uniforms on hand are recorded at the lower cost and net
realizable value.

Property and equipment

Fixed assets are recorded at cost and depreciation is provided at the
following rates:

Vehicles........................................ 30% diminishing-balance basis
Furniture, fixtures and equipment............... 20% diminishing-balance basis
Radio equipment................................. 10% straight-line basis
Computer and telephone equipment................ 20% straight-line basis
Leasehold improvements.......................... Over the term of the lease;
minimum 5 years

Capital leases

Lease agreements which transfer the risks and rewards of ownership of the
leased assets are accounted for as capital leases, whereby the fair market value
of the leased asset is capitalized and amortized over its useful life to the
company. A corresponding obligation under capital lease is recorded and reduced
by the lease payments, based on the interest rate implicit in the lease.

Goodwill

Goodwill consists of the excess of cost over the fair value of net assets
acquired and is amortized on a straight-line basis over twenty years. Annually,
the Company evaluates the net carrying value of goodwill to determine if there
has been any impairment in value. This determination is made by reviewing
projections of future cash flow to be generated by the acquired business.

Deferred income taxes

Deferred income taxes arise primarily as a result of the excess of
depreciation recorded for book purposes in excess of capital cost allowance
claimed for tax purposes.

F-45
101

K.H.B. & ASSOCIATES LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

2. ACCOUNTS RECEIVABLE

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Trade................................................... $1,069 $ 986 $ 971
Drivers and sundry...................................... 21 33 20
Staff advances.......................................... 2 3 1
Due from Alcrest Holdings Ltd. ......................... 55 66 66
Due from shareholder.................................... 166 255 340
------ ------ ------
$1,313 $1,343 $1,398
====== ====== ======

The amounts due from Alcrest Holdings Ltd., a related party, and from
shareholder are non-interest bearing with no fixed terms of repayment.

3. PREPAID EXPENSES AND SUPPLIES

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Supplies................................................ $ 107 $ 107 $ 101
Uniforms................................................ 11 13 13
Other................................................... 9 27 42
------ ------ ------
$ 127 $ 147 $ 156
====== ====== ======

4. PROPERTY AND EQUIPMENT

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Vehicles................................................ $ 114 $ 96 $ 96
Radio equipment......................................... 277 277 277
Furniture, fixtures and equipment....................... 326 367 364
Computer equipment...................................... 220 249 249
Leasehold improvements.................................. 142 199 212
Radio equipment under capital lease..................... 227 227 227
------ ------ ------
1,306 1,415 1,425
Less: Accumulated depreciation.......................... 756 845 882
------ ------ ------
$ 550 $ 570 $ 543
====== ====== ======

F-46
102

K.H.B. & ASSOCIATES LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

5. OTHER ASSETS

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Employee housing loan................................... $ 251 $ 192 $ 192
Security deposits....................................... 32 23 28
Deferred income taxes................................... 17 16 16
Goodwill (net of amortization of $82 in 1994; $93 in
1995; $96 in 1996).................................... 149 138 135
------ ------ ------
449 369 371
Less: Current portion of employee housing loan.......... 8 8 8
------ ------ ------
$ 441 $ 361 $ 363
====== ====== ======

The employee housing loan is non-interest bearing and is secured by a
second mortgage on the employees residence. The loan is repayable in annual
installments of $8.

6. LONG-TERM DEBT

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Bank loan, repayable in monthly principal installments
of $1 plus interest at the bank's prime rate plus
1.25%................................................. $ 35 $ -- $ --
Bank loan, repayable in monthly principal installments
of $3 plus interest at the bank's prime rate plus
1.50%................................................. -- 90 82
Bank loan, repayable in blended, monthly installments of
$1, bearing interest at 9.90%......................... -- 29 26
Obligation under capital lease.......................... 87 34 22
------ ------ ------
122 153 130
Current portion......................................... 63 68 63
------ ------ ------
$ 59 $ 85 $ 67
====== ====== ======

a) The bank loans and bank indebtedness are secured by the following:

- registered general assignment of book debts and covering all assets;

- assignment of insurance proceeds on all assets;

- keyman life insurance in the amount of $400;

- unlimited guarantee of the shareholder and an associated company;

- assignment of the second mortgage on the home of the shareholder.

(b) Expected principal repayments over the next 5 years are as follows:

1996................................................... $63
1997................................................... 40
1998................................................... 41
1999................................................... 4

F-47
103

K.H.B. & ASSOCIATES LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

(c) Interest expense on long-term debt during the year ended December 31,
1994 and 1995 and during the three months ended March 31, 1995 and 1996
amounted to $18, $14, $4 (unaudited) and $4 (unaudited), respectively.

(d) The obligation under capital lease is comprised of the following:

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Minimum lease payments in:
1995............................................. $61 $-- $--
1996............................................. 36 36 23
--- --- ---
97 36 23
Less amounts representing interest................. (10) (2) (1)
--- --- ---
$87 $34 $22
=== === ===

7. NON-CONTROLLING INTEREST

The non-controlling interest is comprised of 119,000 Class C preference
shares issued by the Company's subsidiary. These shares which carry
non-cumulative dividend entitlements of 1% to 12%, may be redeemed for $124 at
the option of the subsidiary or the holder. The holder is related to the
shareholder of the Company.

8. COMMITMENTS AND CONTINGENT LIABILITY

(a) The Company has entered into various lease agreements for premises,
vehicles and equipment with expiry dates to 1998. Minimum annual rents,
net of anticipated recovery of rental charges for leased vehicles and
premises, for each of the next three years is as follows:

1996................................................... $62
1997................................................... 21
1998................................................... 12

(b) The Company has provided guarantees and postponements of claim of the
debts of an affiliated corporation, Alcrest Holdings Ltd. As at March
31, 1996, these debts amounted to $766 (unaudited).

9. RELATED PARTY TRANSACTIONS

The financial statements include rent paid to Alcrest Holdings Ltd., a
company affiliated by common control, in the amount of $204, $204, $51
(unaudited) and $51 (unaudited) for the year ended December 31, 1994 and 1994
and the three months ended March 31, 1995 and 1996, respectively.

F-48
104

INDEPENDENT AUDITORS' REPORT

To the Shareholders of
Action Delivery and Messenger Service Limited

We have audited the consolidated balance sheets of Action Delivery and
Messenger Service Limited as at December 31, 1994 and 1995 and the consolidated
statements of operations and retained earnings and changes in financial position
for the years then ended. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, these consolidated financial statements present fairly, in
all material respects, the financial position of the Company as at December 31,
1994 and 1995, and the results of its operations and the changes in its
financial position for the years then ended, in accordance with accounting
principles generally accepted in Canada.

DELOITTE & TOUCHE

Halifax, Nova Scotia
March 29, 1996

F-49
105

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF CANADIAN DOLLARS)

DECEMBER 31
---------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

ASSETS
CURRENT
Accounts receivable (net of allowance for doubtful accounts of
$12, $15 and nil (unaudited) at December 31, 1994 and 1995
and March 31, 1996, respectively).......................... $ 437 $ 425 $ 427
Due from parent company....................................... 31 94 109
Income taxes recoverable...................................... 3 -- --
Inventories................................................... 18 15 15
Prepaid expenses.............................................. 12 8 12
Current portion of term loans receivable (Note 4)............. 20 14 10
------ ------ -------
521 556 573
PROPERTY AND EQUIPMENT -- net (Note 3).......................... 784 725 731
TERM LOANS RECEIVABLE (Note 4).................................. 15 -- --
------ ------ -------
$1,320 $1,281 $ 1,304
====== ====== =======
LIABILITIES
CURRENT
Bank indebtedness (Note 5).................................... $ 330 $ 313 $ 323
Accounts payable.............................................. 62 73 46
Accrued liabilities........................................... 19 -- 12
Accrued driver wages.......................................... 64 75 88
Income tax payable............................................ -- 2 2
Current portion of long-term debt............................. 43 44 44
------ ------ -------
518 507 515
DEFERRED INCOME TAXES........................................... 3 3 3
LONG-TERM DEBT (Note 6)......................................... 542 507 497
------ ------ -------
1,063 1,017 1,015
------ ------ -------
COMMITMENTS AND CONTINGENT LIABILITY (Notes 8 and 9)
SHAREHOLDERS' EQUITY
Share capital
Authorized
1,000 4% non-cumulative, non-voting, redeemable,
retractible preference shares with a redemption value
of $1 each
4,000 common shares
Issued
500 preferred shares..................................... 1 1 1
100 common shares........................................ -- -- --
------ ------ -------
1 1 1
Retained earnings............................................... 256 263 288
------ ------ -------
257 264 289
------ ------ -------
$1,320 $1,281 $ 1,304
====== ====== =======

See accompanying notes to the consolidated financial statements

F-50
106

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(IN THOUSANDS OF CANADIAN DOLLARS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
---------------- ------------
1994 1995 1995 1996
------ ------ ---- ----
(UNAUDITED)

SALES......................................................... $3,100 $3,118 $777 $818
COST OF SALES................................................. 2,728 2,681 648 709
------ ------ ---- ----
GROSS PROFIT.................................................. 372 437 129 109
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.................. 244 272 56 35
------ ------ ---- ----
128 165 73 74
DEPRECIATION.................................................. 55 63 15 19
------ ------ ---- ----
OPERATING INCOME.............................................. 73 102 58 55
OTHER (INCOME) EXPENSES
Interest.................................................... 109 102 32 32
Other....................................................... (20) (9) (3) (2)
------ ------ ---- ----
INCOME (LOSS) BEFORE INCOME TAXES............................. (16) 9 29 25
INCOME TAXES (RECOVERY OF) PROVISION FOR...................... (3) 2 -- --
------ ------ ---- ----
NET INCOME (LOSS)............................................. (13) 7 29 25
RETAINED EARNINGS, BEGINNING OF PERIOD........................ 307 256 256 263
------ ------ ---- ----
294 263 285 288
DIVIDENDS..................................................... 38 -- -- --
------ ------ ---- ----
RETAINED EARNINGS, END OF PERIOD.............................. $ 256 $ 263 $285 $288
====== ====== ==== ====

See accompanying notes to the consolidated financial statements

F-51
107

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
(IN THOUSANDS OF CANADIAN DOLLARS)

YEAR ENDED THREE MONTHS
DECEMBER 31 ENDED MARCH 31
-------------- --------------
1994 1995 1995 1996
----- ----- ----- -----
(UNAUDITED)

NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING
ACTIVITIES
OPERATING
Net income (loss).......................................... $ (13) $ 7 $ 29 $ 25
Items not affecting cash
Depreciation............................................ 55 63 15 19
Loss on disposal of property and equipment.............. -- (3) (2) --
----- ----- ----- -----
42 67 42 44
Changes in non-cash operating working capital items........ (19) (35) 2 (22)
----- ----- ----- -----
23 32 44 22
----- ----- ----- -----
FINANCING
Issue of share capital..................................... 1 -- -- --
Reduction in term loans receivable......................... 4 20 4 3
Issue of long-term debt.................................... 93 14 -- --
Repayment of long-term debt................................ (56) (48) (3) (10)
Dividends paid............................................. (38) -- -- --
----- ----- ----- -----
4 (14) 1 (7)
----- ----- ----- -----
INVESTING
Acquisition of property and equipment...................... (132) (9) (7) (25)
Proceeds on disposal of property and equipment............. 13 8 2 --
----- ----- ----- -----
(119) (1) (5) (25)
----- ----- ----- -----
NET CASH INFLOW (OUTFLOW).................................... (92) 17 40 (10)
BANK INDEBTEDNESS, BEGINNING OF PERIOD....................... (238) (330) (330) (313)
----- ----- ----- -----
BANK INDEBTEDNESS, END OF PERIOD............................. $(330) $(313) $(290) $(323)
===== ===== ===== =====

See accompanying notes to the consolidated financial statements

F-52
108

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS OF CANADIAN DOLLARS)

1. DESCRIPTION OF BUSINESS

Action Delivery and Messenger Service Limited is incorporated under the
laws of the Province of Nova Scotia, and is primarily involved in the provision
of same-day delivery service in the metropolitan Halifax area.

2. ACCOUNTING POLICIES

The consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in Canada and conform in all material
respects, with those of the United States, and include the following significant
accounting policies:

Consolidation

The financial statements include the accounts of Action Delivery and
Messenger Service Limited and its wholly owned subsidiaries, Atlantic Medical
Transportation Services Limited and Atlantic Bonded Courier Services Limited.

Inventories

Inventory is valued at lower of cost and replacement cost.

Property and Equipment

Property and equipment are stated at cost. Depreciation is calculated using
the declining-balance method at the following annual rates:

Building.............................................. 4%
Furniture and equipment............................... 20%
Radios................................................ 20%
Computer equipment.................................... 30%
Vehicles.............................................. 30%

3. PROPERTY AND EQUIPMENT

DECEMBER 31,
----------------- MARCH 31,
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Land and land improvements............................ $ 111 $ 111 $ 111
Building.............................................. 618 618 629
Furniture and equipment............................... 83 84 85
Radios................................................ 122 122 122
Computer equipment.................................... 106 114 117
Vehicles.............................................. 94 30 40
------ ------ ------
1,134 1,079 1,104
Less: Accumulated depreciation........................ 350 354 373
------ ------ ------
$ 784 $ 725 $ 731
====== ====== ======

F-53
109

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

4. TERM LOANS RECEIVABLE

DECEMBER 31
------------ MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

11.50% term loan receivable, repayable in monthly
installments of $0.5, principal and interest, until
November, 1996............................................. $ 9 $ 4 $ 3
11.50% term loan receivable, repayable in monthly
installments of $0.4, principal and interest, until July,
1997....................................................... 10 5 4
11.50% term loan receivable, repayable in monthly
installments of $0.5, principal and interest, until
October, 1996.............................................. 10 5 4
11.50% term loan receivable, repayable in monthly
installments of $0.5, principal and interest, until
October, 1995.............................................. 6 -- --
--- --- ---
35 14 11
Less: Current portion........................................ 20 14 10
--- --- ---
$15 $-- $ 1
=== === ===

5. BANK INDEBTEDNESS

The company's bank indebtedness is secured by a pledge of its accounts
receivable and debentures in the amount of $750 providing first fixed and
floating charges on all of the companys assets. Bank indebtedness includes the
following amounts:

DECEMBER 31
------------ MARCH 31,
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Demand loan, bearing interest at prime plus 1.5%........... $300 $235 $242
Demand loan, bearing interest at prime plus 2%............. -- 70 70
Cheques issued in excess of funds on deposit............... 30 8 11
---- ---- ----
$330 $313 $323
==== ==== ====

6. LONG-TERM DEBT

DECEMBER 31,
------------ MARCH 31,
1994 1995 1996
---- ---- -----------
(UNAUDITED)

8.5% mortgage, payable in monthly installments of $5
including principal and interest. The mortgage is secured
by land and building having a carrying value of $596..... $474 $466 $ 463
Term bank loan, bearing interest at prime plus 1.75%,
payable in monthly installments of $2 including principal
and interest, maturing September, 1999, secured by
specific equipment....................................... 69 67 65
Term bank loan, bearing interest at prime plus 2%, payable
in monthly installments of $0.4 including principal and
interest, maturing June, 1997, secured by a specific
vehicle.................................................. 10 6 5

F-54
110

ACTION DELIVERY AND MESSENGER SERVICE LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS OF CANADIAN DOLLARS)

DECEMBER 31, MARCH 31,
1994 1995 1996
---- ---- ----
(UNAUDITED)

Term bank loan, bearing interest at prime plus 2%, payable
in monthly installments of $0.4 including principal and
interest, maturing December, 1996, secured by a specific
vehicle.................................................. 10 5 4
Term bank loan, bearing interest at prime plus 2%, payable
in monthly installments of $0.4 including principal and
interest, maturing August, 1996, secured by a specific
vehicle.................................................. 8 4 2
Term bank loan, bearing interest at prime plus 2%, payable
in monthly installments of $0.4 including principal and
interest, maturing October, 1996, secured by a specific
vehicle.................................................. 7 3 2
Term bank loan, bearing interest at prime plus 2%, payable
in monthly installments of $3 including principal and
interest, matured February, 1995, secured by a specific
vehicle.................................................. 7 -- --
---- ---- ----
585 551 541
Less: Current portion...................................... 43 44 44
---- ---- ----
$542 $507 $ 497
==== ==== ====

The principal due within each of the next five years on long-term debt,
assuming financing of the mortgage under similar terms, is approximately as
follows:

1996................................................... $44
1997................................................... 33
1998................................................... 33
1999................................................... 24
2000................................................... 15

7. RELATED PARTY TRANSACTIONS

Management fees paid to an associated company for the years ended December
31, 1994 and 1995 and for the three months ended March 31, 1995 and 1996 were
$18, $36, $8 (unaudited) and $8 (unaudited), respectively.

8. CONTINGENT LIABILITY

The company has outstanding letters of credit to I/F/O Canada Post
totalling $40 which are due February 29, 1997.

9. COMMITMENT

The company is renting office equipment and a truck under long-term leases
expiring in 2000 and 2002, respectively. The annual rent is approximately $15.

F-55
111

INDEPENDENT AUDITORS' REPORT

To the Shareholders of
Southbank Courier, Inc.

We have audited the accompanying consolidated balance sheets of Southbank
Courier, Inc. as at December 31, 1994 and 1995, and the related consolidated
statements of operations and retained earnings and of cash flows for the years
then ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of the Southbank Courier, Inc. as
of December 31, 1994 and 1995, and the results of their operations and their
cash flows for the years then ended in conformity with generally accepted
accounting principles.

DELOITTE & TOUCHE

Toronto, Ontario
May 22, 1996

F-56
112

SOUTHBANK COURIER, INC.

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

ASSETS
CURRENT
Cash........................................................... $ 45 $ -- $ 61
Account receivable (net of allowance for doubtful accounts of
$45, $45 and $45 (unaudited) at December 31, 1994 and 1995
and March 31, 1996, respectively)........................... 260 298 338
Other current assets (Note 2).................................. 17 21 25
---- ---- ----
322 319 424
PROPERTY AND EQUIPMENT -- net (Note 3)........................... 19 24 23
---- ---- ----
$341 $343 $447
==== ==== ====
LIABILITIES
CURRENT
Bank indebtedness.............................................. $ -- $ 6 $ --
Accounts payable............................................... 18 10 21
Accrued liabilities............................................ 7 3 5
Income taxes payable........................................... 6 -- --
---- ---- ----
31 19 26
---- ---- ----
COMMITMENTS (Note 5)
SHAREHOLDERS' EQUITY
Common stock; 200 shares authorized, 200 shares outstanding
(Note 4).................................................... 374 374 374
Retained earnings (deficit).................................... (64) (50) 47
---- ---- ----
310 324 421
---- ---- ----
$341 $343 $447
==== ==== ====

See accompanying notes to the consolidated financial statements

F-57
113

SOUTHBANK COURIER, INC.

CONSOLIDATED STATEMENT OF OPERATIONS AND RETAINED EARNINGS
(IN THOUSANDS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
----------------- -------------
1994 1995 1995 1996
------ ------ ---- ----
(UNAUDITED)

SALES...................................................... $1,597 $2,006 $477 $576
COST OF SALES.............................................. 739 957 245 259
------ ------ ---- ----
GROSS PROFIT............................................... 858 1,049 232 317
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES................................................. 759 1,002 215 213
DEPRECIATION AND AMORTIZATION.............................. 8 22 1 1
------ ------ ---- ----
OPERATING INCOME........................................... 91 25 16 103
INTEREST EXPENSE........................................... 13 -- -- --
------ ------ ---- ----
INCOME BEFORE INCOME TAXES................................. 78 25 16 103
PROVISION FOR INCOME TAXES................................. 14 11 10 6
------ ------ ---- ----
NET INCOME................................................. 64 14 6 97
(DEFICIT), BEGINNING OF PERIOD............................. (128) (64) (64) (50)
------ ------ ---- ----
RETAINED EARNINGS (DEFICIT), END OF PERIOD................. $ (64) $ (50) $(58) $ 47
====== ====== ==== ====

See accompanying notes to the consolidated financial statements

F-58
114

SOUTHBANK COURIER, INC.

STATEMENT OF CASH FLOWS
(IN THOUSANDS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
------------- -------------
1994 1995 1995 1996
---- ---- ---- ----
(UNAUDITED)

OPERATING ACTIVITIES
Net income for the period................................... $ 64 $ 14 $ 6 $ 97
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization............................ 8 22 1 1
Interest expense converted to common stock............... 13 -- -- --
Loss (gain) on disposal of fixed assets.................. 11 (1) -- --
---- ---- ---- ----
96 35 7 98
Changes non-cash working capital balances
Account receivable -- net................................ (59) (38) (66) (40)
Other current assets..................................... (3) (4) (1) (4)
Accounts payable and accrued liabilities................. (23) (12) 58 13
Income taxes payable..................................... (2) (6) -- --
---- ---- ---- ----
9 (25) (2) 67
---- ---- ---- ----
FINANCING ACTIVITIES
Long-term debt.............................................. 18 -- -- --
---- ---- ---- ----
INVESTING ACTIVITIES
Acquisition of property and equipment....................... (13) (29) -- --
Proceeds on disposal of property and equipment.............. -- 3 -- --
---- ---- ---- ----
(13) (26) -- --
---- ---- ---- ----
INCREASE (DECREASE) IN CASH POSITION.......................... 14 (51) (2) 67
CASH POSITION, BEGINNING OF PERIOD............................ 31 45 45 (6)
---- ---- ---- ----
CASH POSITION, END OF PERIOD.................................. $ 45 $ (6) $ 43 $ 61
==== ==== ==== ====
CASH POSITION IS COMPRISED OF:
Cash........................................................ $ 45 $ -- $ 43 $ 61
Bank indebtedness........................................... -- (6) -- --
---- ---- ---- ----
$ 45 $ (6) $ 43 $ 61
==== ==== ==== ====

See accompanying notes to the consolidated financial statements

F-59
115

SOUTHBANK COURIER, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1994 AND 1995
(IN THOUSANDS)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements of Southbank Courier, Inc. include
the accounts of the Company and its wholly-owned subsidiaries Van Man, Inc. and
Flying Pigs, Inc.

Property and Equipment

Property and equipment are recorded at cost. Depreciation and amortization
is provided at the following rates:

Vehicles......................................... 20% diminishing-balance basis
Computers........................................ 20% diminishing-balance basis
Radio equipment.................................. 14% diminishing-balance basis
Furniture & fixtures............................. 14% - 20% diminishing-balance basis
Leasehold Improvements........................... term of lease, straight-line

Revenue Recognition

Revenue is recognized when the services are rendered to customers.

Accounting Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

2. OTHER CURRENT ASSETS

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Due from employees......................................... $ 4 $10 $ 6
Security deposits.......................................... 8 8 8
Other...................................................... 5 3 11
--- --- ---
$17 $21 $25
=== === ===

F-60
116

SOUTHBANK COURIER, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

3. PROPERTY AND EQUIPMENT

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Vehicles................................................... $ 4 $-- $--
Furniture & fixtures....................................... 3 3 3
Radio equipment............................................ 29 33 33
Computer equipment......................................... 5 27 27
Leasehold improvements..................................... 11 11 11
--- --- ---
52 74 74
Less: Accumulated depreciation and amortization............ 33 50 51
--- --- ---
$19 $24 $23
=== === ===

4. RELATED PARTY TRANSACTIONS

The companies paid management fees totalling $70, $172, $35 (unaudited),
and $4 (unaudited) to a shareholder during the years ended December 31, 1994 and
1995 and the three months ended March 31, 1995 and 1996, respectively.

5. COMMITMENTS

The Company leases office space under operating lease agreements which
expire in September 1997.

At December 31, 1995, future minimum lease payments for such leases are as
follows:

1996................................................... $22
1997................................................... 16
---
$38
===

Rent expense for the years ended December 31, 1994 and 1995 and for the
three months ended March 31, 1995 and 1996 was $58, $64, $16 (unaudited) and $20
(unaudited), respectively.

F-61
117

INDEPENDENT AUDITORS' REPORT

To the Shareholders of
Seko Enterprises, Inc. and Related Companies

We have audited the combined balance sheets of Seko Enterprises, Inc. and
Related Companies as at December 31, 1994 and 1995 and the combined statements
of income and retained earnings and cash flows for the years then ended. These
combined financial statements are the responsibility of the Companies'
management. Our responsibility is to express an opinion on these combined
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 an audit to obtain
reasonable assurance whether the combined financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the combined 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, such combined financial statements present fairly, in all
material respects, the financial position of Seko Enterprises, Inc. and Related
Companies as at December 31, 1994 and 1995 and the results of their operations
and the changes in their cash flows for the years then ended in conformity with
generally accepted accounting principles.

DELOITTE & TOUCHE

Toronto, Ontario
April 5, 1996

F-62
118

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

COMBINED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)

DECEMBER 31
----------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

ASSETS
CURRENT
Accounts receivable (net of allowance for doubtful accounts
of $79; $72; $50 (unaudited) at December 31, 1994 and
1995 and March 31, 1996, respectively)................... $1,018 $ 981 $ 922
Prepaid and other assets (Note 4)........................... 354 387 341
------ ------ -----------
1,372 1,368 1,263
PROPERTY AND EQUIPMENT -- net (Note 5)........................ 1,791 1,785 1,790
INTANGIBLES -- net (Note 6)................................... 84 311 307
OTHER ASSETS (Note 7)......................................... 13 17 18
------ ------ -----------
$3,260 $3,481 $ 3,378
====== ====== =========
LIABILITIES
CURRENT
Bank indebtedness........................................... $ 3 $ 34 $ 60
Accounts payable and accrued liabilities (Note 8)........... 392 418 394
Due to stockholders......................................... 579 845 698
Current portion of notes payable (Note 9)................... -- 70 70
Current portion of long-term debt (Note 10)................. 9 12 12
------ ------ -----------
983 1,379 1,234
NOTES PAYABLE (Note 10)....................................... -- 93 88
LONG-TERM DEBT (Notes 11)..................................... 1,093 1,082 1,082
------ ------ -----------
2,076 2,554 2,404
------ ------ -----------
COMMITMENTS AND CONTINGENT LIABILITIES (Note 11)
SHAREHOLDERS' EQUITY
Common stock
Seko -- (No par value; authorized 1,000 shares; issued 200
shares)
Metro -- (No par value; authorized 1,000 shares; issued 100
shares)
Attention -- (No par value; authorized 1,000 shares; issued
100 shares)
National -- (No par value; authorized 1,000 shares; issued
100 shares).............................................. 10 10 10
Additional paid-in capital.................................... 50 70 150
Retained earnings............................................. 1,124 847 814
------ ------ -----------
1,184 927 974
------ ------ -----------
$3,260 $3,481 $ 3,378
====== ====== =========

See accompanying notes to the combined financial statements

F-63
119

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

COMBINED STATEMENTS OF INCOME AND RETAINED EARNINGS
(IN THOUSANDS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
---------------- ----------------
1994 1995 1995 1996
------ ------ ------ ------
(UNAUDITED)

SALES...................................................... $9,053 $8,489 $2,104 $2,062
COST OF SALES.............................................. 4,838 4,421 1,140 1,111
------ ------ ------ ------
GROSS PROFIT............................................... 4,215 4,068 964 951
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES................................................. 3,825 3,886 897 941
DEPRECIATION AND AMORTIZATION.............................. 196 174 30 38
------ ------ ------ ------
OPERATING INCOME (LOSS).................................... 194 8 37 (28)
------ ------ ------ ------
OTHER (INCOME) EXPENSE
Interest................................................. 129 129 36 38
Other.................................................... (113) (105) (29) (33)
------ ------ ------ ------
16 24 7 5
------ ------ ------ ------
INCOME (LOSS) BEFORE TAXES................................. 178 (16) 30 (33)
INCOME TAXES............................................... 3 11 11 --
------ ------ ------ ------
NET INCOME (LOSS).......................................... 175 (27) 19 (33)
RETAINED EARNINGS, BEGINNING OF PERIOD..................... 949 1,124 1,124 847
DIVIDENDS.................................................. -- 250 -- --
------ ------ ------ ------
RETAINED EARNINGS, END OF PERIOD........................... $1,124 $ 847 $1,143 $ 814
====== ====== ====== ======

See accompanying notes to the combined financial statements

F-64
120

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

THREE MONTHS
YEAR ENDED ENDED
DECEMBER 31 MARCH 31
-------------- --------------
1994 1995 1995 1996
----- ----- ----- -----
(UNAUDITED)

OPERATING ACTIVITIES
Net income (loss).......................................... $ 175 $ (27) $ 19 $ (33)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities
Depreciation and amortization........................... 196 174 30 38
Increase in cash value of life insurance................ (2) (4) (1) (1)
Changes in operating assets and liabilities
Accounts receivable, net.............................. (156) 37 41 59
Prepaid and other current assets...................... (12) (33) 36 46
Accounts payable and accrued liabilities.............. (242) 26 7 (24)
Due to stockholders................................... 336 266 (180) (147)
----- ----- ----- -----
Net cash provided by (used in) operating activities........ 295 439 (48) (62)
INVESTING ACTIVITIES
Additions to property and equipment, net................... (86) (158) (7) (39)
Additions to intangibles, net.............................. (35) (237) (57) --
----- ----- ----- -----
Net cash used in investing activities...................... (121) (395) (64) (39)
----- ----- ----- -----
FINANCING ACTIVITIES
Principal payments on long-term debt....................... 3 (8) (2) --
(Redemption) issuance of common stock...................... (1) 20 -- --
Notes payable.............................................. -- 163 77 (5)
Payment of dividends and return of capital................. (49) (250) -- 80
----- ----- ----- -----
Net cash provided by (used in) financing activities........ (47) (75) 75 75
----- ----- ----- -----
NET DECREASE (INCREASE) IN BANK INDEBTEDNESS................. 127 (31) (37) (26)
BANK INDEBTEDNESS, BEGINNING OF PERIOD....................... (130) (3) (3) (34)
----- ----- ----- -----
BANK INDEBTEDNESS, END OF PERIOD............................. $ (3) $ (34) $ (40) $ (60)
===== ===== ===== =====
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for
Interest................................................ $ 129 $ 129 $ 36 $ 38
Income taxes............................................ 2 -- -- --
----- ----- ----- -----
$ 131 $ 129 $ 36 $ 38
===== ===== ===== =====

See accompanying notes to the combined financial statements

F-65
121

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS)

1. BUSINESS AND ORGANIZATION

Seko Enterprises, Inc., Metro Messenger, Inc., Attention Messenger, Inc.
and National Messenger System, Inc. (collectively the "Companies") are engaged
in the courier business primarily in the Chicago metropolitan area. The
Companies provide courier services through the use of independent contractors.

2. PRINCIPLES OF COMBINATION

The Companies are under common control of a single shareholder either
directly or through wholly-owned companies and have been combined due to their
interdependence and form of operations. The combined financial statements
include the accounts of Seko Enterprises, Inc., Metro Messenger, Inc., Attention
Messenger, Inc. and National Messenger System, Inc. after all intercompany
balances have been eliminated.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Depreciation is computed over the estimated useful lives of the assets as
indicated in the following table by use of the straight-line and the accelerated
methods used for tax purposes.

YEARS METHOD
------ -------------------------------

Buildings and improvements................. 31.5 MACRS
Leasehold improvements..................... 5 Straight-line
Computers and programs..................... 5 Straight-line, ACRS, and MACRS
Equipment and fixtures..................... 5-7 Straight-line, ACRS, and MACRS
Vehicles................................... 5 ACRS and MACRS

Intangibles

Customer lists and covenants not to compete are amortized over 15 years
under the straight-line method.

Income Taxes

Certain of the Companies are S Corporations for income tax purposes and,
accordingly, any income tax liabilities are the responsibility of the respective
stockholders. The Companies have elected to have its stockholders taxed directly
on all income pursuant to Section 1377 of the Internal Revenue Code.
Accordingly, these combined financial statements, do not reflect income taxes
for these S Corporations. Federal and state income taxes have been provided for
C Corporations.

Accounting Estimates

F-66
122

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

4. PREPAID AND OTHER CURRENT ASSETS

Prepaid and other current assets consist of the following:

DECEMBER 31
------------------- MARCH 31
1994 1995 1996
------- ------- -----------
(UNAUDITED)

Prepaid insurance................................... $ 46 $ 65 $ 35
Prepaid expenses.................................... 31 49 17
Employee receivables................................ 12 19 16
Deposits............................................ 5 25 22
Income taxes recoverable............................ -- 41 35
Due from shareholder................................ 85 83 84
Other............................................... 175 105 132
------- ------- -------
$ 354 $ 387 $ 341
======= ======= =======

5. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

DECEMBER 31
------------------- MARCH 31
1994 1995 1996
------- ------- -----------
(UNAUDITED)

Land................................................ $ 343 $ 343 $ 343
Buildings and improvements.......................... 1,459 1,459 1,459
Leasehold improvements.............................. 17 17 17
Computers and programs.............................. 829 875 875
Equipment and fixtures.............................. 1,036 1,081 1,097
Vehicles............................................ 278 320 343
------- ------- -------
3,962 4,095 4,134
Less accumulated depreciation....................... (2,171) (2,310) (2,344)
------- ------- -------
$ 1,791 $ 1,785 $ 1,790
======= ======= =======

6. INTANGIBLES

Intangibles consist of the following:

DECEMBER 31
------------------- MARCH 31
1994 1995 1996
------- ------- -----------
(UNAUDITED)

Goodwill............................................ $ 41 $ 16 $ 16
Customer lists...................................... 98 240 240
Covenants not to compete............................ 117 130 130
------- ------- -------
256 386 386
Less accumulated amortization....................... (172) (75) (79)
------- ------- -------
$ 84 $ 311 $ 307
======= ======= =======

F-67
123

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

7. OTHER ASSETS

Other assets consist of the following:

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Cash surrender value of life insurance policy............. $13 $17 $18
=== === ===

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities consist of the following:

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Accounts payable.......................................... $128 $145 $108
Accrued payroll and related benefits and commissions...... 214 167 130
Income taxes payable...................................... 2 -- --
Other accrued liabilities................................. 48 106 156
---- ---- ----
$392 $418 $394
==== ==== ====

9. NOTES PAYABLE

Notes payable consists of the following:

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Notes payable to competitors.............................. $-- $163 $158
Less current portion...................................... -- 70 70
--- ---- ----
$-- $ 93 $ 88
=== ==== ====

Certain of the Companies have acquired customer lists from competitors. As
part of the consideration for the acquisition of these assets, the Companies are
committed to pay a percentage of the gross sales derived from these customers of
5.83% to 10%, for terms of 36 months.

F-68
124

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

10. LONG-TERM DEBT

Long-term debt consists of the following:

DECEMBER 31
----------------- MARCH 31
1994 1995 1996
------ ------ -----------
(UNAUDITED)

Mortgage payable to NSK Enterprises, Inc.
No set maturity, interest at 12% monthly payments of
interest only secured by a first charge on
9250 Ivanhoe Street property......................... $ 537 $ 537 $ 537
Mortgage payable,
Maturing June 1, 1995, interest at 10.5%, monthly
payments of principal and interest, secured by a
first charge on
939 W. Lake Street property.......................... 559 -- --
Mortgage payable,
Maturing August 1, 2005, interest at 9%, monthly
payments of principal and interest, secured by a
first charge on
939 W. Lake Street property.......................... -- 555 557
Loan payable,
Maturing May 1, 1996, interest at 3.9%, monthly
payments of principal and interest, secured by
automobile........................................... 6 2 --
------ ------ ------
1,102 1,094 1,094
Less current portion................................... 9 12 12
------ ------ ------
$1,093 $1,082 $1,082
====== ====== ======

At March 31, 1996, the aggregate amounts of principal maturities of
long-term obligations are as follows:

(UNAUDITED)

1996............................................................. $ 12
1997............................................................. 8
1998............................................................. 9
1999............................................................. 10
2000............................................................. 11
Thereafter....................................................... 1,044
-------
Total............................................................ $ 1,094
=======

11. COMMITMENTS AND CONTINGENT LIABILITIES

Litigation

The Companies are, from time to time, a party to litigation arising in the
normal course of its business, most of which involve claims for personal injury
and property damage incurred in connection with its operations. Management
believes that none of these actions will have a material adverse effect on the
financial position or results of operations of the Companies.

F-69
125

SEKO ENTERPRISES, INC. AND RELATED COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

12. PENSION PLAN

The pension plan covers employees of all of the Companies. Through 1994,
the plan provided pension benefits based on years of service and the employee's
compensation during the five highest consecutive years of participation. The
pension plan benefit formula was amended effective April 1, 1989 to reflect new
provisions of the Tax Reform Act of 1986. These amendments resulted in a
decrease in the future benefits provided. The benefits earned as of April 1,
1989 by existing participants were not reduced; however, in many cases, these
benefits exceed projected benefits under the amended formula. During 1995, the
plan was amended to change the method by which participant benefits are
calculated effective March 31, 1994, with benefits earned subsequently using the
amended formula. The projected benefit obligation correspondingly decreased by
approximately $223 and is being amortized over 19 years. The Companies' funding
policy is to contribute annually an amount greater than the minimum or up to the
maximum amount that can be deducted for federal income tax purposes.
Contributions are intended to provide not only for benefits attributed to
service to date but also for those expected to be earned in the future. The
plans assets consist principally of mutual funds.

The following table sets forth the plan's funded status and amounts
recognized in the Companies' balance sheets:

DECEMBER 31
-----------------
1994 1995
------ ------

Actuarial present value of benefit obligations:
Accumulated benefit obligations, including vested benefits of $775
and $26, respectively............................................ $ 793 $ 26
====== ======
Projected benefit obligations for service rendered to date......... $1,027 $ 68
Plan assets at fair value.......................................... 1,127 519
------ ------
Plan assets in excess of projected benefit obligation.............. 100 450
Unrecognized net loss from past experience different that
assumed.......................................................... 231 89
Unrecognized prior service cost.................................... -- (212)
Unrecognized net asset as of April 1, 1989, being recognized over
19 years......................................................... (260) (242)
------ ------
Prepaid pension cost included in prepaid and other current
assets........................................................... $ 71 $ 85
====== ======

Net pension (benefit) cost for the years ended December 31, 1994 and 1995
include the following components:

1994 1995
------ ------

Service cost -- benefits earned during the year.................... $ 53 $ 56
Interest cost on projected benefit obligation...................... 72 1
Plan assets at fair value.......................................... 7 (29)
Plan assets in excess of projected benefit obligation.............. (117) (42)
------ ------
Net periodic pension (benefit)..................................... $ 15 $ (14)
====== ======

Assumptions used in the above calculations are as follows:

AS OF MARCH 31,
1994 AND 1995
---------------

Discount rates................................................ 8.0%
Rates of increase in compensation levels...................... 5.0
Expected long-term rate of return on assets................... 8.0

The 1994 and 1995 figures include benefits for 19 employees of Metro
Messenger, Inc. and 9 employees of National Messenger System, Inc., whose
employees are covered under the same plan (83 in 1994; 82 in 1995 in total).

F-70
126

INDEPENDENT AUDITORS' REPORT

To the Shareholder of Seidel Delivery

We have audited the accompanying combined balance sheets of Seidel Delivery
as of December 31, 1994 and 1995, and the related combined statements of income
and retained earnings and of cash flows for the years then ended. The combined
financial statements include the accounts of Seidel Enterprises, Inc. and NOW
Courier, Inc. (collectively "the Companies"), which do business as Seidel
Delivery and are under common ownership by an individual shareholder. These
financial statements are the responsibility of the Companies management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, such combined financial statements present fairly, in all
material respects, the combined financial position of Seidel Delivery as of
December 31, 1994 and 1995, and the results of their operations and their cash
flows for the years then ended in conformity with generally accepted accounting
principles.

DELOITTE & TOUCHE LLP

Columbus, Ohio
March 22, 1996

F-71
127

SEIDEL DELIVERY

COMBINED BALANCE SHEETS
(IN THOUSANDS)

DECEMBER 31
----------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

ASSETS
CURRENT
Cash and cash equivalents.......................................... $ 18 $ 40 $ 64
Accounts receivable................................................ 196 181 175
Prepaid expenses and other......................................... 41 53 40
---- ---- -----
255 274 279
PROPERTY AND EQUIPMENT -- net (Note 3)............................... 62 50 46
---- ---- -----
$317 $324 $ 325
==== ==== =====
LIABILITIES
CURRENT
Accounts payable
Trade........................................................... $ 28 $ 31 $ 13
Affiliate....................................................... 30 -- --
Shareholder..................................................... -- 5 5
Accrued expenses
Payroll and related expenses.................................... 30 33 17
Other........................................................... 19 18 36
---- ---- -----
107 87 71
---- ---- -----
SHAREHOLDER'S EQUITY
Common stock:
Seidel -- 3,000 shares authorized, 1,660 shares issued and
outstanding, no par value
NOW -- 500 shares authorized, 50 shares issued and outstanding,
no par value................................................... 12 12 12
Retained earnings.................................................. 198 225 242
---- ---- -----
210 237 254
---- ---- -----
$317 $324 $ 325
==== ==== =====

See accompanying notes to the combined financial statements

F-72
128

SEIDEL DELIVERY

COMBINED STATEMENTS OF INCOME AND RETAINED EARNINGS
(IN THOUSANDS)

YEAR ENDED THREE MONTHS
DECEMBER 31 MARCH 31
----------------- -------------
1994 1995 1995 1996
------ ------ ---- ----
(UNAUDITED)

SALES...................................................... $1,929 $1,776 $457 $417
COST OF SALES.............................................. 1,184 1,116 284 263
------ ------ ---- ----
GROSS PROFIT............................................... 745 660 173 154
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES............... 701 628 150 137
DEPRECIATION AND AMORTIZATION.............................. 20 19 5 5
------ ------ ---- ----
OPERATING INCOME........................................... 24 13 18 12
OTHER INCOME............................................... 3 21 5 7
------ ------ ---- ----
INCOME BEFORE PROVISION FOR INCOME TAXES................... 27 34 23 19
PROVISION FOR INCOME TAXES................................. 2 7 1 2
------ ------ ---- ----
NET INCOME................................................. 25 27 22 17
RETAINED EARNINGS, BEGINNING OF PERIOD..................... 173 198 198 225
------ ------ ---- ----
RETAINED EARNINGS, END OF PERIOD........................... $ 198 $ 225 $220 $242
====== ====== ==== ====

See accompanying notes to the combined financial statements

F-73
129

SEIDEL DELIVERY

COMBINED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

YEAR ENDED THREE MONTHS
DECEMBER 31 MARCH 31
------------- -------------
1994 1995 1995 1996
---- ---- ---- ----
(UNAUDITED)

OPERATING ACTIVITIES
Net income.................................................. $ 25 $ 27 $ 22 $ 17
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization............................ 20 19 5 4
Loss on disposal of property and equipment............... 3 -- -- --
Change in operating assets and liabilities:
Accounts receivable.................................... 23 15 12 6
Prepaid expenses and other............................. (7) (12) 12 13
Accounts payable and accrued expenses.................. (44) (20) (32) (16)
---- ---- ---- ----
Net cash provided by operating activities................... 20 29 19 24
INVESTING ACTIVITIES
Capital expenditures for property and equipment............. (9) (7) (5) --
---- ---- ---- ----
NET INCREASE IN CASH AND CASH EQUIVALENTS..................... 11 22 14 24
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD................ 7 18 18 40
---- ---- ---- ----
CASH AND CASH EQUIVALENTS, END OF PERIOD...................... $ 18 $ 40 $ 32 $ 64
==== ==== ==== ====
SUPPLEMENTAL INFORMATION
Cash paid during the period for income taxes................ $ 3 $ 7 $ -- $ --
==== ==== ==== ====

See accompanying notes to the combined financial statements

F-74
130

SEIDEL DELIVERY

NOTES TO THE COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The combined financial statements of Seidel Delivery (collectively the
"Companies") include the accounts of Seidel Enterprises, Inc. ("Seidel") and NOW
Courier, Inc. ("NOW") and is engaged in the courier business primarily in
central Ohio, and provide services through the use of independent contractors.

Revenue Recognition -- Revenues are recorded when deliveries are complete.

Nature of Combination -- The Companies are under the common control of a
single shareholder and have been combined due to their interdependence and form
of operations. Seidel is a management company with the sole purpose of providing
management and administrative support to NOW, the operating company. NOW has no
employees and relies on sub-contractors for all labor needs. For combined
financial reporting purposes, all intercompany balances have been eliminated.

Property and Equipment -- Property and equipment are stated at cost.
Depreciation and amortization are provided using the straight-line method over
the estimated useful lives of the related assets as follows:

YEARS
------

Vehicles............................................ 5
Radio Equipment..................................... 5 - 10
Office furniture and equipment...................... 5

Income Taxes -- Deferred tax assets and liabilities, if any, are recognized
for the future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and liabilities and
their respective tax bases using the liability method. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The Companies had no deferred tax assets or liabilities at
December 31, 1994 and 1995 and March 31, 1996.

Cash and Cash Equivalents -- The Company considers all highly liquid debt
instruments with a maturity of three months or less when purchased to be cash
equivalents.

Accounting Estimates -- The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.

2. REVENUES FROM SIGNIFICANT CUSTOMERS

Revenues from five customers accounted for approximately 20% of the
Companies' revenues for the years ended December 31, 1994 and 1995 and for the
three months ended March 31, 1995 and 1996.

3. PROPERTY AND EQUIPMENT

DECEMBER 31
------------- MARCH 31
1994 1995 1996
---- ---- -----------
(UNAUDITED)

Vehicles................................................. $ 29 $ 29 $ 14
Radio equipment.......................................... 55 57 61
Office furniture and equipment........................... 72 69 71
---- ---- -----
156 155 146
Less: Accumulated depreciation........................... 94 105 100
---- ---- -----
$ 62 $ 50 $ 46
==== ==== =====

F-75
131

SEIDEL DELIVERY

NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

4. RELATED PARTY TRANSACTIONS

The Companies paid building rent to their shareholder during the years
ended December 31, 1994 and 1995 and the three months ended March 31, 1995 and
1996, totalling $42,000, $37,800, $10,500 (unaudited), and $10,500 (unaudited),
respectively.

The Companies paid certain license rental fees totaling $4,000 to a company
wholly-owned by their shareholder during 1994.

5. PENDING TRANSACTION

In March 1996, the shareholder entered into an agreement of intent for the
sale of 100% of the Companies common stock to an unrelated third party.

F-76
132

================================================================================

NO DEALER, SALES REPRESENTATIVE OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THIS OFFERING
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF ANY OFFER TO BUY COMMON STOCK BY ANYONE IN ANY
JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN
WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN
IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE OF THIS PROSPECTUS.
---------------------

TABLE OF CONTENTS

PAGE
----

Prospectus Summary.................... 3
Risk Factors.......................... 6
The Company........................... 11
Use of Proceeds....................... 12
Dividend Policy....................... 12
Capitalization........................ 13
Dilution.............................. 14
Selected Consolidated Financial
Data................................ 15
Pro Forma Financial Information....... 16
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 22
Business.............................. 27
Management............................ 37
Certain Transactions.................. 43
Principal Stockholders................ 45
Description of Capital Stock.......... 46
Shares Eligible For Future Sale....... 49
Underwriting.......................... 51
Legal Matters......................... 52
Experts............................... 52
Additional Information................ 53
Index to Financial Statements......... F-1

---------------------

UNTIL , 1996 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES OFFERED HEREBY,
WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A
PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF
DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO
THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

================================================================================

3,100,000 SHARES

[DYNAMEX LOGO]

COMMON STOCK
------------------------------

PROSPECTUS

, 1996

------------------------------
WILLIAM BLAIR & COMPANY

HOAK SECURITIES CORP.

================================================================================
133

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than
underwriting discounts and commissions. All of the amount shown are estimates
except the Securities and Exchange Commission registration and NASD filing fees.

Securities and Exchange Commission registration fee....................... $ 14,752
NASD filing fee........................................................... 4,778
Nasdaq National Market listing fee........................................ 33,274
Legal fees and expenses................................................... 150,000
Accounting fees and expenses.............................................. 275,000
Printing and engraving expenses........................................... 175,000
Transfer agent and registrar fees and expenses............................ 10,000
Blue Sky fees and expenses................................................ 15,000
Miscellaneous expenses.................................................... 122,196
--------
Total........................................................... $800,000
========

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Company's Restated Certificate of Incorporation eliminates to the
fullest extent permissible under the General Corporation Law of Delaware the
liability of directors to the Company and the stockholders for monetary damages
for breach of fiduciary duty as a director. This provision does not eliminate
liability (a) for any breach of a director's duty of loyalty to the Company or
its stockholders; (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of the law; (c) in connection with
payment of any illegal dividend or illegal stock repurchase; or (d) for any
transaction from which the director derives an improper personal benefit. In
addition, these provisions do not apply to equitable remedies such as injunctive
relief.

The Company's Bylaws provide that the Company shall indemnify each of its
directors and officers, acting in such capacity, so long as such person acted in
good faith and in a manner he or she reasonably believed to be in or not opposed
to the best interests of the Company. Such indemnification may be made only upon
a determination that such indemnification is proper in the circumstances because
the person to be indemnified has met the applicable standard of conduct to
permit indemnification under the law. The Company is also required to advance to
such persons payment for their expenses incurred in defending a proceeding to
which indemnification might apply, provided the recipient provides an
undertaking agreeing to repay all such advanced amounts if it is ultimately
determined that he is not entitled to be indemnified.

The Company also maintains a directors' and officers' liability insurance
policy insuring directors and officers of the Company for up to $5.0 million of
covered losses as defined in the policy. Reference is also made to the
indemnification and contribution provisions of the Underwriting Agreement filed
as an exhibit to this Registration Statement. The Company has entered into
Indemnification Agreements with each of its directors and certain of its
officers contractually requiring the Company to provide such indemnification to
the extent permitted by applicable law.

Pursuant to the Underwriting Agreement to be entered among the Company and
the Underwriters, officers and directors of the Company are indemnified for
certain liabilities, including liabilities incurred under the Securities Act of
1933, as amended.

II-1
134

ITEM 15. RECENT SALE OF UNREGISTERED SECURITIES

Since August 1, 1992, the Company has sold or issued the following
unregistered securities:

1. On November 16, 1993, (i) the Company declared a 17.2542-to-1 stock
dividend on the shares of Common Stock outstanding as of such date; (ii)
the Company issued to George M. Siegel 30,912 shares of Common Stock at a
purchase price of $3.24 per share, which purchase price was payable by Mr.
Siegel pursuant to a promissory note issued by Mr. Siegel to the Company on
such date; (iii) the Company issued to Cypress 1,236,096 shares of the
Company's convertible preferred stock and 309,024 shares of the Company's
Common Stock at a purchase price of $3.24 per share, which purchase price
was paid in cash by Cypress; and (iv) the Company issued to McFarland,
Grossman & Co. ("MGC") 5,000 shares of Common Stock at a purchase price of
$3.24 per share, which purchase price was paid in cash by MGC.

2. On May 31, 1995, at a purchase price of $4.25 per share (i) Cypress
converted its shares of convertible preferred stock and the dividends and
interest accrued thereon into Common Stock; (ii) the Company issued to
Cypress 294,116 shares of Common Stock, which purchase price was paid in
cash by Cypress; (ii) the Company issued to Preferred Risk Life Insurance
Company 147,056 shares and Preferred Risk Mutual Insurance Company
purchased 147,060 shares of Common Stock, which purchase prices were paid
in cash by such entities; and (iii) George M. Siegel purchased 20,000
shares of Common Stock, which purchase price was payable by Mr. Siegel
pursuant to a promissory note issued by Mr. Siegel to the Company on such
date.

3. On December 28, 1995, the Company issued and delivered
approximately $1.8 million of Bridge Notes to James M. Hoak, approximately
$1.0 million of Bridge Notes to Cypress, and approximately $1.8 million of
Bridge Notes to various limited partners of Cypress and affiliates of its
general partner in exchange for cash in the corresponding amounts. The
holders of the Bridge Notes received the Bridge Warrants which enable the
holders to purchase an aggregate of 1,080,000 shares of Common Stock at a
price of $.025 per share, which number of shares shall be reduced to
540,000 in the event that the Company has redeemed the Bridge Notes by June
30, 1996, which such date shall be extended to a date no later than
December 31, 1996 if the Company is actively engaged in the initial public
offering process during such time.

5. As partial consideration for consummation of the Acquisitions, the
Company will issue and aggregate of 126,170 shares of Common Stock
(assuming an initial public offering price of $11.00) to the stockholders
of the Acquired Companies.

6. Between August 1, 1992 and April 30, 1996, the Company granted
options to approximately six persons or entities, as the case may be, to
purchase an aggregate of 226,384 shares of the Company's Common Stock
pursuant to the Option Plan for purchase prices ranging from $3.19 to $4.25
per share. Options to purchase 17,000 shares have expired. In connection
with the Offering, the Company intends to grant options to 13 persons to
purchase an aggregate of 259,000 shares of the Company's Common Stock
pursuant to the Option Plan at the initial public offering price.

In issuing such securities, the Company relied on the exemption from the
registration and prospectus delivery requirements of the Securities Act provided
by Section 4(2) of the Securities Act.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits

EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------

II-2
135

EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------

2.2(2) -- Share Purchase Agreement, by and among Dynamex Inc., Zipper
Transportation Services Ltd., KHB & Associates Ltd, Kenneth Bishop
and Bruce Bishop, dated June 3, 1996.
2.3(2) -- Stock Purchase Agreement, by and among Dynamex Inc., NSK Enterprises,
Inc., Seko Enterprises, Inc., YS Corporation d/b/a Metro Messenger
Service Inc., Attention Messenger Service of Illinois, Inc., Dynamex
Inc., Norman Koppel and Joe Garcia, dated June 3, 1996.
2.4(2) -- Stock Purchase Agreement, by and among Dynamex Inc., Express-It
Acquisition Corp., Express-It Inc., Barry J. Steingard and William
Castor, dated June 3, 1996.
2.5(2) -- Agreement and Plan of Merger, by and among Dynamex Inc., SEI
Acquisition Corp., NCI Acquisition Corp., Seidel Enterprises, Inc,
Now Courier, Inc. and Edward F. Seidel, Jr., dated June 3, 1996.
3.1(2) -- Restated Certificate of Incorporation of Dynamex Inc.
3.2(2) -- Bylaws, as amended and restated, of Dynamex Inc.
4.1(2) -- Rights Agreement between Dynamex Inc. and Harris Trust and Savings
Bank, dated July 5, 1996.
5.1(2) -- Opinion of Crouch & Hallett, L.L.P.
10.1(2) -- Employment Agreement of Richard K. McClelland.
10.2(2) -- Consulting Agreement of George M. Siegel.
10.3(2) -- Dynamex Inc. 1996 Stock Option Plan.
10.4(2) -- Marketing and Transportation Services Agreement, between Purolator
Courier Ltd. and Parcelway Courier Systems Canada Ltd., dated
November 20, 1995.
10.5(2) -- Form of Indemnification and Hold Harmless Agreements with Executive
Officers and Directors.
10.6(2) -- Registration Rights Agreement by and among Dynamex Inc., Cypress,
McFarland Grossman & Co. and George M. Siegel, dated November 16,
1993, as amended by that Amendment No. 1 to Registration Rights
Agreement, dated May 31, 1995.
10.7(2) -- Registration Rights Agreement, by and among Dynamex Inc., Preferred
Risk Mutual Insurance Company, Preferred Life Insurance Company and
Richard K. McClelland, dated May 31, 1995.
10.8(2) -- Amended and Restated Credit Agreement by and among the Company and
NationsBank of Texas, N.A., as agent for the lenders named therein,
dated July 5, 1996.
10.9(2) -- Subordinated Renewal Promissory Note, payable by Dynamex Inc. to Air
Canada, in the original principal amount of Cdn $3,225,000, dated
December 28, 1995.
10.10(2) -- Form of Junior Subordinated Debenture, payable by Dynamex Inc., dated
December 28, 1995.
10.11(2) -- Form of Dynamex Inc. Common Stock Purchase Warrant, dated December
28, 1995.
10.12(2) -- Asset Purchase Agreement by and among Dynamex Operations East, Inc.,
Dynamex Operations West, Inc., Parcelway Courier Systems Canada Ltd.,
Mayne Nickless Incorporated, Mayne Nickless Canada Inc., Mayne
Nickless Courier Systems, Inc., Mayne Nickless Messenger Services,
Inc. and Mayne Nickless Transport Inc., dated December 29, 1995.
10.13(2) -- Asset Purchase Agreement by and among Parcelway Courier Systems
Canada Ltd. and Air Canada, dated May 31, 1995.
11.1(2) -- Statement re computation of earnings per share.

II-3
136

EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------

21.1(2) -- Subsidiaries of the Registrant.
23.1(1) -- Independent Auditors' Consent of Deloitte & Touche.
23.2(1) -- Independent Auditors' Consent of Deloitte & Touche LLP.
23.3(1) -- Independent Auditors' Consent of Price Waterhouse.
23.4(2) -- Consent of Crouch & Hallett, L.L.P. (included in Exhibit 5.1).
23.5(2) -- Consent of Kenneth Bishop as Nominee Director of Dynamex Inc.
23.6(2) -- Consent of E. T. Whalen as Nominee Director of Dynamex Inc.
24.1(2) -- Power of Attorney (included on page II-5).

- ---------------

(1) Filed herewith

(2) Previously filed

(b) Financial Schedules and Reports of Independent Auditors are as follows:

All schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.

ITEM 17. UNDERTAKINGS.

(a) The undersigned Registrant hereby undertakes to provide to the
Underwriters at the closing specified in the underwriting agreement certificates
in such denominations and registered in such names as required by the
Underwriters to permit prompt delivery to each purchaser.

(b) Insofar as indemnification for liabilities arising from the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

(1) For purposes of determining any liability under the Act, the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in the form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Act, each
post-effective amendment that contains a form of prospectus shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

II-4
137

SIGNATURES

Pursuant to the requirement of the Securities Act of 1933, the Registrant
has duly caused this amendment to this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of Dallas,
State of Texas on the 19th day of July, 1996.

DYNAMEX INC.

By: /s/ ROBERT P. CAPPS
------------------------------
Robert P. Capps, Vice
President-Finance
and Corporate Development

Pursuant to the requirements of the Securities Act of 1933, this amendment
to this Registration Statement has been signed by the following persons in the
capacities on the 19th day of July, 1996.

NAME TITLE
- --------------------------------------------- ----------------------------------------------

* President, Chief Executive Officer and
- --------------------------------------------- Chairman of the Board (Principal Executive
Richard K. McClelland Officer)

/s/ ROBERT P. CAPPS Vice President-Finance and Corporate
- --------------------------------------------- Development (Principal Financial Officer)
Robert P. Capps

* Controller and Secretary (Principal
- --------------------------------------------- Accounting Officer)
Martin A. Piccolo

* Director
- ---------------------------------------------
James M. Hoak

* Director
- ---------------------------------------------
Wayne Kern

* Director
- ---------------------------------------------
Stephen P. Smiley

* Director
- ---------------------------------------------
Brian J. Hughes

*By /s/ ROBERT P. CAPPS
------------------------------------------
Robert P. Capps
Attorney-in-Fact

II-5
138

INDEX TO EXHIBITS

EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------

1.1(2) -- Form of Underwriting Agreement.
2.1(2) -- Share Purchase Agreement, by and among Dynamex Inc., Action Delivery
and Messenger Service Limited, Nancy Smithers, David Nantau,
Naturally Nova Scotia Health Products Limited and 2306080 Nova Scotia
Limited dated June 20, 1996.
2.2(2) -- Share Purchase Agreement, by and among Dynamex Inc., Zipper
Transportation Services Ltd., KHB & Associates Ltd, Kenneth Bishop
and Bruce Bishop, dated June 3, 1996.
2.3(2) -- Stock Purchase Agreement, by and among Dynamex Inc., NSK Enterprises,
Inc., Seko Enterprises, Inc., YS Corporation d/b/a Metro Messenger
Service Inc., Attention Messenger Service of Illinois, Inc., Dynamex
Inc., Norman Koppel and Joe Garcia, dated June 3, 1996.
2.4(2) -- Stock Purchase Agreement, by and among Dynamex Inc., Express-It
Acquisition Corp., Express-It Inc., Barry J. Steingard and William
Castor, dated June 3, 1996.
2.5(2) -- Agreement and Plan of Merger, by and among Dynamex Inc., SEI
Acquisition Corp., NCI Acquisition Corp., Seidel Enterprises, Inc,
Now Courier, Inc. and Edward F. Seidel, Jr., dated June 3, 1996.
3.1(2) -- Restated Certificate of Incorporation of Dynamex Inc.
3.2(2) -- Bylaws, as amended and restated, of Dynamex Inc.
4.1(2) -- Rights Agreement between Dynamex Inc. and Harris Trust and Savings
Bank, dated July 5, 1996.
5.1(2) -- Opinion of Crouch & Hallett, L.L.P.
10.1(2) -- Employment Agreement of Richard K. McClelland.
10.2(2) -- Consulting Agreement of George M. Siegel.
10.3(2) -- Dynamex Inc. 1996 Stock Option Plan.
10.4(2) -- Marketing and Transportation Services Agreement, between Purolator
Courier Ltd. and Parcelway Courier Systems Canada Ltd., dated
November 20, 1995.
10.5(2) -- Form of Indemnification and Hold Harmless Agreements with Executive
Officers and Directors.
10.6(2) -- Registration Rights Agreement by and among Dynamex Inc., Cypress,
McFarland Grossman & Co. and George M. Siegel, dated November 16,
1993, as amended by that Amendment No. 1 to Registration Rights
Agreement, dated May 31, 1995.
10.7(2) -- Registration Rights Agreement, by and among Dynamex Inc., Preferred
Risk Mutual Insurance Company, Preferred Life Insurance Company and
Richard K. McClelland, dated May 31, 1995.
10.8(2) -- Amended and Restated Credit Agreement by and among the Company and
NationsBank of Texas, N.A., as agent for the lenders named therein,
dated July 5, 1996.
10.9(2) -- Subordinated Renewal Promissory Note, payable by Dynamex Inc. to Air
Canada, in the original principal amount of Cdn $3,225,000, dated
December 28, 1995.

139

EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------

10.10(2) -- Form of Junior Subordinated Debenture, payable by Dynamex Inc., dated
December 28, 1995.
10.11(2) -- Form of Dynamex Inc. Common Stock Purchase Warrant, dated December
28, 1995.
10.12(2) -- Asset Purchase Agreement by and among Dynamex Operations East, Inc.,
Dynamex Operations West, Inc., Parcelway Courier Systems Canada Ltd.,
Mayne Nickless Incorporated, Mayne Nickless Canada Inc., Mayne
Nickless Courier Systems, Inc., Mayne Nickless Messenger Services,
Inc. and Mayne Nickless Transport Inc., dated December 29, 1995.
10.13(2) -- Asset Purchase Agreement by and among Parcelway Courier Systems
Canada Ltd. and Air Canada, dated May 31, 1995.
11.1(2) -- Statement re computation of earnings per share.
21.1(2) -- Subsidiaries of the Registrant.
23.1(1) -- Independent Auditors' Consent of Deloitte & Touche.
23.2(1) -- Independent Auditors' Consent of Deloitte & Touche LLP.
23.3(1) -- Independent Auditors' Consent of Price Waterhouse.
23.4(2) -- Consent of Crouch & Hallett, L.L.P. (included in Exhibit 5.1).
23.5(2) -- Consent of Kenneth Bishop as Nominee Director of Dynamex Inc.
23.6(2) -- Consent of E. T. Whalen as Nominee Director of Dynamex Inc.
24.1(2) -- Power of Attorney (included on page II-5).

- ---------------

(1) Filed herewith

(2) Previously filed