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<SEC-DOCUMENT>0000798287-04-000020.txt : 20041110
<SEC-HEADER>0000798287-04-000020.hdr.sgml : 20041110
<ACCEPTANCE-DATETIME>20041109172504
ACCESSION NUMBER:		0000798287-04-000020
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		9
CONFORMED PERIOD OF REPORT:	20040930
FILED AS OF DATE:		20041109
DATE AS OF CHANGE:		20041109

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PAM TRANSPORTATION SERVICES INC
		CENTRAL INDEX KEY:			0000798287
		STANDARD INDUSTRIAL CLASSIFICATION:	TRUCKING (NO LOCAL) [4213]
		IRS NUMBER:				710633135
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-15057
		FILM NUMBER:		041130743

	BUSINESS ADDRESS:	
		STREET 1:		297 WEST HENRI DE TONTI BLVD
		CITY:			TONTITOWN
		STATE:			AR
		ZIP:			72770
		BUSINESS PHONE:		4793619111

	MAIL ADDRESS:	
		STREET 1:		297 WEST HENRI DE TONTI BLVD
		CITY:			TONTITOWN
		STATE:			AR
		ZIP:			72770
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>doc1.txt
<DESCRIPTION>3RD QTR 2004 10Q
<TEXT>


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q


[ X ]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

               For the quarterly period ended September 30, 2004


[ _ ]          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the transition period from ______to______

                       Commission File Number    0-15057
                                                 -------

                      P.A.M. TRANSPORTATION SERVICES, INC.
                      ------------------------------------
             (Exact name of registrant as specified in its charter)

          Delaware                                           71-0633135
          --------                                           ----------
(State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                           Identification No.)

              297 West Henri De Tonti, Tontitown, Arkansas 72770
              --------------------------------------------------
              (Address of principal executive offices)(Zip Code)

       Registrants telephone number, including area code:  (479) 361-9111

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements for the past 90 days.

Yes  [ X ]          No  [ _ ]

Indicate  by  check  mark  whether  the  registrant  is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes  [ X ]          No  [ _ ]

Indicate  the  number  of shares outstanding  of each of the issuer's classes of
common stock, as of the latest practicable date:

         Class                                   Outstanding at October 25, 2004
         -----                                   -------------------------------
Common Stock, $.01 Par Value                               11,300,207

<PAGE>



                       PART I - FINANCIAL INFORMATION

                       Item 1.  Financial Statements


<PAGE>



<TABLE>
<CAPTION>
                     P.A.M. TRANSPORTATION SERVICES, INC.
                               AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                       (in thousands, except share data)

                                                  September 30,   December 31,
                                                      2004           2003
                                                      ----           ----
                                                  (unaudited)       (note)
<S>                                               <C>             <C>
ASSETS
Current assets:
     Cash and cash equivalents                     $   9,906       $  3,064
     Receivables:
          Trade, net of allowance                     53,836         46,120
          Other                                        3,003          1,150
     Inventories                                         852            653
     Prepaid expenses and deposits                    10,236          6,771
     Marketable equity securities,
      available for sale, at fair value                5,851          5,492
     Income taxes refundable                             997          1,256
                                                   ---------      ---------
          Total current assets                        84,681         64,506

Property and equipment, at cost                      256,048        269,419
     Less: accumulated depreciation                  (84,039)       (86,689)
                                                   ---------      ---------
          Net property and equipment                 172,009        182,730

Other assets:
     Goodwill                                         15,413         15,413
     Non compete agreement                               742          1,004
     Other                                             1,245          1,196
                                                   ---------      ---------
          Total other assets                          17,400         17,613
                                                   ---------      ---------
Total assets                                       $ 274,090      $ 264,849
                                                   =========      =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Current maturities of long-term debt          $   3,439      $   2,039
     Trade accounts payable                           19,038         22,295
     Other current liabilities                        10,787         11,167
     Deferred income taxes                             3,231          1,330
                                                   ---------      ---------
          Total current liabilities                   36,495         36,831

Long-term debt, less current portion                  23,184         26,740
Non compete agreement                                    434            695
Deferred income taxes                                 47,819         43,708
Shareholders' equity:
Preferred Stock, $.01 par value:
     10,000,000 shares authorized; none issued
Common stock, $.01 par value:
     40,000,000 shares authorized; issued and
     outstanding-11,300,207 at September 30, 2004,
     11,294,207 at December 31, 2003                     113            113
Additional paid-in capital                            76,010         75,957
Accumulated other comprehensive income                   568            164
Retained earnings                                     89,467         80,641
                                                   ---------      ---------
Total shareholders' equity                           166,158        156,875
                                                   ---------      ---------
Total liabilities and shareholders' equity         $ 274,090      $ 264,849
                                                   =========      =========

Note:  The  balance sheet at December 31, 2003 has been derived from the audited
financial  statements  at  that date but does not include all of the information
and  footnotes required by generally accepted accounting principles for complete
financial statements.  See notes to condensed consolidated financial statements.

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                   P.A.M. TRANSPORTATION SERVICES, INC.
                                            AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                              (unaudited)
                                   (in thousands, except share data)


                                                     Three Months Ended             Nine Months Ended
                                                       September 30,                  September 30,
                                                    2004           2003            2004           2003
                                                    ----           ----            ----           ----
<S>                                             <C>            <C>             <C>            <C>
Revenue:
  Operating revenue, before fuel surcharge      $   75,222     $   74,216      $  231,966     $  219,311
  Fuel surcharge                                     3,857          1,299           9,518          5,783
                                                 ---------      ---------       ---------      ---------
                                                    79,079         75,515         241,484        225,094
                                                 ---------      ---------       ---------      ---------
Operating expenses:
  Salaries, wages and benefits                      28,060         30,161          88,098         89,368
  Operating supplies                                19,030         15,586          55,995         46,941
  Rent and purchased transportation                  9,505          9,276          29,277         25,867
  Depreciation and amortization                      7,649          6,590          22,534         19,194
  Operating taxes and licenses                       3,708          3,686          11,664         10,890
  Insurance and claims                               3,848          3,089          11,741         10,220
  Communications and utilities                         639            624           2,005          1,861
  Other                                                745          1,172           3,649          3,381
  Loss on sale of equipment                            306             14             584             42
                                                 ---------      ---------       ---------      ---------
                                                    73,490         70,198         225,547        207,764
                                                 ---------      ---------       ---------      ---------
Operating income                                     5,589          5,317          15,937         17,330
Other income (expense)
  Interest expense                                    (305)          (375)         (1,004)        (1,060)
                                                 ---------      ---------       ---------      ---------
Income before income taxes                           5,284          4,942          14,933         16,270

Income taxes --current                                (257)            60             378            270
             --deferred                              2,393          1,917           5,729          6,172
                                                 ---------      ---------       ---------      ---------
                                                     2,136          1,977           6,107          6,442
                                                 ---------      ---------       ---------      ---------
Net income                                       $   3,148      $   2,965       $   8,826      $   9,828
                                                 =========      =========       =========      =========
Net income per common share:
  Basic                                          $    0.28      $    0.26       $    0.78      $    0.87
                                                 =========      =========       =========      =========
  Diluted                                        $    0.28      $    0.26       $    0.78      $    0.87
                                                 =========      =========       =========      =========

Average common shares outstanding-Basic         11,298,055     11,293,147      11,296,411     11,289,927
                                                ==========     ==========      ==========     ==========
Average common shares outstanding-Diluted       11,324,094     11,326,610      11,322,508     11,330,528
                                                ==========     ==========      ==========     ==========

                       See notes to condensed consolidated financial statements.
</TABLE>
<PAGE>


<TABLE>
<CAPTION>
                       P.A.M. TRANSPORTATION SERVICES, INC.
                                 AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    (unaudited)
                                  (in thousands)

                                                                  Nine Months Ended
                                                                     September 30,
                                                                  2004          2003
                                                                  ----          ----
<S>                                                          <C>           <C>
OPERATING ACTIVITIES
Net income                                                   $   8,826     $   9,828
  Adjustments to reconcile net income to net cash
  provided by operating activities:
     Depreciation and amortization                              22,534        19,194
     Non compete agreement amortization                              -            42
     Provision for deferred income taxes                         5,729         6,172
     Loss on retirement of property and equipment                  584            42
     Changes in operating assets and liabilities:
          Accounts receivable                                   (9,613)      (18,209)
          Prepaid expenses and other current assets             (3,456)       (3,387)
          Accounts payable                                      (2,067)        2,752
          Reserve for lawsuit                                     (635)            -
          Other current liabilities                               (380)        2,113
                                                             ---------     ---------
Net cash provided by operating activities                       21,522        18,547

INVESTING ACTIVITIES
Purchases of property and equipment                            (35,691)      (42,065)
Acquisition of businesses, net of cash acquired                      -       (10,752)
Purchases of marketable securities                                (225)       (3,946)
Proceeds from sales of assets                                   23,296        14,036
Lease payments received on direct financing leases                  44            31
                                                             ---------     ---------
Net cash used in investing activities                          (12,576)      (42,696)

FINANCING ACTIVITIES
Borrowings under lines of credit                               259,313       257,783
Repayments under lines of credit                              (262,182)     (257,783)
Borrowings of long-term debt                                     4,380             -
Repayments of long-term debt                                    (3,669)       (1,198)
Proceeds from exercise of stock options                             54           115
                                                             ---------     ---------
Net cash used in financing activities                           (2,104)       (1,083)
                                                             ---------     ---------
Net increase (decrease) in cash and cash equivalents             6,842       (25,232)

Cash and cash equivalents at beginning of period                 3,064        30,766
                                                             ---------     ---------
Cash and cash equivalents at end of period                   $   9,906     $   5,534
                                                             =========     =========
          See notes to condensed consolidated financial statements.

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
P.A.M. TRANSPORTATION SERVICES, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(unaudited)
(in thousands)

- ----------------------------------------------------------------------------------------------------------------------------------
                                                                                              Accumulated
                                                                Additional       Total          Other
                                               Common Stock       Paid-In    Comprehensive   Comprehensive    Retained
                                             Shares     Amount    Capital        Income      Income/(Loss)    Earnings      Total
- ----------------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>         <C>      <C>         <C>             <C>              <C>         <C>
BALANCE AT DECEMBER 31, 2003                 11,294        113     75,957                          164          80,641     156,875

  Components of comprehensive income:
    Net income                                                                  $  8,826                         8,826       8,826
    Other comprehensive income (loss) -
      Unrealized gain on hedge,
       net of tax of $226                                                            339           339                         339
      Unrealized gain on marketable
       securities, net of tax of $43                                                  65            65                          65
                                                                                --------
    Total comprehensive income                                                  $  9,230
                                                                                ========
    Exercise of stock options-
    shares issued including tax
    benefits                                      6                    53                                                       53
- ----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT SEPTEMBER 30, 2004                11,300     $  113   $ 76,010                     $    568        $ 89,467    $166,158
==================================================================================================================================

See notes to condensed consolidated financial statements.

</TABLE>
<PAGE>




                       P.A.M. TRANSPORTATION SERVICES, INC.
                                AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                               SEPTEMBER 30, 2004

NOTE A:  BASIS  OF  PRESENTATION
- --------------------------------
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information  and with the instructions to Form 10-Q and Article 10 of
Regulation  S-X.  Accordingly,  they  do  not include all of the information and
footnotes  required  by  generally  accepted  accounting principles for complete
financial  statements.  In  management's opinion, all adjustments (consisting of
normal recurring accruals) necessary for a fair presentation have been included.
Operating  results  for  the  nine-month period ended September 30, 2004 are not
necessarily  indicative  of the results that may be expected for the year ending
December  31, 2004. For further information, refer to the consolidated financial
statements  and the footnotes thereto included in the Company's annual report on
Form 10-K for the year ended December 31, 2003.

In  order  to  conform  to industry practice, the Company began to classify fuel
surcharges  charged  to  customers  as  revenue  rather  than  as a reduction of
operating  supplies  expense  as  presented in reports prior to the period ended
June  30, 2004. This reclassification has no effect on net operating income, net
income  or  earnings  per  share.  The  Company  has  made  corresponding
reclassifications to comparative periods shown.


NOTE B:  DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
- ----------------------------------------------------------------
Effective  February  28,  2001  the  Company  entered into an interest rate swap
agreement on a notional amount of $15,000,000. The pay fixed rate under the swap
is 5.08%, while the receive floating rate is "1-month" LIBOR. This interest rate
swap  agreement  terminates on March 2, 2006. Effective May 31, 2001 the Company
entered into an interest rate swap agreement on a notional amount of $5,000,000.
The  pay  fixed rate under the swap is 4.83%, while the receive floating rate is
"1-month"  LIBOR.  This interest rate swap agreement terminates on June 2, 2006.

The  Company designates both of these interest rate swaps as cash flow hedges of
its  exposure  to  variability  in  future  cash  flows  resulting from interest
payments  indexed  to  "1-month"  LIBOR.  Changes  in future cash flows from the
interest  rate  swaps will offset changes in interest rate payments on the first
$20,000,000  of  the  Company's  current  revolving  credit  facility  or future
"1-month"  LIBOR  based  borrowings  that  reset on the last London Business Day
prior  to  the  start  of the next interest period. The hedge locks the interest
rate  at  5.08%  or  4.83%  plus  the  pricing  spread (currently 1.15%) for the
notional amounts of $15,000,000 and $5,000,000, respectively.

These interest rate swap agreements meet the specific hedge accounting criteria.
The  effective  portion  of  the  cumulative gain or loss has been reported as a
component  of  accumulated  other comprehensive loss in shareholders' equity and
will  be  reclassified  into  current  earnings  by  June  2,  2006,  the latest
termination  date  for  all  current  swap  agreements.  The Company records all
derivatives at fair value as assets or liabilities in the condensed consolidated
balance  sheet,  with  classification  as  current or long-term depending on the
duration  of  the  instrument. For the nine months ended September 30, 2004, the
Company  had  a  net  unrealized gain of approximately $339,000, net of deferred
income taxes.  At September 30, 2004, the net after tax deferred hedging loss in
accumulated other comprehensive loss was approximately $443,000.

The  measurement  of  hedge  effectiveness  is  based  upon  a comparison of the
floating-rate  leg  of  the  swap and the hedged floating-rate cash flows on the
underlying  liability.  This  method  is  based  upon  the premise that only the
floating-rate  component  of  the  swap  provides  the  cash flow hedge, and any
changes  in  the  swap's  fair  value  attributable to the fixed-rate leg is not
relevant to the variability of the hedged interest payments on the floating-rate
liability.  The  calculation  of  ineffectiveness  involves  a comparison of the
present  value of the cumulative change in the expected future cash flows on the
variable  leg  of the swap and the present value of the cumulative change in the
expected  future  interest  cash  flows  on  the  floating-rate  liability.
Ineffectiveness related to these hedges was not significant.

In  August  2000  and  July  2001,  we  entered  into agreements to obtain price
protection  and  reduce  a  portion  of our exposure to fuel price fluctuations.
Under  these agreements, we were obligated to purchase minimum amounts of diesel
fuel  per  month,  with  a price protection component, for the six month periods
ended  March 31, 2001 and February 28, 2002. The agreements also provide that if
during the 48 months commencing April 2001, the average monthly price of heating
oil  on  the  New  York  Mercantile  Exchange  ("NY MX HO") falls below $.58 per
gallon,  we  are  obligated  to  pay,  for  a maximum of twelve different months
selected  by  the  contract  holder  during such 48-month period, the difference
between  $.58  per  gallon  and  NY  MX  HO average price, multiplied by 900,000
gallons.  Accordingly, in any month in which the holder exercises such right, we
would  be obligated to pay the holder $9,000 for each cent by which $.58 exceeds
the  average  NY  MX  HO  price  for that month. The estimated fair value of the
agreements  are periodically adjusted and as of September 30, 2004 the estimated
fair  value  of  $625,000 is included in accrued liabilities in the accompanying
condensed consolidated financial statements. For the three and nine month period
ended September 30, 2004 an adjustment of $125,000 was made which had the effect
of  reducing  operating  supplies  expense and other current liabilities each by
$125,000 in the accompanying condensed consolidated financial statements.


NOTE C:  RECENT ACCOUNTING PRONOUNCEMENTS
- -----------------------------------------
In December 2003, the FASB issued Interpretation No. 46 (revised December 2003),
Consolidation  of  Variable  Interest  Entities, an interpretation of Accounting
Research  Bulletin  No. 51, Consolidated Financial Statements ("FIN 46R"), which
replaced  FIN  46.  FIN  46  clarifies  the  application  of Accounting Research
Bulletin  No.  51  to certain entities in which equity investors do not have the
characteristics  of  a  controlling financial interest or do not have sufficient
equity  at  risk  for  the  entity  to finance its activities without additional
subordinated  financial support. The Company is required to adopt the provisions
of  FIN 46R by the beginning of the first annual period beginning after December
15,  2004.  The adoption of FIN 46R is not expected to have a material effect on
the Company's consolidated financial statements.

In  March 2004, the FASB issued an exposure draft entitled Share-Based Payment -
an  amendment  of  Statements  No. 123  and  95 (Proposed Statement of Financial
Accounting  Standards).  The  proposed  Statement would eliminate the ability to
account  for  share-based compensation transactions using APB Opinion No. 25 and
generally  require  instead  that  such  transactions  be  accounted for using a
fair-value-based  method.  This  accounting,  if  approved,  could  result  in
significant  compensation  expense  charges to our future results of operations.
The  exposure draft, if adopted as presently drafted, would be applied to public
entities prospectively for fiscal years beginning after December 15, 2004, as if
all share-based compensation awards granted, modified, or settled after December
15,  1994,  had  been  accounted  for using the fair-value method of accounting.
Retrospective application of the proposed Statement is not permitted.

Management  of  the  Company  is  considering the impact of EITF Issue 03-1, The
Meaning  of  Other-Than-Temporary  Impairment  and  Its  Application  to Certain
Investments  ("EITF 03-1"). The EITF has concluded that EITF 03-1 indicates that
an  investor  must  have  the  intent  and ability to hold an investment until a
forecasted recovery of the fair value up to or beyond the cost of the investment
in order to determine that any impairment is temporary. If the investor does not
have  the intent and ability to hold the investment until a forecasted recovery,
then  an  other-than-temporary impairment must be recorded. The consensus by the
EITF  is effective for periods beginning after June 15, 2004, however FASB Staff
Position  (FSP) EITF Issue 3-1-1 has delayed the effective date of paragraphs 10
through  20  until implementation guidance within proposed FSP EITF Issue 03-1-a
has  been  finalized.  Management has determined that the impact of EITF 03-1 is
not  material  at September 30, 2004, but is continuing to evaluate the possible
future impact on the Company's financial position and results of operations.


NOTE D:  MARKETABLE SECURITIES
- ------------------------------
The  Company's  investments  in  marketable  securities, which are classified as
available  for  sale,  currently  consist  entirely  of equity securities. These
equity  securities have a combined original cost of approximately $4,140,000 and
a  combined  fair  market  value of approximately $5,851,000 as of September 30,
2004.  Unrealized  gains  and  losses  from  marketable securities classified as
available  for  sale  are  recorded  as  a  component  of  accumulated  other
comprehensive  income  in  shareholders' equity. For the nine month period ended
September  30,  2004  the  Company  had a net unrealized gain in market value of
$65,000,  net  of  deferred  income  taxes.  At  September  30,  2004  the total
unrealized  gain,  net  of  deferred  income  taxes,  in  accumulated  other
comprehensive  income was approximately $1,011,000. During the first nine months
of 2004 there were no sales or reclassifications of marketable securities.


NOTE E:  STOCK BASED COMPENSATION
- ---------------------------------
The  Company  adopted  the  disclosure-only provisions of Statement of Financial
Accounting  Standards No. 123, Accounting for Stock-Based Compensation (SFAS No.
123).  The following table illustrates the effect on net income and earnings per
share  if  the Company had applied the fair value recognition provisions of SFAS
No. 123 to stock-based employee compensation:
<TABLE>
<CAPTION>
                                                          Three Months Ended             Nine Months Ended
                                                             September 30,                 September 30,
                                                         2004           2003           2004           2003
                                                        -------        -------        -------        -------
                                                                (in thousands, except per share data)
<S>                                                     <C>            <C>            <C>            <C>
Net income                                              $ 3,148        $ 2,965        $ 8,826        $ 9,828

Total stock-based employee compensation
 expense determined under fair value based
 method for all awards, net of related tax effects          (74)           (82)          (222)          (245)
                                                        -------        -------        -------        -------
Pro forma net income                                    $ 3,074        $ 2,883        $ 8,604        $ 9,583
                                                        =======        =======        =======        =======
Earnings per share:
  Basic - as reported                                   $   .28        $   .26        $   .78        $   .87
  Basic - pro forma                                     $   .27        $   .26        $   .76        $   .85

  Diluted - as reported                                 $   .28        $   .26        $   .78        $   .87
  Diluted - pro forma                                   $   .27        $   .25        $   .76        $   .85
</TABLE>


NOTE F:  BUSINESS ACQUISITIONS
- ------------------------------
On January 31, 2003, P.A.M. Transportation Services, Inc. acquired substantially
all  of  the  assets  of  East  Coast  Transport, Inc. The results of East Coast
Transport,  Inc.  have  been  included  in the consolidated financial statements
since  that  date. In accordance with SFAS No. 141, "Business Combinations", the
acquisition  was  accounted  for  under  the  purchase method of accounting. The
Company  paid  cash  of  approximately  $1.9  million, entered into a seven year
installment  note in the amount of approximately $5.0 at an interest rate of 6%,
and  entered into a non-compete agreement requiring payment of $1.0 million over
a  five  year  period.  Goodwill  resulting  from  the  transaction  totaled
approximately $6.9 million.

On  April  3,  2003, P.A.M. Transportation Services, Inc. acquired substantially
all  of  the  assets  of McNeill Trucking, Inc. The results of McNeill Trucking,
Inc.  have  been  included  in  the consolidated financial statements since that
date.  In accordance with SFAS No. 141, "Business Combinations", the acquisition
was accounted for under the purchase method of accounting. The Company paid cash
of  approximately $8.8 million and assumed liabilities of approximately $70,000,
and  entered  into  a non-compete agreement requiring payment of $300,000 over a
two  year  period. Goodwill resulting from the transaction totaled approximately
$370,000.


<PAGE>

                         PART I - FINANCIAL INFORMATION

           Item 2.  Management's Discussion and Analysis of Financial
                       Condition and Results of Operations

<PAGE>


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


FORWARD-LOOKING INFORMATION
- ----------------------------
Certain  information  included in this Quarterly Report on Form 10-Q constitutes
"forward-looking  statements"  within  the  meaning  of  the  Private Securities
Litigation  Reform  Act  of  1995. Such forward-looking statements may relate to
expected  future  financial  and  operating  results  or  events,  and  are thus
prospective. Such forward-looking statements are subject to risks, uncertainties
and  other  factors  which  could cause actual results to differ materially from
future  results  expressed  or  implied  by  such  forward-looking  statements.
Potential  risks  and  uncertainties  include,  but  are  not limited to, excess
capacity  in  the  trucking industry; surplus inventories; recessionary economic
cycles  and  downturns  in  customers'  business  cycles;  increases  or  rapid
fluctuations  in  fuel  prices,  interest  rates, fuel taxes, tolls, license and
registration  fees;  the  resale  value  of the Company's used equipment and the
price  of  new  equipment;  increases  in  compensation  for  and  difficulty in
attracting  and  retaining  qualified  drivers and owner-operators; increases in
insurance  premiums and deductible amounts relating to accident, cargo, workers'
compensation, health, and other claims; unanticipated increases in the number or
amount of claims for which the Company is self insured; inability of the Company
to  continue  to secure acceptable financing arrangements; seasonal factors such
as  harsh  weather  conditions  that  increase operating costs; competition from
trucking,  rail,  and  intermodal  competitors  including  reductions  in  rates
resulting  from  competitive  bidding;  the  ability  to  identify  acceptable
acquisition  candidates,  consummate  acquisitions,  and  integrate  acquired
operations;  a significant reduction in or termination of the Company's trucking
service  by  a key customer; and other factors, including risk factors, referred
to  from  time  to  time  in filings made by the Company with the Securities and
Exchange  Commission.  The Company undertakes no obligation to update or clarify
forward-looking  statements,  whether  as  a  result  of new information, future
events or otherwise.


CRITICAL ACCOUNTING POLICIES
- ----------------------------
The  Company's  management  makes  estimates  and  assumptions  in preparing the
consolidated  financial  statements that affect reported amounts and disclosures
therein.  In  the  opinion of management, the accounting policies that generally
have  the  most  significant  impact  on  the  financial position and results of
operations of the Company include:

Accounts  Receivable.  We  continuously  monitor collections from our customers,
third  parties  and vendors and maintain a provision for estimated credit losses
based  upon our historical experience and any specific collection issues that we
have  identified.  While  such  credit  losses have historically been within our
expectations  and  the  provisions established, we cannot guarantee that we will
continue  to  experience  the  same  credit loss rates that we have in the past.

Property  and  equipment.  Management  must use its judgment in the selection of
estimated  useful lives and salvage values for purposes of depreciating tractors
and  trailers  which  in  some  cases  do  not  have guaranteed residual values.
Estimates of salvage value at the expected date of trade-in or sale are based on
the  expected  market values of equipment at the time of disposal which, in many
cases include guaranteed residual values by the manufacturers.

Self Insurance. The Company is self-insured for health and workers' compensation
benefits  up  to certain stop-loss limits. Such costs are accrued based on known
claims  and an estimate of incurred, but not reported (IBNR) claims. IBNR claims
are estimated using historical lag information and other data either provided by
outside  claims  administrators or developed internally. This estimation process
is subjective, and to the extent that future actual results differ from original
estimates, adjustments to recorded accruals may be necessary.

Revenue  Recognition.  Revenue is recognized in full upon completion of delivery
to  the  receiver's  location.  For freight in transit at the end of a reporting
period,  the  Company recognizes revenue prorata based on relative transit miles
completed  as  a  portion  of  the  estimated total transit miles with estimated
expenses recognized upon recognition of the related revenue.

Prepaid  Tires. Tires purchased with revenue equipment are capitalized as a cost
of the related equipment. Replacement tires are included in prepaid expenses and
deposits  and  are  amortized  over  a  24-month  period.  Costs related to tire
recapping are expensed when incurred.

Business  Segment and Concentrations of Credit Risk. The Company operates in one
business  segment, motor carrier operations. The Company provides transportation
services  to  customers  throughout the United States and portions of Canada and
Mexico.  The  Company performs ongoing credit evaluations and generally does not
require  collateral  from  its  customers.  The  Company  maintains reserves for
potential  credit losses. In view of the concentration of the Company's revenues
and  accounts  receivable  among  a  limited  number  of  customers  within  the
automobile  industry,  the  financial health of this industry is a factor in the
Company's  overall evaluation of accounts receivable. At September 30, 2004, one
customer's  accounts receivable balance represented 59.8% of the Company's total
accounts receivable.

Business  Combinations  and Goodwill. Upon acquisition of an entity, the cost of
the  acquired  entity  must  be  allocated  to  assets and liabilities acquired.
Identification  of  intangible  assets,  if  any,  that meet certain recognition
criteria  is  necessary.  This  identification and subsequent valuation requires
significant judgments.  The carrying value of goodwill was tested for impairment
on  September 30, 2004. The impairment testing requires an estimate of the value
of  the  Company  as  a  whole,  as  the  Company has determined it only has one
reporting unit as defined in SFAS No. 142.


BUSINESS OVERVIEW
- -----------------
The  Company's  administrative  headquarters  are  in  Tontitown,  AR. From this
location  we  manage operations conducted through nine wholly owned subsidiaries
based  in  various locations around the United States and Canada. The operations
of these subsidiaries can generally be classified into either truckload services
or  brokerage  and  logistics  services.  Truckload  services  include  those
transportation  services  in  which  we  utilize  company  owned  tractors  or
owner-operator  owned  tractors.  Both  our  truckload  operations  and  our
brokerage/logistics  operations  have  similar  economic characteristics and are
impacted  by  virtually the same economic factors as discussed elsewhere herein.
All  of the Company's operations are in the trucking and transportation segment.

For  both  operations  substantially  all  of  our  revenue  is  generated  by
transporting  freight  for customers. For the three and nine month periods ended
September  30,  2004  truckload revenues, excluding fuel surcharges, represented
approximately  86%  of total revenues, excluding fuel surcharges, with remaining
revenues  being generated by our brokerage and logistics services. For the three
and  nine  month  periods ended September 30, 2003 truckload revenues, excluding
fuel  surcharges,  represented  approximately  86%  and  87%  of total revenues,
excluding fuel charges, respectively, with remaining revenues being generated by
our  brokerage  and logistics services. Our revenue is predominantly affected by
the  rates  per mile received from our customers, equipment utilization, and our
percentage of non-compensated miles. These aspects of our business are carefully
managed and efforts are continuously underway to achieve favorable results.

The  main  factors  that  impact our profitability on the expense side are costs
incurred  in  transporting  freight  for  our  customers.  Currently  our  most
challenging  costs  include fuel, driver recruitment, training, wage and benefit
costs,  independent  broker costs (which we record as purchased transportation),
insurance, and maintenance and capital equipment costs.

RESULTS OF OPERATIONS - TRUCKLOAD SERVICES DIVISION
- ---------------------------------------------------
The  following  table  sets  forth,  for  the  truckload  services division, the
percentage  relationship  of  expense  items  to operating revenues, before fuel
surcharges,  for  the  periods  indicated.  Operating  supplies  expense,  which
includes fuel costs, are shown net of fuel surcharges.
<TABLE>
<CAPTION>
                                               Three Months Ended     Nine Months Ended
                                                   September 30,         September 30,
                                                  2004      2003        2004      2003
                                                  ----      ----        ----      ----
<S>                                             <C>       <C>         <C>       <C>
Operating revenues, before fuel surcharge        100.0%    100.0%      100.0%    100.0%
                                                 ------    ------      ------    ------
Operating expenses:
  Salaries, wages and benefits                    42.4      46.5        43.1      46.3
  Operating supplies (1)                          23.6      22.5        23.4      21.6
  Rent and purchased transportation                0.5       0.2         0.5       0.2
  Depreciation and amortization                   11.7      10.3        11.2      10.1
  Operating taxes and licenses                     5.7       5.7         5.8       5.7
  Insurance and claims                             5.9       4.8         5.9       5.4
  Communications and utilities                     0.9       0.9         0.9       0.9
  Other                                            0.9       1.6         1.6       1.5
  Loss on sale or disposal of property             0.5       0.0         0.3       0.0
                                                ------    ------      ------    ------
Total operating expenses                          92.1      92.5        92.7      91.7
                                                ------    ------      ------    ------
Operating income                                   7.9       7.5         7.3       8.3
Interest expense                                  (0.4)     (0.5)       (0.4)     (0.4)
                                                ------    ------      ------    ------
Income before income taxes                         7.5       7.0         6.9       7.9
                                                ------    ------      ------    ------
- -----------------------------
(1) Net of fuel surcharges.
</TABLE>


THREE MONTHS ENDED SEPTEMBER 30, 2004 VS. THREE MONTHS ENDED SEPTEMBER 30, 2003

For  the  quarter  ended September 30, 2004, truckload services revenues, before
fuel  surcharges,  increased  1.6% to $64.9 million as compared to $63.9 million
for  the  quarter  ended  September  30,  2003.  The  increase was due to a 7.5%
increase  in the average rate per total mile from $1.07 during the third quarter
of  2003  to  $1.15  during  the  third  quarter  of  2004.  The  revenue growth
attributable  to the increase in average rate per mile was partially offset by a
5.7%  reduction in average miles per tractor per work day.

Salaries,  wages  and  benefits  decreased  from  46.5% of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003 to 42.4% of revenues, before fuel
surcharges,  in the third quarter of 2004. The decrease relates primarily to the
effect  of  a  higher  average  rate  per  mile  charged  to customers without a
corresponding increase in salaries and wages. However, effective October 1, 2004
a  new driver pay package has been implemented and the Company expects salaries,
wages  and  benefits  to  increase approximately $.03 per mile as a result. Also
contributing  to  the decrease was the continued benefit of the restructuring of
workers  compensation plans which resulted in a decrease in amounts expensed for
workers  compensation coverage. Although to a lesser extent, salaries, wages and
benefits also decreased due to a decrease in driver lease expense as the average
number of owner operators under contract decreased from 112 in the third quarter
of  2003 to 92 in the third quarter of 2004. The decrease associated with driver
lease  expense  was  partially  offset  by  an  increase  in amounts paid to the
corresponding  company  driver replacement, and in other costs normally absorbed
by the owner operator such as repairs and fuel.

Operating  supplies  and  expenses increased from 22.5% of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003 to 23.6% of revenues, before fuel
surcharges  in the third quarter of 2004. The increase relates to an increase in
fuel  costs resulting from a 30.8% increase in the average price per gallon paid
by the Company during the third quarter of 2004 as compared to the third quarter
of  2003.  During  periods  of  rising  fuel prices the Company is often able to
recoup  at  least a portion of the increase through fuel surcharges passed along
to its customers. Fuel costs, net of fuel surcharges, increased to $10.0 million
in the third quarter of 2004 from $9.0 million in the third quarter of 2003. The
Company collected approximately $3.7 million in fuel surcharges during the third
quarter  of  2004  and $1.2 million during the third quarter of 2003. Fuel costs
were also affected by the replacement of owner operators with company drivers as
discussed above.

Rent  and  purchased transportation increased from 0.2% of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003 to 0.5% of revenues, before fuel
surcharges  in  the  third  quarter  of 2004. The increase relates primarily to
rental and mileage fees incurred on equipment used past scheduled trade-in dates
due to manufacturers delays in providing replacement equipment.

Depreciation  and  amortization  increased  from  10.3% of revenues, before fuel
surcharges,  in  the  third  quarter  of 2003 to 11.7% of revenues, before fuel
surcharges, in the third quarter of 2004. The increase was primarily due to the
combined  effect  of higher tractor purchase prices and lower tractor guaranteed
residual values offered by the manufacturers.

Insurance  and  claims  expense  increased  from  4.8%  of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003  to 5.9% of revenues, before fuel
surcharges, in the third quarter of 2004. The increase in expense relates to the
purchase of additional auto liability coverage which was not in place during the
third  quarter  of  2003  and to an increase in the amount of auto liability and
cargo claims incurred by the Company.

Other  expenses  decreased from 1.6% of revenues, before fuel surcharges, in the
third  quarter of 2003 to 0.9% of revenues, before fuel surcharges, in the third
quarter  of  2004.  The decrease relates to the settlement of a lawsuit in which
the  Company  settled  with  the  payment of approximately $25,000. The original
estimate  of  approximately $660,000 had been expensed in a prior period and was
recaptured  during the current quarter as a decrease in other expenses and had a
positive  impact  of  $.03  on  both  diluted and basic earnings per share. This
decrease  was  partially offset by an increase in driver recruitment advertising
and fees paid to the Company's external auditors.

The  truckload  services  division  operating ratio, which measures the ratio of
operating  expenses,  net of fuel surcharges, to operating revenues, before fuel
surcharges, decreased  to 92.1% for the third quarter of 2004 from 92.5% for the
third quarter of 2003.


NINE MONTHS ENDED SEPTEMBER 30, 2004 VS. NINE MONTHS ENDED SEPTEMBER 30, 2003

For  the  nine  months  ended  September  30, 2004, truckload services revenues,
before  fuel  surcharges, increased 5.2% to $200.3 million as compared to $190.3
million for the nine months ended September 30, 2003. Approximately $3.6 million
of  the  $10.0  million  increase was attributable to the McNeill Trucking, Inc.
asset  acquisition which closed on April 3, 2003 and therefore had no comparable
revenue for the first three months of 2003. The remaining increase was due to an
increase  in  the  average  rate per total mile from $1.08 during the first nine
months of 2003 to $1.12 during the first nine months of 2004.

Salaries,  wages  and  benefits  decreased  from  46.3% of revenues, before fuel
surcharges,  in  the first nine months of 2003 to 43.1% of revenues, before fuel
surcharges,  in the first nine months of 2004. The decrease relates primarily to
the  effect  of  a  higher  average rate per mile charged to customers without a
corresponding increase in salaries and wages. However, effective October 1, 2004
a  new driver pay package has been implemented and the Company expects salaries,
wages  and  benefits  to  increase approximately $.03 per mile as a result. Also
contributing  to  the decrease was the continued benefit of the restructuring of
workers  compensation plans which resulted in a decrease in amounts expensed for
workers  compensation coverage. Although to a lesser extent, salaries, wages and
benefits also decreased due to a decrease in driver lease expense as the average
number  of  owner  operators under contract decreased from 122 in the first nine
months  of  2003 to 95 in the first nine months of 2004. The decrease associated
with driver lease expense was partially offset by an increase in amounts paid to
the  corresponding  company  driver  replacement,  and  in  other costs normally
absorbed by the owner operator such as repairs and fuel.

Operating  supplies  and  expenses increased from 21.6% of revenues, before fuel
surcharges,  in  the first nine months of 2003 to 23.4% of revenues, before fuel
surcharges,  in  the  first  nine  months  of  2004.  The primary reason for the
increase relates to an increase in fuel costs resulting from a 14.9% increase in
the average price per gallon paid by the Company during the first nine months of
2004 as compared to the first nine months of 2003. During periods of rising fuel
prices  the  Company  is often able to recoup at least a portion of the increase
through  fuel  surcharges passed along to its customers. Fuel costs, net of fuel
surcharges,  increased  to  $30.6  million in the first nine months of 2004 from
$26.2  million  in  the  first  nine  months  of  2003.  The  Company  collected
approximately  $9.1  million  in fuel surcharges during the first nine months of
2004 and $5.7 million during the first nine months of 2003. Fuel costs were also
affected by the replacement of owner operators with company drivers as discussed
above.

Rent  and  purchased transportation increased from 0.2% of revenues, before fuel
surcharges,  in  the  first nine months of 2003 to 0.5% of revenues, before fuel
surcharges,  in the first nine months of 2004. The increase relates primarily to
rental and mileage fees incurred on equipment used past scheduled trade-in dates
due to manufacturers delays in providing replacement equipment.

Depreciation  and  amortization  increased  from  10.1% of revenues, before fuel
surcharges,  in  the first nine months of 2003 to 11.2% of revenues, before fuel
surcharges,  in the first nine months of 2004. The increase was primarily due to
the  combined  effect  of  higher  tractor  purchase  prices  and  lower tractor
guaranteed residual values offered by the manufacturers.

Insurance  and  claims  expense  increased  from  5.4%  of revenues, before fuel
surcharges,  in  the  first nine months of 2003 to 5.9% of revenues, before fuel
surcharges, in the first nine months of 2004. The increase in expense relates to
the purchase of additional auto liability coverage which was not in place during
the first nine months of 2003 and to an increase in the amount of auto liability
claims incurred by the Company.

Other  expenses  increased from 1.5% of revenues, before fuel surcharges, in the
first  nine  months  of 2003 to 1.6% of revenues, before fuel surcharges, in the
first  nine  months of 2004. The increase relates to an increase in amounts paid
for  both driver recruitment advertising and fees paid to the Company's external
auditors which was partially offset by the settlement of a lawsuit which allowed
the  Company to recapture approximately $660,000 of previously reported expense.
The  recapture contributed approximately $.03 to both diluted and basic earnings
per share.

The  truckload  services  division  operating ratio, which measures the ratio of
operating  expenses,  net of fuel surcharges, to operating revenues, before fuel
surcharges,  increased to 92.7% for the first nine months of 2004 from 91.7% for
the first nine months of 2003.


RESULTS OF OPERATIONS - LOGISTICS AND BROKERAGE SERVICES DIVISION
- -----------------------------------------------------------------
The  following  table  sets  forth,  for  the  logistics  and brokerage services
division,  the  percentage  relationship of expense items to operating revenues,
before  fuel surcharges, for the periods indicated. Brokerage service operations
occur  specifically  in  certain  divisions; however, brokerage operations occur
throughout  the  Company  in  similar  operations  having  substantially similar
economic  characteristics.  Rent  and  purchased  transportation, which includes
costs paid to third party carriers, are shown net of fuel surcharges.
<TABLE>
<CAPTION>
                                               Three Months Ended     Nine Months Ended
                                                   September 30,         September 30,
                                                  2004      2003        2004      2003
                                                  ----      ----        ----      ----
<S>                                             <C>       <C>         <C>       <C>
Operating revenues                               100.0%    100.0%      100.0%    100.0%
                                                 ------    ------      ------    ------
Operating expenses:
  Salaries, wages and benefits                     5.6       4.4         5.4       4.3
  Operating supplies                               0.0       0.0         0.0       0.0
  Rent and purchased transportation (1)           87.4      88.2        87.8      88.0
  Depreciation and amortization                    0.3       0.0         0.3       0.0
  Operating taxes and licenses                     0.0       0.0         0.0       0.0
  Insurance and claims                             0.1       0.1         0.1       0.1
  Communications and utilities                     0.4       0.4         0.4       0.4
  Other                                            1.5       1.5         1.5       1.6
                                                 ------    ------      ------    ------
Total operating expenses                          95.3      94.6        95.5      94.4
                                                 ------    ------      ------    ------
Operating income                                   4.7       5.4         4.5       5.6
Interest expense                                  (0.7)     (0.8)       (0.7)     (1.1)
                                                 ------    ------      ------    ------
Income before income taxes                         4.0       4.6         3.8       4.5
                                                 ------    ------      ------    ------
- -----------------------------
(1) Net of fuel surcharges.
</TABLE>


THREE MONTHS ENDED SEPTEMBER 30, 2004 VS. THREE MONTHS ENDED SEPTEMBER 30, 2003

Logistics  and  brokerage  services  revenues,  before  fuel  surcharges,  of
approximately  $10.3  million  in  the  third  quarter  of 2004 was unchanged as
compared to the third quarter of 2003.

Salaries,  wages  and  benefits  increased  from  4.4%  of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003  to 5.6% of revenues, before fuel
surcharges,  in the third quarter of 2004. The increase relates to the hiring of
an  administrative  staff  at East Coast Transport, Inc. for functions which had
previously  been  outsourced  to  a  third party and to an increase in corporate
general and administrative salaries being allocated to the division.

Rent  and purchased transportation decreased from 88.2% of revenues, before fuel
surcharges,  in  the  third  quarter  of  2003 to 87.4% of revenues, before fuel
surcharges, in the third quarter of 2004. The decrease relates to an increase in
fuel  surcharges  collected on brokered loads which offset amounts paid to third
parties for logistics and brokerage services.

The  logistics  and  brokerage services division operating ratio, which measures
the  ratio of operating expenses, net of fuel surcharges, to operating revenues,
before  fuel  surcharges,  increased to 95.3% for the third quarter of 2004 from
94.6% for the third quarter of 2003.


NINE MONTHS ENDED SEPTEMBER 30, 2004 VS. NINE MONTHS ENDED SEPTEMBER 30, 2003

For  the  first  nine  months  ended September 30, 2004, logistics and brokerage
services  revenues,  before  fuel surcharges, increased 9.5% to $31.7 million as
compared  to  $29.0  million for the first nine months ended September 30, 2003.
The  increase  of  approximately $2.7 million was attributable to the additional
one  month  revenues, before fuel surcharges, generated by East Coast Transport,
Inc. which wasn't acquired until January 31, 2003.

Salaries,  wages  and  benefits  increased  from  4.3%  of revenues, before fuel
surcharges,  in  the  first nine months of 2003 to 5.4% of revenues, before fuel
surcharges, in the first nine months of 2004. The increase relates to the hiring
of an administrative staff at East Coast Transport, Inc. for functions which had
previously  been  outsourced  to  a  third party and to an increase in corporate
general and administrative salaries being allocated to the division.

The  logistics  and  brokerage services division operating ratio, which measures
the  ratio of operating expenses, net of fuel surcharges, to operating revenues,
before  fuel  surcharges,  increased  to 95.5% for the first nine months of 2004
from 94.4% for the first nine months of 2003.


LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
During  the  first  nine  months of 2004, the Company generated $21.5 million of
cash  from operating activities. Investing activities used $12.6 million in cash
in  the first nine months of 2004. Financing activities used $2.1 million in the
first nine months of 2004.

Our  primary use of funds is for the purchase of revenue equipment. We typically
use  our existing lines of credit, proceeds from the sale or trade of equipment,
and  cash  flows  from  operations  to  finance  capital  expenditures and repay
long-term  debt.  During  the first nine months of 2004 we utilized cash on hand
and  our lines of credit to finance revenue equipment purchases of approximately
$34.7 million.

Occasionally we finance the acquisition of revenue equipment through installment
notes  with fixed interest rates and terms ranging from 36 to 48 months, however
as  of  September  30,  2004,  we  had  no  outstanding  indebtedness under such
installment notes.

In  order  to maintain our tractor fleet count it is often necessary to purchase
replacement  tractors  and  place them in service before trade units are removed
from  service.  The timing difference created during this process often requires
the Company to pay for new units without any reduction in price for trade units.
In  this  situation,  the  Company later receives payment for the trade units as
they  are  delivered  to the equipment vendor and have passed vendor inspection.
During  the  nine  months  ended  September  30,  2004,  the  Company  received
approximately $17.5 million for tractors delivered for trade.

During  the  remainder  of  2004  we  expect  to  purchase approximately 140 new
tractors  and  approximately  400 new trailers while continuing to sell or trade
older  equipment,  which  we  expect  to  result  in net capital expenditures of
approximately $11.4 million.

We  maintain  a  $20.0  million  revolving  line  of  credit and a $30.0 million
revolving  line  of  credit  (Line  A  and  Line  B, respectively) with separate
financial  institutions. Amounts outstanding under Line A bear interest at LIBOR
(determined  as  of  the first day of each month) plus 1.40%, are secured by our
accounts  receivable  and  mature  on  May  31,  2005.  At  September  30,  2004
outstanding  advances  on  Line  A  were  approximately $1.3 million, consisting
entirely  of  letters  of  credit,  with  availability  to borrow $18.7 million.
Amounts  outstanding under Line B bear interest at LIBOR (determined on the last
day  of  the  previous  month)  plus 1.15%, are secured by revenue equipment and
mature  on  June 30, 2006.  At September 30, 2004, $27.0 million, including $7.0
million  in letters of credit were outstanding under Line B with availability to
borrow  $3.0  million. In an effort to reduce interest rate risk associated with
these  floating  rate  facilities,  we  have  entered  into  interest  rate swap
agreements  in  an  aggregate  notional  amount of $20.0 million. For additional
information  regarding  the  interest  rate  swap  agreements, see Note B to the
condensed consolidated financial statements.

Trade  accounts  receivable  at  September 30, 2004 increased approximately $7.7
million  from  December  31,  2003.  Certain  of the Company's largest customers
regularly  schedule  plant shutdowns for various periods during December and the
volume  of  freight  we  ship  is  reduced during such scheduled shutdowns. This
reduction in freight volume results in a reduction in accounts receivable at the
end of each year.

Prepaid expenses and deposits at September 30, 2004 increased approximately $3.5
million  as compared to December 31, 2003. The increase relates to the Company's
annual  registration  fees  for tractors and trailers which occurs each January,
and to the prepayment of certain insurance policies. These prepaid expenses will
be amortized to expense through the remainder of the year.


NEW ACCOUNTING PRONOUNCEMENTS
- -----------------------------
See  Note C to the condensed consolidated financial statements for a description
of  the  most  recent accounting pronouncements and their impact, if any, on the
Company.


Item 3.  Quantitative and Qualitative Disclosures about Market Risk.
- --------------------------------------------------------------------
The  Company's  primary  market risk exposures include commodity price risk (the
price  paid  to obtain diesel fuel for our tractors) and interest rate risk. The
potential  adverse  impact of these risks and the general strategies the Company
employs to manage such risks are discussed below.

The  following  sensitivity analyses do not consider the effects that an adverse
change  may  have on the overall economy nor do they consider additional actions
the Company may take to mitigate our exposure to such changes. Actual results of
changes  in  prices or rates may differ materially from the hypothetical results
described below.

COMMODITY PRICE RISK

Prices  and  availability  of  all  petroleum products are subject to political,
economic  and  market  factors  that  are  generally  outside  of  our  control.
Accordingly,  the  price  and  availability  of  diesel  fuel,  as well as other
petroleum  products,  can be unpredictable. Because our operations are dependent
upon  diesel  fuel,  significant increases in diesel fuel costs could materially
and  adversely  affect  our results of operations and financial condition. Based
upon  our  2003 fuel consumption, a 10% increase in the average annual price per
gallon  of  diesel fuel would increase our annual fuel expenses by $3.5 million.

In  August  2000  and  July  2001,  we  entered  into agreements to obtain price
protection  and  reduce  a  portion  of our exposure to fuel price fluctuations.
Under  these agreements, we were obligated to purchase minimum amounts of diesel
fuel  per  month,  with  a price protection component, for the six month periods
ended  March 31, 2001 and February 28, 2002. The agreements also provide that if
during the 48 months commencing April 2001, the average monthly price of heating
oil  on  the  New  York  Mercantile  Exchange  ("NY MX HO") falls below $.58 per
gallon,  we  are  obligated  to  pay,  for  a maximum of twelve different months
selected  by  the  contract  holder  during such 48-month period, the difference
between  $.58  per  gallon  and  NY  MX  HO average price, multiplied by 900,000
gallons.  Accordingly, in any month in which the holder exercises such right, we
would  be obligated to pay the holder $9,000 for each cent by which $.58 exceeds
the  average  NY  MX  HO  price  for that month. The estimated fair value of the
agreements  are periodically adjusted and as of September 30, 2004 the estimated
fair  value  of  $625,000 is included in accrued liabilities in the accompanying
condensed consolidated financial statements. For the three and nine month period
ended September 30, 2004 an adjustment of $125,000 was made which had the effect
of  reducing  operating  supplies  expense and other current liabilities each by
$125,000 in the accompanying condensed consolidated financial statements.


INTEREST RATE RISK

Our  lines of credit each bear interest at a floating rate equal to LIBOR plus a
fixed  percentage.  Accordingly, changes in LIBOR, which are effected by changes
in interest rates generally, will affect the interest rate on, and therefore our
costs  under,  the  lines of credit. In an effort to manage the risks associated
with  changing  interest  rates,  we  entered into interest rate swap agreements
effective February 28, 2001 and May 31, 2001, on notional amounts of $15,000,000
and  $5,000,000,  respectively.  The "pay fixed rates" under the $15,000,000 and
$5,000,000  swap  agreements  are  5.08%  and  4.83%, respectively. The "receive
floating  rate" for both swap agreements is "1-month" LIBOR. These interest rate
swap  agreements  terminate  on  March  2,  2006 and June 2, 2006, respectively.
Assuming  $20.0 million of variable rate debt was outstanding under each of Line
A  and Line B for a full fiscal year, a hypothetical 100 basis point increase in
LIBOR would result in approximately $200,000 of additional interest expense, net
of  the  effect of the swap agreements. For additional information see Note B to
the condensed consolidated financial statements.


Item 4.  Controls and Procedures.
- ---------------------------------

Evaluation of disclosure controls and procedures.

In  accordance  with  Rule 13a-15(b) of the Securities Exchange Act of 1934 (the
"Exchange  Act"),  the Company's management evaluated, with the participation of
the Company's President and Chief Executive Officer and Chief Financial Officer,
the  effectiveness  of  the  design  and  operation  of the Company's disclosure
controls  and  procedures  (as defined in Rule 13a-14(c) and 15d-14(c) under the
Exchange  Act)  as  of  September  30, 2004. Based upon that evaluation of these
disclosure  controls  and  procedures, the President and Chief Executive Officer
and  the  Chief  Financial  Officer  concluded  that the disclosure controls and
procedures  were effective as of September 30, 2004 so that material information
relating to the Company, including its consolidated subsidiaries, was made known
to them by others within those entities, particularly during the period in which
this quarterly report on Form 10-Q was being prepared.

Changes in internal controls over financial reporting.

There  was  no change in the Company's internal control over financial reporting
that  occurred  during  the quarter ended September 30, 2004 that has materially
affected,  or  is reasonably likely to materially affect, the Company's internal
control over financial reporting.

<PAGE>



                         PART II.  OTHER INFORMATION
                         ---------------------------



Item 1.  Legal Proceedings
- --------------------------

On  October 10, 2002, a suit was filed against one of the Company's subsidiaries
entitled "The Official Committee of Unsecured Creditors of Bill's Dollar Stores,
Inc.  v.  Allen  Freight  Services Co."  The suit, which was filed in the United
States  Bankruptcy  Court  for  the  District  of Delaware, alleged preferential
transfers  of  $660,055  were made to the defendant, Allen Freight Services Co.,
within the 90 day period preceding the bankruptcy petition date of Bill's Dollar
Stores,  Inc.  This  suit  was  settled  on  October  21,  2004  at  a  cost  of
approximately  $25,000.  Accordingly,  the  remaining  amount  of  approximately
$635,000  has  been removed as a liability on the Company's financial statements
and  the  related  expense  originally  recorded  as a bad debt expense has been
appropriately reduced.

In  addition to the specific legal action mentioned above, the nature of the our
business  routinely  results  in  litigation,  primarily  involving  claims  for
personal injuries and property damage incurred in the transportation of freight.
We  believe  that an unfavorable outcome in one or more of those cases would not
have a material adverse effect on our financial condition.


Item 6.  Exhibits
- -----------------

       Exhibits required by Item 601 of Regulations S-K:

           3.1  - Amended and Restated Certificate of Incorporation
                  of the Registrant (Incorporated by reference to Exhibit 3.1
                  to the Company's report on Form 10-Q for the period ending
                  March 31, 2002.)

           3.2  - Amended and Restated By-Laws of the Registrant
                  (Incorporated by reference to Exhibit 3.2 to the Company's
                  report on Form 10-Q for the period ending March 31, 2002.)

          10.1  - P.A.M. Transportation Services, Inc. Employee Non-Qualified
                  Stock Option Agreement

          10.2  - P.A.M. Transportation Services, Inc. Director Non-Qualified
                  Stock Option Agreement

          10.3  - Executive Officers and Certain Other Employees Incentive
                  Compensation Plan, as amended

          11.1  - Statement Re:  Computation of Diluted Earnings Per Share

          31.1  - Rule 13a-14(a) Certification of Principal Executive Officer

          31.2  - Rule 13a-14(a) Certification of Principal Financial Officer

          32.1  - Section 1350 Certification of Chief Executive Officer

          32.2  - Section 1350 Certification of Chief Financial Officer

<PAGE>



                                   SIGNATURES


Pursuant  to  the  requirements  of  the  Securities  Exchange  Act of 1934, the
Registrant  has  duly  caused  this  report  to  be  signed on its behalf by the
undersigned thereunto duly authorized.



                                   P.A.M. TRANSPORTATION SERVICES, INC.


Dated:   November 8, 2004          By: /s/ Robert W. Weaver
                                   ---------------------------------
                                   Robert W. Weaver
                                   President and Chief Executive Officer
                                   (principal executive officer)


Dated:   November 8, 2004          By: /s/ Larry J. Goddard
                                   ---------------------------------
                                   Larry J. Goddard
                                   Vice President-Finance, Chief Financial
                                   Officer, Secretary and Treasurer
                                   (principal accounting and financial officer)


<PAGE>



                       P.A.M. TRANSPORTATION SERVICES, INC.

                         INDEX TO EXHIBITS TO FORM 10-Q


Exhibit
Number                        Exhibit Description
- --------     ---------------------------------------------------------

 3.1         Amended and Restated Certificate of Incorporation
             of the Registrant (Incorporated by reference to Exhibit 3.1
             to the Company's report on Form 10-Q for the period ending
             March 31, 2002.)

 3.2         Amended and Restated By-Laws of the Registrant
             (Incorporated by reference to Exhibit 3.2 to the Company's
             report on Form 10-Q for the period ending March 31, 2002.)

10.1         P.A.M. Transportation Services, Inc. Employee Non-Qualified
             Stock Option Agreement

10.2         P.A.M. Transportation Services, Inc. Director Non-Qualified
             Stock Option Agreement

10.3         Executive Officers and Certain Other Employees Incentive
             Compensation Plan, as amended

11.1         Statement Re:  Computation of Diluted Earnings Per Share

31.1         Rule 13a-14(a) Certification of Principal Executive Officer

31.2         Rule 13a-14(a) Certification of Principal Financial Officer

32.1         Section 1350 Certification of Chief Executive Officer

32.2         Section 1350 Certification of Chief Financial Officer


<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>doc2.txt
<TEXT>
EXHIBIT 10.1

                      P.A.M. TRANSPORTATION SERVICES, INC.
                      NON-QUALIFIED STOCK OPTION AGREEMENT
                      ------------------------------------

THIS  NON-QUALIFIED  STOCK  OPTION  AGREEMENT  ("Option  Agreement") is made and
entered into as of __________________ (the "Option Date"), by and between P.A.M.
TRANSPORTATION  SERVICES,  INC.  (the "Company") and ___________________________
(the "Employee");

                              W I T N E S S E T H:
                              - - - - - - - - - -

WHEREAS,  the  Board  of Directors of the Company has adopted the Company's 1995
Stock  Option  Plan, which has been approved by the shareholders of the Company,
and  has  been  amended by an Amendment to 1995 Stock Option Plan adopted by the
Board  of  Directors  of  the  Company  on  ___________________ (as amended, the
"Plan").  Pursuant  to  the  terms  of  the  Plan, the Board of Directors or the
Committee  designated  by  the  Board  of  Directors  to administer the Plan has
selected  the  Employee  to  participate in the Plan and desires to grant to the
Employee  a  non-qualified  stock  option  to  purchase  shares of the Company's
authorized  $.01  par  value  common  stock  ("Stock"), subject to the terms and
conditions set forth below in this Option Agreement;

NOW,  THEREFORE,  in  consideration  of  the  mutual  promises,  agreements  and
covenants  contained  in  this  Option Agreement and for other good and valuable
consideration,  the  receipt  and  sufficiency  of  which  are acknowledged, the
parties to this Option Agreement agree as follows:

                         1.  INCORPORATION OF PROVISIONS

This  Option Agreement is subject to and is to be construed in all respects in a
manner  which  is consistent with the terms of the Plan, the provisions of which
are  incorporated  by  reference into this Option Agreement. Unless specifically
provided  otherwise, all terms used in this Option Agreement shall have the same
meaning as in the Plan.

                               2.  GRANT OF OPTION

Subject  to  the  further  terms  and  conditions  of this Option Agreement, the
Employee  is  granted  a non-qualified stock option to purchase ________________
shares  of Stock, effective as of the Option Date. This stock option is intended
to  be a non-qualified stock option and is not intended to be an incentive stock
option  as  provided  in  Section  422  of the Internal Revenue Code of 1986, as
amended (the "Code").

                                3.  OPTION PRICE

The  Board  of Directors or the Committee has determined that the price for each
share  of  Stock purchased under this Option Agreement shall be $________, which
is the Market Price per share as provided for in Section 8(a) of the Plan.

                            4.  EXPIRATION OF OPTIONS

The  option  to acquire Stock pursuant to this Option Agreement shall expire (to
the  extent  not  previously  fully  exercised)  upon  the first to occur of the
following:

 (a) ______________,  20___

 (b) The  date which is three months following the date upon which the Employee
     ceases  to  be  employed by the Company or any majority-owned subsidiary of
     the  Company,  otherwise  than  as  a  result  of  the  Employee's death or
     permanent and total disability(as defined in Section 8(g) of the Plan);

 (c) The date which is the first anniversary of the date upon which the Employee
     ceases  to  be employed by the Company, or any majority-owned subsidiary of
     the  Company,  by  reason  of  the  Employee's death or permanent and total
     disability; or

 (d) The  date  upon which the Employee ceases to be employed by the Company or
     any  majority-owned  subsidiary  of  the Company, for any reason, including
     death  or  permanent  and  total disability, with respect to any portion of
     this  option  which is not then exercisable on the date the Employee ceases
     his employment with the Company.


                             5.  EXERCISE OF OPTION

Unless  the  option  to  acquire  Stock  pursuant to this Option Agreement shall
earlier  lapse  or  expire  pursuant  to  Article  4  hereof, this option may be
exercised  with respect to the aggregate number of shares subject to this Option
Agreement in accordance with the vesting schedule applicable to the Employee and
subject  to the performance criteria for vesting, set forth in Exhibit A to this
Option Agreement.

To  the extent that this option become exercisable in accordance with the above,
the  Employee  may exercise this non-qualified stock option, in whole or in part
from  time to time. The option exercise price may be paid by the Employee either
in  cash, or at the discretion of the Committee, by surrender of other shares of
Stock  of the Company held by Employee or a combination of cash and such shares.
If  the  Committee permits the surrender of other shares of Stock of the Company
as  all or part of the option exercise price, the Employee shall be given credit
against the option exercise price for such shares surrendered in an amount equal
to  the  Market  Price  per share of Stock determined as provided for in Section
2(g)  of  the  Plan  on the day preceding the day of the exercise of the option,
times the number of shares of Stock surrendered.

                             6.  MANNER OF EXERCISE

This  non-qualified  stock  option  may  be  exercised  by written notice to the
Company  specifying  the  number  of  shares  to  be purchased and signed by the
Employee  or  such  other person who may be entitled to acquire stock under this
Option  Agreement.  If  any  such  notice  is  signed by a person other than the
Employee,  such  person  shall  also  provide  such  other  information  and
documentation  as the Board of Directors or the Committee may reasonably require
to  assure  that such person is entitled to acquire Stock under the terms of the
Plan and this Option Agreement.

                       7.  RESTRICTIONS ON TRANSFERABILITY

The  non-qualified stock option granted under this Option Agreement shall not be
transferable  by  the  Employee otherwise than by will or by the laws of descent
and  distribution,  and  such  non-qualified  stock  option shall be exercisable
during the Employee's lifetime only by the Employee.

             8.  FURTHER RESTRICTIONS ON EXERCISE AND SALE OF STOCK

Subject to the provisions of the third paragraph of this Article 8, neither this
Option  nor  any  portion  thereof shall be exercisable at any time during which
there  is  not  on file with the Securities and Exchange Commission an effective
Registration  Statement  covering the option shares on Form S-8, or on any other
or similar form promulgated by the Securities and Exchange Commission.

Nothing contained in this section shall be construed to obligate the Company to,
or to grant any right to the holder of this Option to, cause the Company to file
any  Registration Statement; or, if any such Registration Statement is filed, to
prepare  any  additional  prospectus, to file any amendments to the Registration
Statement, or to continue said Registration Statement in effect.

If  at  any  time during which this Option is otherwise exercisable according to
its  terms  there  is  no  effective  Registration  Statement  on  file with the
Securities  and  Exchange  Commission  covering  the  shares  then  acquirable
hereunder,  the  Board of Directors or the Committee shall permit this Option to
be exercised by the holder hereof, upon its satisfaction that the offer and sale
of  such  option  shares  to  the  option  holder  is  exempt  in  fact from the
registration  requirements  of  the Securities Act of 1933, as amended, and such
state  securities  laws  as shall be applicable, and may condition such exercise
upon  its receipt of such representations, factual assurances and legal opinions
as  it  shall  deem  necessary to determine and document the availability of any
such exemption and may further condition such exercise upon such undertakings by
the  holder hereof or such restriction upon the transferability of the shares to
be  acquired  hereunder  as it shall determine to be necessary to effectuate and
protect the claim to any such exemption.

IN  WITNESS WHEREOF, the Company has caused this Option Agreement to be executed
by  a  member  of  the  Board  of  Directors or a duly authorized officer of the
Company,  and  the  Employee has executed this Option Agreement as of the Option
Date.

P.A.M.  TRANSPORTATION  SERVICES,  INC.

By:____________________________

Its:  _________________________



ATTEST:

________________________________
Secretary or Assistant Secretary



"EMPLOYEE"

_______________________________
Name:




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>doc3.txt
<TEXT>
EXHIBIT 10.2

                      P.A.M. TRANSPORTATION SERVICES, INC.
                      NON-QUALIFIED STOCK OPTION AGREEMENT
                      ------------------------------------

THIS  NON-QUALIFIED STOCK OPTION AGREEMENT ("Option Agreement") made and entered
into  as  of  _________________,  by and between P.A.M. TRANSPORTATION SERVICES,
INC. (the "Company") and  _____________________  ("Non-Employee Director");

                              W I T N E S S E T H;
                              -------------------

WHEREAS,  the  Board  of  Directors of the Company has adopted that certain 1995
Stock  Option  Plan,  as  amended  (the  "1995  Plan"),  a copy of which will be
provided  to  Non-Employee Director at his request. Pursuant to the terms of the
1995  Plan,  and  more  specifically,  Section 10, Non-Employee Director will be
granted  certain non-qualified stock options to purchase shares of the Company's
authorized  $.01  par  value  common  stock  ("Stock"), subject to the terms and
conditions hereinafter set forth;

NOW,  THEREFORE,  in  consideration  of  the  mutual  promises,  agreements  and
covenants  contained  herein  and for other good and valuable consideration, the
receipt  and  sufficiency  of  which are hereby acknowledged, the parties hereto
agree as follows:

                       1.     INCORPORATION OF PROVISIONS

This  Option Agreement is subject to and is to be construed in all respects in a
manner  which  is  consistent with the terms of the 1995 Plan, the provisions of
which  are  hereby incorporated by reference into this Option Agreement.  Unless
specifically  provided  otherwise, all terms used in this Option Agreement shall
have the same meaning as in the 1995 Plan.

                             2.     GRANT OF OPTION

Subject  to  the  further  terms  and  conditions of this Option Agreement, Non-
Employee  Director  is  hereby  granted a non-qualified stock option to purchase
2,000 shares of Stock, effective as of the date first written above.  Hereafter,
on  March 2 of each year during the term of the 1995 Plan, Non-Employee Director
shall  be  granted, without the necessity of action by the Board of Directors or
any  committee  thereof, an option to purchase 2,000 shares of Stock.  The total
number  of  shares  granted pursuant to options that Non-Employee Director holds
under  the  1995  Plan is reflected in Exhibit A, attached hereto, which will be
updated  annually  and delivered to Non-Employee Director for attachment to this
Option Agreement.


                          3.     OPTION EXERCISE PRICE

Pursuant to the terms of the 1995 Plan, the option exercise price for each share
of  stock  purchased  under  this Option Agreement shall be equal to 100% of the
"Market  Price"  of  the  Stock  as  determined by the Board of Directors or the
Committee  pursuant  to the 1995 Plan. The option exercise price is reflected in
Exhibit A, attached hereto.

                          4.     EXPIRATION OF OPTIONS

The  option  to acquire Stock pursuant to this Option Agreement shall expire (to
the  extent  not  previously  fully  exercised)  upon  the first to occur of the
following:

(a)  the date which is the fifth anniversary of the date of grant;

(b)  the  date  which is the 90th day following the date upon which Non-Employee
     Director  ceases  to be a director of the Company for any reason other than
     Non-Employee  Director's  death  or  permanent  disability;

(c)  the date which is the first anniversary of the date upon which Non-Employee
     Director ceases to be a director of the Company as a result of Non-Employee
     Director's death or permanent disability.

                            5.     EXERCISE OF OPTION

Unless  options  hereunder  shall  earlier lapse or expire pursuant to Article 4
hereof,  this  option  may  be exercised with respect to the aggregate number of
shares subject to this Option Agreement commencing on the date of grant.

To  the extent such option becomes exercisable in accordance with the foregoing,
Non-Employee  Director may exercise this non-qualified stock option, in whole or
in part from time to time. The option exercise price may be paid by Non-Employee
Director  either in cash or by surrender of other shares of Stock of the Company
held  by  Non-Employee  Director, or a combination of both, as authorized by the
Board of Directors or the Committee. Non-Employee Director shall be given credit
against the option exercise price hereunder for such shares surrendered equal to
the Market Price of the Stock.

                            6.     MANNER OF EXERCISE

This  non-qualified  stock  option  may  be  exercised  by written notice to the
Company  specifying  the  number  of  shares  to  be  purchased  and  signed  by
Non-Employee Director or such other persons who may be entitled to acquire Stock
under  this  Option  Agreement.  If  any such notice is signed by a person other
than  Non-Employee  Director,  such  person  shall  also  provide  such  other
information  and  documentation as the Board of Directors may reasonably require
to  assure  that such person is entitled to acquire Stock under the terms of the
1995 Plan and this Option Agreement.

                     7.     RESTRICTIONS ON TRANSFERABILITY

The  non-qualified  stock  option granted hereunder shall not be transferable by
Non-Employee  Director  otherwise  than  by  will  or by the laws of descent and
distribution,  and  such  non-qualified stock option shall be exercisable during
Non-Employee  Director's  lifetime  only  by  Non-Employee  Director.

             8.  FURTHER RESTRICTIONS ON EXERCISE AND SALE OF STOCK

Neither  this  option  nor  any portion thereof shall be exercisable at any time
during which there is not on file with the Securities and Exchange Commission an
effective  Registration  Statement  covering  the  option shares on Form S-8, or
similar for promulgated by the Securities and Exchange Commission.

Nothing contained in this section shall be construed to obligate the Company to,
or to grant any right to the holder of this option to, cause the Company to file
any  Registration Statement; or, if any such Registration Statement is filed, to
prepare  any  additional  prospectus, to file any amendments to the Registration
Statement, or to continue said Registration Statement in effect.

If  at  any  time during which this option is otherwise exercisable according to
its  terms  there  is  no  effective  Registration  Statement  on  file with the
Securities  and  Exchange  Commission  covering  the  shares  then  acquirable
hereunder,  the  Board  of  Directors  may,  in its sole discretion, permit this
option  to  be  exercised  by  the holder hereof, upon its satisfaction that the
offer and sale of such option shares to the option holder is exempt in fact from
the  registration  requirements  of  the Securities Act of 1933, as amended, and
such  state  securities  laws  as  shall  be  applicable, and may condition such
exercise  upon its receipt of such representations, factual assurances and legal
opinions  as  it shall deem necessary to determine and document the availability
of  any  such  exemption  and  may  further  condition  such  exercise upon such
undertakings  by  the holder hereof or such restriction upon the transferability
of  the shares to be acquired hereunder as it shall determine to be necessary to
effectuate and protect the claim to any such exemption.

IN  WITNESS WHEREOF, the Company has caused this Option Agreement to be executed
by  a  member  of  the  Board  of  Directors or a duly authorized officer of the
Company,  and Non-Employee Director has executed this Option Agreement as of the
date first above written.

P.A.M.  TRANSPORTATION  SERVICES,  INC.


By:  ____________________________________
                 President


ATTEST:

____________________________________
           Secretary


"NON-EMPLOYEE  DIRECTOR"



____________________________________



                                    EXHIBIT A

                                       TO

                      NON-QUALIFIED STOCK OPTION AGREEMENT
                            DATED __________ BETWEEN
                      P.A.M. TRANSPORTATION SERVICES, INC.
                          AND THE NON-EMPLOYEE DIRECTOR

                     OUTSTANDING OPTIONS AS OF _____________




        SHARES SUBJECT TO    EXERCISE  PRICE
DATE     OPTION  GRANTED        PER  SHARE
- ----     ---------------        ----------









</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>4
<FILENAME>doc9.txt
<TEXT>
                       P.A.M. TRANSPORTATION SERVICES, INC.
                       INCENTIVE COMPENSATION PLAN - 2000C
                           CALENDAR YEARS 2000 - 2002


THIS IS THE INCENTIVE COMPENSATION PLAN of P.A.M. Transportation Services, Inc.,
a  Delaware  corporation  (the "Company"), under which bonuses may be granted to
certain employees of the Company and it subsidiaries subject to the limitations,
provisions and requirements hereinafter stated.  The Plan is as follows:

1.  PURPOSES
- ------------
The  purposes of the P.A.M. Transportation Services, Inc. Incentive Compensation
Plan  2000C  (the  "Plan")  are  as  follows:

     (a)  To  encourage  each  participant  in  the  Plan  to  make  exceptional
          contributions  to  further  the  growth,  success  and  profits of the
          Company.


     (b)  To  foster teamwork and personal involvement in the Company's success.


     (c)  To  provide  the  Company  with an objective method of recognizing and
          rewarding certain employees who have been or will be given substantial
          responsibility for the direction and management of the Company.


     (d)  The  pronouns "he" and "his" are used throughout this document.  These
          pronouns  shall be used to describe male and female employees without
          without discrimination.

2.  ADMINISTRATION OF PLAN
- --------------------------
This  Plan  shall be administered by the Compensation and Stock Option Committee
of  the  Company's  Board  of  Directors (the "Committee"). This Committee shall
interpret the Plan in a manner consistent with its purposes; and, subject to the
terms  of  the  Plan, will have discretion to determine who shall participate in
the Plan and the amounts of any incentive compensation to be awarded pursuant to
the  Plan.  All  actions and determinations of the Committee taken in connection
with  the  Plan,  including the awarding of any incentive compensation, shall be
final  and  conclusive.  The  Committee  may  adopt  rules from time to time for
carrying out the Plan.


3.  ELIGIBLE EMPLOYEES
- ----------------------

     (a) Upon  the  adoption  of  the  Plan  and  at  or near the start of each
         succeeding  calendar  year,  eligible  employees  shall  include:

        (i) all full-time employees of the Company and its subsidiaries that are
            individually  selected  by  the  Compensation  Committee,  in  its
            discretion, and

       (ii) additionally,  the  Committee  may,  in  its  discretion,  allow a
            recently promoted or hired officer or employee to participate in the
            Plan commencing with the date of his promotion or his employment, as
            the case may be.

     (b) Eligible employees shall be paid the Incentive Compensation as provided
         in this Plan only if:

        (i) the  eligible employee was employed without interruption during the
            applicable  calendar year from January 1 through December 31, except
            as provided in Sections 3(a)(ii) and 4(d) herein, and

       (ii) the  eligible employee must be employed at the time that the bonus
            is  actually  paid  pursuant  to Section 4(c). In the event that the
            participant's  employment  is terminated, by reason of (x) discharge
            with  or  without  cause  or  (y)  voluntary  termination  by  the
            participant,  at  any  time  during  the calendar year or before the
            actual  payment  date  in  Section 4(c), such terminated participant
            shall  not  be  entitled to any bonus for such calendar year, unless
            specifically authorized by the Committee.

     (c) Any eligible employee that participates in this Plan is not eligible to
         participate  in  Incentive  Bonus  Plan  2000A  or  Plan  2000B.

4.  MECHANICS OF THE PLAN
- -------------------------
The  Plan  will  award  participants for above-average profitability and revenue
growth, as measured by the Company's operating ratio and year over year increase
in operating revenues:

     (a) Annual  Plan.  This Plan is an "annual plan" and incentive awards shall
         be  based  on  audited results of operations for each respective fiscal
         year  ending  December  31.

     (b) Incentive  Awards.  The Board of Directors or Committee shall establish
         the  targeted  operating  ratios  and  corresponding  Effective  Bonus
         Percentages  for  each  calendar  year at or near the completion of the
         audit  of  the Company's financial statements for the previous calendar
         year;  provided,  however,  that  the  targeted  operating  ratios  and
         effective  bonus  percentages for the 2000-2002 calendar years shall be
         established  by  the Board of Directors upon the adoption of this Plan.
         Upon  adoption  by  the  Board  of Directors or Committee, the targeted
         operating  ratio  and  bonus  percentages for the current calendar year
         shall  be  set  forth  on a schedule and attached hereto as an exhibit.
         Under the Plan, each participant shall be awarded a bonus not to exceed
         the  sum  of  the  following  calculations:

        (i) Annual  base compensation multiplied by the product of the effective
            bonus percentage times 95%. However, no bonus shall be payable under
            this  subpart  (i)  if  the  Company's  Consolidated Operating Ratio
            exceeds  93.5%;  and

       (ii) Annual  compensation  multiplied  by  the  product  of the effective
            bonus  percentage times 5%. However, no bonus shall be payable under
            this subpart (ii) unless the Consolidated Operating Revenues for the
            bonus  calculation  year  are  110%  or  more  of  the  Consolidated
            Operating  Revenues  reported  by  the  Company  for the immediately
            preceding  bonus  calculation  year,  and

      (iii) The  subpart  (i)  and  subpart  (ii)  bonus  calculations  are
            independent  of  each  other and entitlement to a bonus under either
            subpart  is  not dependent on whether a bonus is due under the other
            subpart,  and

       (iv) The  Company's  Board  of  Directors  recognizes  that the long term
            well being of the Company may require actions which adversely affect
            the  Consolidated Operating Ratio or Consolidated Operating Revenues
            over  the  short  term.  Accordingly,  upon  recommendation  by  the
            Committee,  the  Company's  Board  of  Directors  may  in  its  sole
            discretion  waive  the  Consolidated  Operating  Ratio  and/or  the
            Consolidated  Operating  Revenue thresholds set forth in subpart (i)
            and  subpart  (ii),  respectively.

     (c) Payment  of  Awards.  Any bonus awarded hereunder shall be paid by the
         Company  upon the determination of the bonus as defined in this Plan by
         the  Company's  independent  accountants.  The  payments of the bonuses
         shall  be  as  follows:

         (i)  Any bonus that is awarded for the 2000 calendar year shall be made
              as follows:

              (x)  fifty  percent  (50%) of the bonus shall be paid on or before
                   March 31, 2001:

              (y)  twenty  five  percent  (25%) of the bonus shall be paid on or
                   before March 31, 2002; and

              (z)  twenty  five  percent  (25%) of the bonus shall be paid on or
                   before March 31, 2003.

        (ii)  Any bonus that is awarded for the 2001 calendar year shall be made
              as follows:

              (x)  fifty  percent  (50%) of the bonus shall be paid on or before
                   March 31, 2002;

              (y)  twenty  five  percent  (25%) of the bonus shall be paid on or
                   before March 31, 2003; and

              (z)  twenty  five  percent  (25%) of the bonus shall be paid on or
                   before March 31, 2004.

       (iii)   Any  bonus  that  is awarded for the 2002 calendar year shall be
               made as follows:

              (x)  fifty  percent  (50%) of the bonus shall be paid on or before
                   March 31, 2003;

              (y)  twenty  five  (25%)  of  the bonus shall be paid on or before
                   March 31, 2004; and

              (z)  twenty  five  (25%)  of  the bonus shall be paid on or before
                   March 31, 2005.

     (d) Death  or Disability.  Notwithstanding anything contained herein to the
         contrary,  if  a participant's employment ceases on account of death or
         total  disability,  as  defined  in  105 (d)(4) of the Internal Revenue
         Code,  such participant shall be entitled to receive a pro-rata portion
         of  any  bonus  he  otherwise  would  be  awarded. In either event, the
         participant  shall  be  entitled  to  an amount equal to a normal bonus
         award  under  Section  4(b)  multiplied  by a fraction the numerator of
         which  shall  be  the  number  of  days  in  a  year  during  which the
         participant  was participating in the Plan and the denominator of which
         shall  be  365  days.  For  example,  a  participant  with  annual base
         compensation  of $50,000 dies on July 1 of a calendar year. The Company
         has  a  Effective  Bonus Percentage of 20% for that calendar year which
         otherwise would entitle the participant to a bonus of 20% of his annual
         base  compensation  or $10,000. Such participant would be entitled to a
         bonus  equal  to $10,000 x 182/365 or $4,986. All bonus amounts payable
         to a deceased or disabled participant shall be paid to such participant
         or his personal representative, as the case may be.

     (e) Recently Promoted or Hired Employees. In the event the Committee allows
         a  recently  promoted  or  hired  employee  to participate in the Plan,
         pursuant  to  Section  3(a)(ii)  such  participant shall be entitled to
         receive  a pro-rata portion of any bonus he otherwise would be awarded.
         Such  pro-rata  bonus shall be the amount equal to a normal bonus award
         under  Section  4(b)  multiplied  by  a fraction the numerator of which
         shall  be  the  number of days in the year during which the participant
         was  participating  in  the  Plan and denominator of which shall be 365
         days. For example, a participant commences participation in the Plan on
         July  1  of a calendar year at annual base compensation of $50,000. The
         Company  has  a Effective Bonus Percentage for that calendar year which
         otherwise would entitle the participant to a bonus of 20% of his annual
         base  compensation  or  $5,000. Such participant would be entitled to a
         bonus equal to $5,000 x 183/365 or $4,986.

     (f) Applicable  Base  Annual Compensation:  For purposes of calculating all
         bonus awards hereunder, whenever the term "annual base compensation" of
         a  participant  is  referred  in this Plan it shall mean the following:

        (i) With  respect  to  any  eligible  employee who is compensated on the
            basis  of  a  fixed  salary,  annual  base compensation shall be the
            amount  of  such  base  salary  determined  at  December  31 of each
            calendar year.

       (ii) With  respect  to  any  eligible  employee who is compensated on the
            basis  of  hourly wages, the annual base compensation shall be equal
            to  the  base  wage of such eligible employee at December 31 of each
            calendar year and then annualized.

      (iii) In  the  event  an  eligible employee is terminated prior to the end
            of  the  plan  year  and  the  Committee specifically authorizes the
            payment  of  the Incentive Bonus pursuant to section 3(b)(iii), then
            the  annual  base compensation shall be determined as of the date of
            termination.


5.  NOTICES
- -----------
The  Board  of Directors or the Committee shall notify all employees selected to
participate in the Plan as soon as practicable after such determination has been
made.  The  participants  shall be notified of the targeted operating ratios and
corresponding  effective  bonus  percentages  for  each  calendar  year, and any
subsequent  modifications  thereto,  as  soon  as  practicable  after  such
determinations have been made by the Committee.

6.  OTHER BENEFITS
- ------------------
This  Plan is employees for exceptional contributions made by such employees and
any  awards hereunder are intended to be in addition to any other benefits which
the Company provides to the participants.

The  Board of Directors or the Committee may, but is not obligated to, award one
or more of the participants additional bonuses in such amounts and at such times
as  the  Board  of  Directors  or  the  Committee, in its sole discretion, shall
determine.

7.  AMENDMENTS TO PLAN
- ----------------------
The  Board  of  Directors  or  the  Committee  may  from  time to time make such
amendments  to  the  Plan as the Board or the Committee, in its sole discretion,
shall  deem  desirable,  including  modifying  the targeted operating ratios and
corresponding bonus percentages established pursuant to Section 4(b) at any time
during a calendar year.

8.  TERMINATION OF THE PLAN
- ----------------------------
The Board of Directors may at any time terminate the Plan. In the event the Plan
is  terminated,  the  Company  shall not have any obligation to the participants
under the Plan unless the Board of Directors states that the Company has assumed
an  obligation.  For  example, assume the Plan is terminated on December 15 of a
calendar  year.  No  participant  shall have a right to receive, and the Company
shall  not  have any obligation to pay, any bonus amount under the Plan for that
calendar  year  unless the Board of Directors expressly states the Company shall
pay  such  bonus  amount.

9.  NONASSIGNABILITY
- --------------------
No participant shall have the right to assign or transfer any of his benefits or
expected  benefits  under  the Plan except by will or by the laws of descent and
distribution.

10.  GLOSSARY OF TERMS
- ----------------------
The  following  definitions  apply  to  the  terms  as  used  in  this  Plan.

Eligible  Salaries  of Plan Participants: The salaries of each Plan Participant,
as  of  December  31  of each calendar year, shall be added together. The sum of
these  salaries  shall  be  the  Eligible  Salaries  of  Plan  Participants.

Company Annual Consolidated Revenue: The calendar year revenues of the following
subsidiaries  shall  be  added  together.  The  sum  of  the  revenues  of  the
subsidiaries  listed  herein,  shall be the Company Annual Consolidated Revenue.
For  purposes of this Plan, operating revenue shall not include interest income,
other  non-operating income or extraordinary items, and operating expenses shall
not  include  any  incentive compensation awarded hereunder, interest expense or
income taxes but shall include loss (gain) on sale of equipment. For purposes of
this  Plan, the operating ratio shall be determined to the nearest one-hundredth
of  one percent (.01%). The revenue of the following subsidiaries shall include:
P.A.M.  Transport, Inc., P.A.M. Dedicated Services, Inc., Choctaw Express, Inc.,
Allen Freight Services, Inc., and Decker Transport Co., Inc. With respect to the
revenues  of  Decker Transport Co., Inc., the revenue generated by the brokerage
division  of  Decker  Transport Co., Inc., shall not apply toward the revenue of
Decker Transport Co., Inc., for the purposes of this Plan. With respect to Allen
Freight  Services,  Inc., the annual revenues and expenses shall be divided into
Allen  Freight  Services, Inc., and Bill's Dollar Store. Allen Freight Services,
Inc.,  and  Bill's  Dollar  Stores  shall  be  treated  as  two separate Company
subsidiaries  for this Plan. In the event, the Company acquires a new subsidiary
during  any  calendar  year  under this Plan, the subsidiary's revenue shall not
apply  toward  the  Company's  Annual  Consolidated  Revenue.

Subsidiary  Annual Revenue and Expenses: The calendar year revenues and expenses
generated  by  each  individual  subsidiary  of  the  Company,  to-wit:  P.A.M.
Transport,  Inc.,  P.A.M. Dedicated Services, Inc., Choctaw Express, Inc., Allen
Freight  Services,  Inc.,  and  Decker  Transport  Co., Inc. With respect to the
revenues  of  Decker Transport Co., Inc., the revenue generated and the expenses
incurred  by  the  brokerage  division  of Decker Transport Co., Inc., shall not
apply  toward  the  Subsidiary Annual Revenue of Decker Transport Co., Inc., for
the  purposes  of  this  Plan. With respect to Allen Freight Services, Inc., the
annual revenues and expenses shall be divided into Allen Freight Services, Inc.,
and  Bill's Dollar Store. Allen Freight Services, Inc., and Bill's Dollar Stores
shall  be treated as two separate Company subsidiaries for this Plan. Any amount
of  money  accrued  during the calendar year for bonus payment expense shall not
apply  toward  the  Annual  Expenses  for  the  Subsidiary.

Subsidiary  Percent  of Revenue: The Subsidiary Percent of Revenue is calculated
by  dividing  the  Subsidiary  Annual Revenue by the Company Annual Consolidated
Revenue  expressed  as  a  percentage.

Subsidiary  Bonus  Eligible  Salaries: The Subsidiary Bonus Eligible Salaries is
calculated  by  multiplying the Subsidiary Percent of Revenue times the Eligible
Salaries  of  Plan  Participants.

Operating  Ratio of Subsidiary: This term shall mean the operating ratio of each
individual  subsidiary  of  P.A.M.  Transportation  Services, Inc. The operating
ratio  shall  be  determined to the nearest one-hundredth of one percent (.01%).

Subsidiary  Bonus  Factor:  Determine  the  Bonus  Percentage  from  the  Bonus
Percentage  Table found in Attachment One by using the Annual Operating Ratio of
the  Subsidiary.  Multiply  the  Subsidiary Bonus Eligible Salaries by the Bonus
Percentage.  The  product  of  these two numbers in the Subsidiary Bonus Factor.

Consolidated  Bonus  Factor:  The  Consolidated  Bonus  Factor is the sum of the
Subsidiary  Bonus  Factors.

Effective  Bonus  Percentage:  The  Effective  Bonus Percentage is calculated by
dividing  the  Consolidated  Bonus  Factor  by  the  Eligible  Salaries  of Plan
Participants  as  expressed  in  a  percentage.

Percentage:  All  percentages  shall  be  determined  to  the  nearest  1/100th.




This  Plan  has been adopted and approved at a meeting of the Board of Directors
of the Company on the 15th day of June, 2000 and shall be effective for calendar
years  2000  through  2002  inclusive,  unless otherwise amended by the Board of
Directors.



                                    EXHIBIT A

                      P.A.M. TRANSPORTATION SERVICES, INC.
                        INCENTIVE COMPENSATION PLAN 2000C

                   TARGETED CONSOLIDATED OPERATING RATIOS AND
                         CORRESPONDING BONUS PERCENTAGES
                         FOR 2000 - 2002 CALENDAR YEARS




   Subsidiary                             Bonus
Operating Ratio                         Percentage
- ----------------                        ----------
90.0% and above                             0.0%
89.0%  to  89.9%                           20.0%
88.0%  to  88.9%                           30.0%
87.0%  to  87.9%                           40.0%
86.0%  to  86.9%                           50.0%
85.0%  to  85.9%                           60.0%
84.0%  to  84.9%                           70.0%
83.0%  to  83.9%                           80.0%
82.0%  to  82.9%                           90.0%
81.0%  to  81.9%                          100.0%
80.0%  to  80.9%                          110.0%
Under  80%                                120.0%





                        EXCERPTS OF RESOLUTIONS OF THE
                     COMPENSATION AND STOCK OPTION COMMITTEE
     OF THE BOARD OF DIRECTORS OF P.A.M. TRANSPORTATION SERVICES, INC. ADOPTED
                                FEBRUARY 17, 2004
    AMENDING INCENTIVE COMPENSATION PLAN 2000C WHICH IS APPLICABLE TO EXECUTIVE
                      OFFICERS AND CERTAIN OTHER EMPLOYEES


INCENTIVE COMPENSATION PLANS - EXTENSION THROUGH 2004
- -----------------------------------------------------

     The  Committee discussed the Company's Incentive Compensation Plan - 2000A,
Incentive  Compensation Plan 2000B, and Incentive Compensation Plan 2000C, which
are  currently  in  effect  for  employees  of the Company and its subsidiaries.
These  plans  originally  applied  to  the  years  2000, 2001 and 2002, and were
previously extended to also apply to 2003.  The Committee discussed the purposes
of  these  plans.  The Committee also discussed their continued appropriateness,
and  the  extent  to  which they are likely to meet the Company's objectives for
compensating  and  motivating  its  employees, and increasing the return for the
shareholders  of  the  Company.  [text omitted]  The Committee also considered a
Schedule provided by the Company's executive officers recommending the employees
who  should  participate  in Incentive Compensation Plan 2000B and 2000C.  After
further  discussion,  upon  motion  duly  made  and  seconded,  the  following
resolutions were unanimously adopted.

RESOLVED,  that  the Committee has determined that Incentive Compensation Plan -
2000A  ("Plan  A"),  Incentive Compensation Plan 2000B ("Plan B"), and Incentive
Compensation  Plan 2000C ("Plan C"), which are presently in effect (collectively
the  "Plans"), should be extended for an additional year so they will also apply
to the calendar year 2004, and the Plans are extended to apply to 2004.

RESOLVED  FURTHER,  that the provisions of Exhibit A to each of the three Plans,
respectively,  which  establish  the  targeted consolidated operating ratios and
corresponding  bonus  percentages  for  2000-2002 calendar years, and which were
also  applied  for  calendar  year 2003, shall, subject to the provisions of the
Plans, also apply to 2004.

RESOLVED  FURTHER,  that  the employees who should participate in each of Plan B
and  Plan  C  are those listed for those plans in the schedule presented to this
meeting,  and  subject  to  the  provisions  of  the  Plans,  such employees are
designated  to  participate  in  Plan B and Plan C as set forth in the schedule.
[text omitted]

RESOLVED FURTHER, that pursuant to Section 7 of Plan B and Plan C, respectively,
Sections  4(c)  (Payments of Awards) of each of such Plans are amended by adding
new  clauses  (iv) and (v) to each that follow the timing patterns of awards for
prior  years,  while making specific provision for corresponding timing for 2003
and 2004 awards, and provide as follows:

(iv)  Any bonus that is awarded for the 2003 calendar year shall be made as
      follows:

     (x)  fifty percent (50%) of the bonus shall be paid on or before March
          31, 2004;

     (y)  twenty-five percent (25%) of the bonus shall be paid on or before
          March 31, 2005; and

     (z)  twenty-five percent (25%) of the bonus shall be paid on or before
          March 31, 2006.

(iv)  Any bonus that is awarded for the 2004 calendar year shall be made as
      follows:

     (x)  fifty percent (50%) of the bonus shall be paid on or before March
          31, 2005;

     (y)  twenty-five percent (25%) of the bonus shall be paid on or before
          March 31, 2006; and

     (z)  twenty-five percent (25%) of the bonus shall be paid on or before
          March 31, 2007.  [text omitted]


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-11.1
<SEQUENCE>5
<FILENAME>doc4.txt
<TEXT>
EXHIBIT 11.1

           STATEMENT RE:  COMPUTATION OF DILUTED EARNINGS PER SHARE

Diluted  earnings per share computations assume the exercise of stock options to
purchase  shares  of common stock. The shares assumed exercised are based on the
weighted  average  number  of shares under options outstanding during the period
and  only  include  those  options for which the exercise price is less than the
average  share  price  during the period. The net additional shares issuable are
calculated  based  on  the  treasury  stock method and are added to the weighted
average number of shares outstanding during the period.

<TABLE>
<CAPTION>

DILUTED EARNINGS PER SHARE FOR THE PERIOD ENDED SEPTEMBER 30, 2004     Three Months    Nine Months
- ------------------------------------------------------------------      ----------      ----------
<S>                                                                    <C>             <C>
Actual net income (A)                                                  $ 3,147,789     $ 8,825,729
                                                                        ==========      ==========

Assumed exercise of stock options and warrants                              64,152          62,628
Application of assumed proceeds ($698,997 and $659,966)
  toward repurchase of outstanding common stock at an average
  market price of $18.340 and $18.066, respectively.                       (38,113)        (36,531)
                                                                        ----------      ----------
Net additional shares issuable                                              26,039          26,097
                                                                        ==========      ==========

Adjustment of shares outstanding:
  Weighted average common shares outstanding                            11,298,055      11,296,411
  Net additional shares issuable                                            26,039          26,097
                                                                        ----------      ----------
  Adjusted shares outstanding (B)                                       11,324,094      11,322,508
                                                                        ==========      ==========
Net income per common share (A) divided by (B)                         $      0.28     $      0.78
                                                                        ==========      ==========


DILUTED EARNINGS PER SHARE FOR THE PERIOD ENDED SEPTEMBER 30, 2003     Three Months    Nine Months
- ------------------------------------------------------------------      ----------      ----------
<S>                                                                    <C>             <C>
Actual net income (A)                                                  $ 2,964,507     $ 9,828,644
                                                                        ==========      ==========

Assumed exercise of stock options and warrants                              63,059         377,254
Application of assumed proceeds ($671,180 and $7,918,746)
  toward repurchase of outstanding common stock at an average
  market price of $22.678 and $23.522, respectively.                       (29,596)       (336,653)
                                                                        ----------      ----------
Net additional shares issuable                                              33,463          40,601
                                                                        ==========      ==========

Adjustment of shares outstanding:
  Weighted average common shares outstanding                            11,293,147      11,289,927
  Net additional shares issuable                                            33,463          40,601
                                                                        ----------      ----------
  Adjusted shares outstanding (B)                                       11,326,610      11,330,528
                                                                        ==========      ==========
Net income per common share (A) divided by (B)                         $      0.26     $      0.87
                                                                        ==========      ==========
</TABLE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>6
<FILENAME>doc5.txt
<TEXT>
EXHIBIT 31.1


            RULE 13a-14(a) CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER


I, ROBERT W. WEAVER, President and Chief Executive Officer, certify that:

(1)  I have reviewed this quarterly report on Form 10-Q of P.A.M. TRANSPORTATION
     SERVICES, INC., a Delaware corporation (the "registrant");

(2)  Based  on  my  knowledge, this quarterly report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this report;

(3)  Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included  in  this  report,  fairly  present  in  all material
     respects  the  financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

(4)  The registrant's  other  certifying  officer(s) and I  are  responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

 (a) Designed such disclosure controls and procedures, or caused such disclosure
     controls  and  procedures  to  be designed under our supervision, to ensure
     that  material  information  relating  to  the  registrant,  including  its
     consolidated  subsidiaries,  is  made  known  to  us by others within those
     entities,  particularly  during  the  period  in which this report is being
     prepared;

 (b) Evaluated  the  effectiveness  of  the registrant's disclosure controls and
     procedures  and  presented  in  this  report  our  conclusions  about  the
     effectiveness  of  the disclosure controls and procedures, as of the end of
     the period covered by this report based on such evaluation; and

 (c) Disclosed  in  this  report any change in the registrant's internal control
     over  financial reporting that occurred during the registrant's most recent
     fiscal  quarter  (the  registrant's fourth fiscal quarter in the case of an
     annual  report)  that  has  materially affected, or is reasonably likely to
     materially  affect,  the  registrant's  internal  control  over  financial
     reporting; and

(5)  The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

 (a) All  significant  deficiencies  and  material  weaknesses  in the design or
     operation of internal control over financial reporting which are reasonably
     likely  to  adversely  affect  the registrant's ability to record, process,
     summarize and report financial information; and

 (b) Any  fraud,  whether  or  not  material,  that involves management or other
     employees  who have a significant role in the registrant's internal control
     over financial reporting.


Date:  November 8, 2004

                                  By:   /s/ Robert W. Weaver
                                  --------------------------------------
                                  Robert W. Weaver
                                  President and Chief Executive Officer
                                  (principal executive officer)




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>7
<FILENAME>doc6.txt
<TEXT>
EXHIBIT 31.2


            RULE 13a-14(a) CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER


I, LARRY J. GODDARD, Chief Financial Officer, certify that:

(1)  I have reviewed this quarterly report on Form 10-Q of P.A.M. TRANSPORTATION
     SERVICES, INC., a Delaware corporation (the "registrant");

(2)  Based  on  my  knowledge, this quarterly report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this report;

(3)  Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included  in  this  report,  fairly  present  in  all material
     respects  the  financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

(4)  The  registrant's  other  certifying  officer(s) and  I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

 (a) Designed such disclosure controls and procedures, or caused such disclosure
     controls  and  procedures  to  be designed under our supervision, to ensure
     that  material  information  relating  to  the  registrant,  including  its
     consolidated  subsidiaries,  is  made  known  to  us by others within those
     entities,  particularly  during  the  period  in which this report is being
     prepared;

 (b) Evaluated  the  effectiveness  of  the registrant's disclosure controls and
     procedures  and  presented  in  this  report  our  conclusions  about  the
     effectiveness  of  the disclosure controls and procedures, as of the end of
     the period covered by this report based on such evaluation; and

 (c) Disclosed  in  this  report any change in the registrant's internal control
     over  financial reporting that occurred during the registrant's most recent
     fiscal  quarter  (the  registrant's fourth fiscal quarter in the case of an
     annual  report)  that  has  materially affected, or is reasonably likely to
     materially  affect,  the  registrant's  internal  control  over  financial
     reporting; and

(5)  The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

 (a) All  significant  deficiencies  and  material  weaknesses  in the design or
     operation of internal control over financial reporting which are reasonably
     likely  to  adversely  affect  the registrant's ability to record, process,
     summarize and report financial information; and

 (b) Any  fraud,  whether  or  not  material,  that involves management or other
     employees  who have a significant role in the registrant's internal control
     over financial reporting.


Date:  November 8, 2004

                                   By:  /s/  Larry  J.  Goddard
                                   --------------------------------------------
                                   Larry J. Goddard
                                   Vice President-Finance, Chief Financial
                                   Officer, Secretary and Treasurer
                                   (principal accounting and financial officer)




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>8
<FILENAME>doc7.txt
<TEXT>
EXHIBIT 32.1


                 SECTION 1350 CERTIFICATION OF CHIEF EXECUTIVE OFFICER


In  connection with the Quarterly Report of P.A.M. Transportation Services, Inc.
(the "Company") on Form 10-Q  for  the  period  ending  September 30, 2004, (the
"Report")  filed  with  the  Securities  and  Exchange  Commission, I, Robert W.
Weaver,  President and Chief Executive Officer of the Company, certify, pursuant
to  18  U.S.C.  Section  1350,  as  adopted  pursuant  to  Section  906  of  the
Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1)  The  Report  fully complies with the requirements of section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

(2)  The  information  contained  in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Company.


Date:  November 8, 2004

                                   By:  /s/ Robert W. Weaver
                                   -------------------------------------
                                   Robert W. Weaver
                                   President and Chief Executive Officer
                                   (chief executive officer)




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>9
<FILENAME>doc8.txt
<TEXT>
EXHIBIT 32.2


                 SECTION 1350 CERTIFICATION OF CHIEF FINANCIAL OFFICER


In  connection with the Quarterly Report of P.A.M. Transportation Services, Inc.
(the "Company") on Form 10-Q  for  the  period  ending  September 30, 2004, (the
"Report")  filed  with  the  Securities  and  Exchange  Commission,  I, Larry J.
Goddard,  Vice  President-Finance,  Chief  Financial  Officer,  Secretary  and
Treasurer  of  the  Company,  certify,  pursuant  to  18 U.S.C. Section 1350, as
adopted  pursuant  to Section 906 of the Sarbanes-Oxley Act of 2002, that to the
best of my knowledge:

(1)  The  Report  fully complies with the requirements of section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

(2)  The  information  contained  in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Company.


Date:  November 8, 2004

                                   By:  /s/ Larry J. Goddard
                                  -----------------------------------------
                                   Larry J. Goddard
                                   Vice President-Finance, Chief Financial
                                   Officer, Secretary and Treasurer
                                   (chief accounting and financial officer)




</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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