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Oren also acted as the treasurer of the company, and Mrs. Oren
acted as vice president/secretary during 1993, 1994, and 1995.
Mr. Oren and Mrs. Oren were the only directors of HS. HS
purchased tractors which HS then leased under a “lease-to-
purchase” program. HS leased the tractors to individuals who
wanted to become owner-operators of the tractors. The
profitability of HS was dependent on its ability to purchase a
number of tractors at wholesale prices and to lease those same
tractors to individuals willing to own their own trucks and drive
them. The following table details some of the business
operations of HS for 1993, 1994, and 1995:
Item
Ordinary
Year Revenues Net Income Income Employees Tractors
1993 $8,361,000 $1,634,071 $(1,511,830)11 852
111,231
1994 11,202,000 322,689 (1,773,473)19
191,184
1995 13,798,000 1,451,609 482,405 19
HS also elected to be taxed as an S corporation for taxable years
1993, 1994, and 1995.
The various entities, Dart, Fleetline, HL, and HS, were kept
separate from one another in order to: (1) Minimize exposure to
liability by keeping as many assets as possible out of the
primary truckload carriers, Dart and Fleetline; (2) promote
accountability within each segment of the trucking business; (3)
maintain flexibility of operations; (4) permit financial results
to be reported separately; and (5) facilitate family and estate
planning.
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