On September 30, 1994, Arkansas Best Corporation consummated the purchase of all outstanding stock of the Clipper Group pursuant to a stock purchase agreement entered into on August 18, 1994. Assets of approximately $26.2 million were acquired and liabilities of approximately $14.7 million were assumed. The Company’s total purchase price is $60.8 million in cash, subject to certain closing audit adjustments. The Company paid an initial payment of $54 million to the Clipper Group shareholders from cash on hand and funds provided under its receivables purchase agreement. The remaining $6.8 million due is included in the current portion of long-term debt in the accompanying consolidated financial statements. The final payment, which is due on May 15, 1995, will be funded from cash on hand and/or funds available under existing credit facilities.

The acquisition has been accounted for under the purchase method, effective September 30, 1994, with operations of Clipper included for the three-month period ended December 31, 1994. The purchase price has been allocated to assets and liabilities based on their estimated fair values as of the date of acquisition. Approximately $49.4 million of goodwill was recorded as a result of the purchase allocation and is being amortized over a 30-year period. A final allocation of the purchase price will be completed in 1995 based on determination of the final purchase price. The final allocation is not expected to vary materially from amounts previously recorded.

On October 12, 1994, the Company issued 310,191 shares of common stock for all of the outstanding stock of Traveller Enterprises and subsidiaries and Commercial Warehouse Company, collectively (the “Traveller Group”). The acquisition of the Traveller Group has been accounted for as a pooling of interests. The Traveller Group’s operations are not material in relation to the Company’s consolidated financial statements for any period; therefore, financial statements for periods prior to the merger have not been restated, and the financial statements include operations of the Traveller Group from the date of the combination. The final number of shares that will be issued in conjunction with this transaction are subject to certain audit closing adjustments.

Pro forma unaudited information (as if the Clipper Group and Traveller Group acquisitions were completed at the beginning of the respective periods) for 1994 and 1993 is as follows:

                                                        1994          1993   
                                                            ($ thousands)
Operating revenues                                  $ 1,209,054  $ 1,149,627
Operating expenses                                    1,152,858    1,094,340 
                                                         56,196       55,287
Interest expense, net                                     9,715       10,602
Minority interest in subsidiary                           3,523        3,140
Other expense, net                                        2,051        2,331
Provision for income taxes                               19,592       18,874 
Income before extraordinary item                    $    21,315  $    20,340 
Earnings per common share before extraordinary item         .87          .84 
Average common shares outstanding                        19,662       19,504 

The above pro forma unaudited information does not purport to be indicative of the results which actually would have occurred had the acquisitions been made at the beginning of the respective periods.

On August 29, 1993, TREADCO purchased substantially all of the assets and assumed certain liabilities of Trans-World Tire Corporation Inc., a new and retread truck tire operation. Assets of approximately $8.2 million were acquired and liabilities of approximately $6.4 million were assumed. The purchase price was approximately $2.9 million. A total of $1.1 million of goodwill was recognized in connection with the purchase. The pro forma effect of the Trans-World Tire Corporation acquisition is not material to the Company’s operations for any period.