O&S Trucking files for bankruptcy protection, looks to Prime
O&S stands to benefit from Prime’s “advantageous buying power” for fuel and equipment, as well as from additional business through Prime’s customer base, according to the filing. Prime would assume administrative, accounting and marketing functions, resulting in reduced overhead expense for O&S.
The Trucker Staff
SPRINGFIELD, Mo. — Refrigerated carrier O&S Trucking has filed for Chapter 11 bankruptcy protection, and has asked the court for permission to form a “business relationship” with truckload giant Prime Inc., also based here.
O&S, a 300-truck fleet according to its website, filed the petition Wednesday in U.S. Bankruptcy Court for the Western District of Missouri. The filing listed estimated liabilities of between $10 million and $50 million, and assets of less than $50,000.
The emergency motion for approval of the Prime “affiliation” was filed Thursday. The broker/carrier agreement with New Prime Inc.’s Prime Logistics calls for O&S to receive 80 percent of the freight revenue from the relationship — “critical” liquidity that would not be possible otherwise, according to court documents.
O&S also stands to benefit from Prime’s “advantageous buying power” for fuel and equipment, as well as from additional business through Prime’s customer base, according to the filing. Prime would assume administrative, accounting and marketing functions, resulting in reduced overhead expense for O&S.
“Debtor submits that the business relationship and affiliation with Prime is a crucial, indeed indispensible [sic], program for the maintenance and promotion of Debtor's business and the enhancement of its prospects for a successful reorganization,” the filing states.
As an incentive for O&S President and CEO James O’Neal “to exercise maximum efforts” in bringing customers on-board under the Prime arrangement, the deal includes a 3 percent commission on freight revenue generated by O&S in the first year, 2 percent in the second year, and 1 percent in the third year.
O’Neal told Springfield television station KY3 he was “relieved” the company had finally filed for reorganization. On May 7 he resigned abruptly as the city’s two-term mayor, citing “an extreme amount of financial and business pressure, as well as some family pressure.”
Among the 200 to 999 estimated number of creditors, the filing lists debts of $220,000 to Springfield Freightliner Sales for a maintenance contract; $211,211 to Bridgestone/Firestone; $200,000 to a Kansas City law firm for a wrongful death settlement; $196,301 to Comdata for fuel card purchases; $142,662 to Pilot Corp. for fuel; and $98,993 to Transport International Pool for trailer leases.
A hearing on emergency motions is set for June 5. A Chapter 11 meeting of creditors has been scheduled for July 18.
Kevin Jones of The Trucker staff can be reached for comment at firstname.lastname@example.org.
Find more news and analysis from The Trucker, and share your thoughts, on Facebook.