SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, DC 20549

                                     FORM 10-K

(Mark One)
[  X  ]  ANNUAL  REPORT  PURSUANT  TO  SECTION  13  OR  15(d)  OF THE SECURITIES
         EXCHANGE ACT OF 1934 (FEE REQUIRED)
         For the Fiscal Year Ended September 30, 1999
                                        OR
[     ]  TRANSITION REPORT PURSUANT TO SECTION 13  OR  15(d)  OF THE  SECURITIES
         EXCHANGE  ACT OF 1934 (NO FEE REQUIRED).
         For the transition period from ____________ to ______________


                          Commission file number 0-27208

                        SIMON TRANSPORTATION SERVICES INC.
              (Exact name of registrant as specified in its charter)

             Nevada                                      87-0545608
  (State or Other Jurisdiction              (I.R.S. Employer Identification No.)
of Incorporation or Organization)


         5175 West 2100 South
        West Valley City, Utah                                  84120
(Address of Principal Executive Offices)                      (Zip Code)

Registrant's telephone number, including area code:         801/924-7000

Securities Registered Pursuant to Section 12(b) of the Act: None

Securities Registered Pursuant to Section 12(g) of the Act: $0.01 Par Value
                                                            Class A Common Stock
                                                            --------------------

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 if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by  reference in Part III of this Form 10-K or any  amendments  to
this Form 10-K. [ ]

The  aggregate  market value of the voting stock held by  non-affiliates  of the
registrant  was  $19,952,788  as of November  30, 1999 (based upon the $5.75 per
share  closing  price on that  date as  reported  by  NASDAQ).  In  making  this
calculation the registrant has assumed,  without admitting for any purpose, that
all  executive  officers,  directors,  and holders of more than 5% of a class of
outstanding common stock, and no other persons, are affiliates.

As of November 30, 1999, the registrant had  5,196,358 shares of Class A  Common
Stock and 913,751  shares of Class B Common Stock outstanding.

DOCUMENTS  INCORPORATED BY REFERENCE:  The information set forth under Part III,
Items 10, 11, 12, and 13 of this Report is  incorporated  by reference  from the
registrant's   definitive  proxy  statement  for  the  1999  annual  meeting  of
stockholders or an amendment hereto that will be filed no later than January 28,
2000.


<PAGE>


                             Cross Reference Index

The following  cross  reference index indicates the document and location of the
information  contained  herein and incorporated by reference into the Form 10-K.
<TABLE>

<S>         <C>                                                            <C>
                                                                           Document and Location

                                        Part I
Item 1      Business                                                       Pages 3 - 8 herein
Item 2      Properties                                                     Page 9 herein
Item 3      Legal Proceedings                                              Page 9 herein
Item 4      Submission of Matters to a Vote of Security Holders            Page 9 herein

                                        Part II
Item 5      Market for Registrant's Common Equity and
               Related Stockholder Matters                                 Page 10 herein
Item 6      Selected Financial and Operating Data                          Page 11 herein
Item 7      Management's Discussion and Analysis of Financial              Pages 12 - 20 herein
               Condition and Results of Operations
Item 8      Financial Statements and Supplementary Data                    Page 20 herein
Item 9      Changes in and Disagreements with Accountants on               Page 21 herein
               Accounting and Financial Disclosure

                                       Part III
Item 10     Directors and Executive Officers of the Registrant             Pages 2, 3 and 7 of Proxy Statement
Item 11     Executive Compensation                                         Pages 5 and 6 of Proxy Statement
Item 12     Security Ownership of Certain Beneficial Owners and            Page 9 of Proxy Statement
               Management
Item 13     Certain Relationships and Related Transactions                 Page 4 of Proxy Statement

                                        Part IV
Item 14     Exhibits, Financial Statement Schedules and Reports on         Pages 22 - 37 herein
               Form 8-K
</TABLE>

This report contains  "forward-looking"  statements in paragraphs marked with an
asterisk.  These statements are subject to certain risks and uncertainties  that
could cause actual  results to differ  materially  from those  anticipated.  See
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations  Cautionary  Statement  Regarding  Forward-Looking   Statements"  for
additional  information and factors to be considered concerning  forward-looking
statements.


<PAGE>


                                   PART I

Item 1:    BUSINESS

The Company

         Simon  Transportation  is  a  truckload  carrier  that  specializes  in
temperature-controlled  transportation  services for major  shippers in the food
industry.  Richard D. Simon  founded the Company  with one truck in 1955.  Today
Simon  Transportation  operates  nationwide and in eight Canadian provinces from
its strategically located headquarters in Salt Lake City, Utah, and terminals in
Phoenix, Arizona; Fontana, California; Atlanta, Georgia; and Katy, Texas.

         Simon Transportation Services Inc., a Nevada corporation,  is a holding
company  organized  in 1995,  the sole  business  of which is to own 100% of the
capital  stock of Dick Simon  Trucking,  Inc.,  a Utah  corporation.  Dick Simon
Trucking,   Inc.  was   incorporated   in  1972  and  had  operated  as  a  sole
proprietorship  since 1955.  Simon  Transportation  acquired  all of the capital
stock of Dick Simon Trucking, Inc.  contemporaneously with the November 17, 1995
effective  date of the Company's  initial public  offering.  Prior to such time,
Dick  Simon  Trucking,  Inc.  had  elected  to be  taxed  as  an S  corporation.
References to the "Company" herein refer to the consolidated operations of Simon
Transportation  Services and Dick Simon  Trucking.  See "Selected  Financial and
Operating Data",  "Management's  Discussion and Analysis of Financial  Condition
and Results of Operations", and Consolidated Financial Statements.

Strategy

         The Company has grown in recent  years by adding  revenue  equipment to
meet the  service  demands of new and  existing  customers  and  expanding  core
carrier  partnerships.  Management  plans to continue  the  Company's  growth by
capitalizing  on the trend  among  shippers  to place  increased  reliance  on a
smaller number of financially stable,  service-oriented  truckload carriers. The
key elements of the Company's strategy are:

         Food  Industry  Focus.  Simon   Transportation   focuses  on  providing
specialized service to sophisticated, high-volume customers in the food industry
such as Albertson's,  Campbell's Soup, Coca-Cola Foods, ConAgra,  Kraft, Nestle,
North American Logistics,  Pillsbury, and Procter & Gamble. These customers seek
nationwide transportation partners that understand the specialized needs of food
industry  shippers.  Many of the  Company's  customers  seek carriers that offer
late-model  equipment,  experienced  personnel,  advanced technology,  and broad
geographic  coverage.  Management  believes the food  industry is an  attractive
niche because consumers require food throughout all economic cycles.(*)

         Core  Carrier   Partnerships.   Simon   Transportation   has  grown  by
establishing  core carrier  partnerships  with  high-volume,  service  sensitive
shippers. Core carriers provide customers with consistent equipment availability
and  premium  service  such  as  time-definite  pick-up  and  delivery,  express
time-in-transit,   multiple   delivery  stops,  and  real-time  access  to  load
information through  satellite-based  tracking and communication systems and EDI
capability.  The Company also meets specialized  customer requests for access to
terminal facilities,  stationing employees at customer locations, and dedicating
equipment to specific  traffic lanes.  Management  believes major shippers favor
their  core  carrier  "partners"  during  periods  of  reduced  demand for truck
service,  and that the  trend  among  major  shippers  to reduce  the  number of
carriers used in favor of core carriers will continue.(*)

         Dedicated  Fleets.  Simon  Transportation  emphasizes  dedicated  fleet
operations  in which it offers round trip or  continuous  movement  service to a
shipper (or a shipper and one or more of its  suppliers) by  dedicating  certain
tractors and trailers exclusively to that shipper's needs.  Dedicated service is
desirable  because  the  customers  typically  pay a  round-trip  rate  per mile
assuming that the truck will return empty and cover all loading,  unloading, and
pallet costs. The Company frequently is able to further enhance revenue per mile
by locating a profitable load to cover unloaded segments.  In addition,  drivers
prefer the  predictable  runs and priority  treatment at shipping and  receiving

_________________________________
(*) "Forward-looking" statements.


<PAGE>
locations.   Management   intends  to  aggressively  grow  its  dedicated  fleet
operations  and  expects  this  service  niche to expand as  shippers  outsource
transportation needs presently served by private carriage.(*)

         Modern Fleet. Simon  Transportation  intends to maintain modern tractor
and trailer fleets. Reliable, late-model equipment promotes customer service and
driver  recruitment  and retention by minimizing the delays caused by breakdowns
and excessive maintenance.  In addition,  management believes that a practice of
replacing  tractors  while under  warranty  will reduce  expenses and permit the
Company  to take  advantage  of  improvements  in  fuel  economy  and  equipment
technology.(*)

         Technology.  Simon  Transportation  uses the  Qualcomm  satellite-based
tracking and  communication  system in all of its tractors.  This system and EDI
capability  improve  customer  service and operating  efficiency by offering the
Company and customers real time access to load locations and advance  warning of
potential  delivery delays.  The Company's document imaging system allows prompt
and  simultaneous  processing  of  payroll  and  billing  in  a  paperless  work
environment.  The Company's load optimization  software has been implemented and
is constantly updated to enhance service and profitability.  Management believes
shippers will continue to demand advanced  technology of their core carriers and
plans to respond to such requirements. (*)

Operations

         The  Company  conducts a  centralized  dispatch  and  customer  service
operation at its Salt Lake City  headquarters.  The operations center features a
fully-integrated, computerized network of dispatch, customer service, and driver
liaison personnel.  Customer service representatives solicit and accept freight,
quote rates, and serve as the primary contact with customers.  After accepting a
load,  customer  service  representatives  transfer  the  pick-up  and  delivery
information to the computer screen of the appropriate load planner,  who assigns
the  load to an  available  driver  based  upon  the  proximity  of the  trucks,
scheduled "home time," and available hours-in-service.  Dispatchers then use the
Qualcomm  satellite-based  tracking  and  communication  system  to  locate  the
position and  availability  status of equipment and notify the driver of pick-up
and  delivery   requirements,   route  and  fueling   instructions,   and  other
information.  Upon the assignment of a load, the Company's  proprietary software
calculates  the  projected  travel  time  from  origin to  destination  and uses
satellite  position updates and driver  communications  to provide load progress
reports  at  thirty-minute  intervals.  The  system  automatically  advises  the
appropriate  dispatcher and customer service  representative if a load is behind
schedule,  and  customers are able to use EDI to access  information  about load
locations at any time.  Management  believes  that these  satellite and computer
systems are crucial to  satisfying  the  stringent  service  standards,  such as
30-minute  pick-up  and  delivery  windows,  demanded  by shippers of their core
carriers.

         Management measures the Company's efficiency through miles per tractor,
empty miles  percentage,  revenue  per mile,  and  revenue  per  tractor.  Fleet
productivity  is tracked daily in the operations  center,  with actual  progress
matched  against a monthly goal. All  operations  personnel have access to these
statistics on a real time basis, and all participate in a cash bonus program for
achieving  certain  fleetwide  levels of miles per  tractor  per  month,  driver
turnover, and revenue per mile.

Customers and Marketing

         The Company's sales and marketing  function is led by senior management
and other sales  professionals based in its Salt Lake City headquarters and near
key customers. These sales personnel aggressively market Simon Transportation to
food industry shippers as a  customer-oriented  provider of dependable,  on-time
service.  The Company targets customers that seek financially stable,  long-term
transportation  partners  offering  dependable  equipment,   satellite  and  EDI
technologies,   and  premium  service.  This  customer  service  philosophy  has
contributed  to  continuing  demands for added  equipment to expand  service for
existing shippers and establishing core carrier  relationships with Albertson's,
Campbell's  Soup,  Coca-Cola  Foods,  ConAgra,  Kraft,  Nestle,  North  American
Logistics,  Pillsbury,  Procter & Gamble, and other major customers.  Management

_________________________________
(*) "Forward-looking" statements.


<PAGE>
intends to continue  developing  business with existing customers and attempting
to add new core carrier relationships. The Company's top 5, 10, and 25 customers
accounted for 29.2%,  41.2%, and 58.9% of revenue,  respectively,  during fiscal
1999, with Nestle (including Nestle's Stouffer's and Friskie's units) accounting
for 10.6% of revenue.  No other customer  accounted for more than 10% of revenue
during the fiscal year.

         Simon  Transportation  is a North  American  truck  line that  provides
service to and from customer locations  throughout the United States, in several
Canadian  provinces  and  Mexico.  The  Company  does not  maintain  any foreign
currency positions and therefore does not engage in any hedging  transactions to
manage foreign currency exposure.  The Company's operations are strongest in the
western  United States and between  points in the West to and from points in the
East and Southeast.  In addition to  traditional  for-hire  service,  management
emphasizes the marketing of dedicated fleet and regional distribution  services.
Dedicated  fleets  generally  receive  compensation  for all miles, and regional
operations  provide  a  stronger  presence  for  driver  recruiting.  Management
believes  that  these  services  offer  consistent  equipment   utilization  and
predictable home-time for drivers.

         The  Company  has  written  contracts  with  substantially  all  of its
customers.  These  contracts  generally  specify  service  standards  and rates,
eliminating the need for negotiating the rate for individual shipments. Although
a  contract  typically  runs for a  specified  term of at  least  one  year,  it
generally may be terminated by either party upon 30 days' notice.

Technology

         The  Company  uses  computer  and   satellite   technology  to  enhance
efficiency and customer service in all aspects of its operations, and management
believes  the  Company  is among  the  industry  leaders  in  applying  advanced
technology  to  improve   transportation   service.   The  Qualcomm  OmniTRACSTM
satellite-based tracking and communication system provides hourly updates of the
position of each tractor and permits real time communication  between operations
personnel and every driver. As a result,  dispatchers relay pick-up and delivery
times,  weather and road information,  route and fueling  directions,  and other
instructions  without  waiting  for a driver to stop and call the  Company.  The
Company's  entire fleet has been equipped with the Qualcomm  systems since 1992,
making it the  thirteenth  carrier in the nation to install the units in 100% of
its  tractors.  The Company's  proprietary  software also monitors load progress
against  projected  delivery  time  every  half-hour  and warns the  appropriate
dispatcher and customer  service  representative  if a load is behind  schedule.
This software also  facilitates  early routing toward each driver's home base by
signaling  dispatchers  several days in advance of drivers' requested  home-time
dates.

         The Company's EDI capability permits customers to communicate  directly
via computer link to tender loads, receive load confirmation, check load status,
and receive billing  information.  The Company's  largest  customers require EDI
service from their core carriers,  and more than 50% of the Company's revenue is
generated by customers  that  actively use EDI. EDI not only  improves  customer
service and  communication,  but also benefits the  Company's  cash flow through
accelerated receivable  collection.  The Company further enhances its operations
through  its  document  imaging  technology,  which  provides  customer  service
representatives  and  other  personnel  (all of whom have  computers)  real-time
access to freight bills,  supplier invoices,  and other information.  Management
believes that advanced  technology  will be required by an increasing  number of
large  shippers as they reduce the number of carriers  they use in favor of core
carriers.

         The Company has  designed a load  optimization  software  program  that
allows  customer  service   representatives  to  quote  rates  by  automatically
computing the range of acceptable  rates between any two points,  based upon the
rates for all Simon  Transportation  loads in and out of the  applicable  region
during  the past  year  and the need for  pallets,  multiple  stops,  and  other
additional  charges.  The system then  prioritizes  the loads and identifies the
optimal  tractor to accept a load,  based upon location,  empty miles  required,
revenue per mile,  remaining driver  hours-in-service,  maintenance  scheduling,
driver home time, and other factors.

<PAGE>
         The Company's  maintenance shops are fully  computerized and paperless,
and all  maintenance,  repair,  and  inspection  records  for each  vehicle  are
instantly  accessible.  Drivers  are able to  monitor  maintenance  progress  on
computer screens located in the driver lounge.

Year 2000 Compliance

         The  Company  has  completed  a review of each of its core  systems  to
determine year 2000 compliance.  The Company's billing,  dispatch, EDI, fueling,
payroll,  telephone,  vehicle  maintenance,  and  yard and  equipment  inventory
systems and all other critical hardware and software systems were designed to be
year 2000  compliant from  inception.  The Company has also completed its review
and  assessment  of the  year  2000  compliance  status  of its  facilities  and
equipment.  All facilities and systems are year 2000 compliant with the possible
exception of some older personal computers.  These computers do not perform date
critical job functions.  The Company will continue to replace these units during
the normal course of business.(*)

         In April 1999, the Company installed a new mainframe to handle its core
operating  systems.  The Company acquired the new computer as part of its normal
course of business.  The prior  machine  continues to serve as a backup  system.
Both  computers,  peripherals and all operating  software have been  extensively
tested by Company personnel and we believe all are year 2000 compliant.(*)

         The Company relies on Qualcomm to provide the satellite tracking system
necessary to track the location of its  equipment,  and to provide  dispatch and
routing  information  to its  drivers.  The Company has been  informed  that the
software utilized by Qualcomm and the Company is fully year 2000 compliant.  The
Company  utilizes  Comdata to transmit payroll funds to its drivers and to allow
drivers to  purchase  fuel  outside of the  Company's  terminal  locations.  The
Company has been informed that the software and systems  utilized by Comdata and
the Company is fully year 2000  compliant.  The Company also interacts with many
of its  vendors  through  electronic  data  interchange  (EDI).  The Company has
received  written   assurances  from  its  significant   vendors  and  customers
representing approximately 70% of its fiscal 1999 revenue that they will be year
2000  compliant.  Although  the  Company  is  year  2000  compliant  in its  EDI
applications,  we cannot and do not  guarantee  the year 2000  compliance of our
business partners' systems.(*)

         The Company has incurred  internal staff costs  necessary to review and
further year 2000 compliance of its core operating systems.  Because the systems
were designed to be year 2000 compliant since inception,  the costs have not had
a material effect on the Company's  financial position or results of operations.
The  Company  also  incurred  additional  internal  staff time to  complete  its
compliance  review of non-core  systems  embedded in facilities  and  equipment.
These non-core systems include microcontrollers contained in tractor engines and
other components,  refrigeration  units, and terminal  facilities.  The costs of
such review were not  incremental  since they  represented  the  redeployment of
existing information technology resources.(*)

         The Company  believes  that the most likely worse case  scenario is the
failure of some third party provided services.  The Company anticipates that the
risks  related to its core and  non-core  systems  will be  mitigated by ongoing
assessment  and  correction  of the systems.  The primary risk to  operations is
service   disruption   from   third-party   providers   that  supply   satellite
communication,  telephone,  fueling and financial  services.  Any  disruption of
these critical services would hinder the Company's  ability to receive,  process
and track its freight or communicate with its customers and drivers.(*)

         A failure of the satellite communication system could have a materially
adverse effect on the Company's business and results of operations.  The Company
is relying on the  contingency  plan  established  by  Qualcomm  to prevent  the
interruption of business.  As an additional backup, the Company plans to use its
existing  telephone systems to dispatch its equipment and provide support to its
drivers in the event of a complete satellite system failure. In the event of EDI
failures on the part of our  customers,  the Company  plans to use its telephone
and  facsimile  system to receive load tenders from its  customers.  The Company
would switch to paper invoices for its customers  unable to use EDI.  Management

_________________________________
(*) "Forward-looking" statements.


<PAGE>
believes  that the  Company's  current  state of  readiness,  the  nature of the
Company's business, and the availability of the contingency plans minimizes year
2000 risks.  Management does not foresee significant  liability to third parties
if the Company's systems are not year 2000 compliant.(*)

Revenue Equipment

         Simon Transportation's equipment strategy is to operate modern tractors
and trailers that help reduce parts,  maintenance,  and fuel costs,  promote the
reliable  service  customers  demand from core carriers,  and attract and retain
drivers. The Company operates  conventional tractors  (engine-forward)  equipped
with  electronic  engines  and Eaton  transmissions.  Most of the  tractors  are
covered by three-year,  500,000-mile engine warranties and lifetime transmission
warranties. Most of the tractors also are equipped with the "condo" sleeper cabs
preferred by drivers. The Company's practice is to trade or replace its tractors
on a  three-year  cycle,  and to trade or replace  its  trailers  on a five-year
cycle.

Drivers and Other Personnel

         Driver hiring and retention are critical to the success of all trucking
companies.  Simon  Transportation  emphasizes  driver  satisfaction and has made
significant  investments to improve its drivers' employment experience.  Drivers
are selected in accordance  with specific  Company quality  guidelines  relating
primarily to safety history,  driving  experience,  road test  evaluations,  and
other personnel evaluations,  including physical examinations and mandatory drug
testing. The Company offers competitive compensation, including mileage pay, and
full participation in all employee benefit and profit-sharing plans. The Company
uses proprietary software to warn dispatchers in advance of a driver's requested
home time.  Management  believes it has  promoted  driver  loyalty by  assigning
drivers  to  a  single  dispatcher,  regardless  of  geographic  area,  awarding
dedicated routes and regional distribution  positions to senior,  top-performing
drivers,  and  educating  customers  concerning  the need to treat  drivers with
respect.

         The truckload industry has experienced a shortage of qualified drivers.
Strict DOT  enforcement  of  hours-in-service  limitations,  mandatory  drug and
alcohol  testing,  and other safety  measures have shrunk the available  pool of
drivers and increased the cost of recruiting  and retention.  The  industry-wide
driver  shortage  adversely  affected the Company's  operations  during the 1999
fiscal year resulting in an unusually high number of tractors  without  drivers.
The Company's driver turnover was 110% in fiscal 1999,  measuring  drivers after
they are assigned a tractor.

         At September 30, 1999, Simon Transportation  employed approximately 450
non-driver  employees and approximately  1,850 drivers.  The Company's employees
have never been  represented by or attempted to organize a union, and management
believes it has a good relationship with the Company's employees.

Safety and Insurance

         Simon   Transportation   emphasizes   safety  in  all  aspects  of  its
operations.  Its  safety  program  includes:  (i)  initial  orientation;  (ii) a
three-week to six-week,  on-the-road  training  program;  and (iii)  progressive
penalties for  excessive  speed and log  violations.  The Company has earned the
highest DOT safety and fitness rating of "satisfactory," which most recently was
extended on November 1, 1999.

         The Company carries primary and excess liability  insurance coverage of
$50 million,  with a $250,000 basket deductible for personal injury and property
damage.  The Company's  workers'  compensation  coverage also carries a $100,000
deductible,  with no coverage  limit.  Management  believes these  coverages are
adequate to cover reasonably anticipated claims.


_________________________________
(*) "Forward-looking" statements.


<PAGE>


Competition

         The truckload  segment of the trucking  industry is highly  competitive
and   fragmented,   and  no  carrier  or  group  of   carriers   dominates   the
temperature-controlled  or dry van market. According to the September 1999 issue
of Refrigerated Transporter, the five largest temperature-controlled carriers by
revenue are C. R. England, Frozen Food Express Industries,  Rocor International,
Prime,  Inc., and KLLM Transport  Services.  The combined  revenue  reported for
these five carriers  comprises  approximately  38% of the estimated $4.3 billion
for-hire,  temperature-controlled  market.  The proprietary fleet portion of the
temperature-controlled  market has been  estimated at an  additional $3 billion.
The Company's 1999 fiscal year revenue  constituted  approximately three percent
of the total market for  temperature-controlled  services and approximately five
percent of the  for-hire  market.  The Company  competes  with a number of other
trucking  companies,  as well as  private  truck  fleets  used  by  shippers  to
transport their own products. The Company competes to a limited extent with rail
and rail-truck  intermodal  service,  but attempts to limit this  competition by
seeking service-sensitive freight. There are other trucking companies, including
diversified  carriers  with  large  temperature-controlled   fleets,  possessing
substantially  greater financial resources and operating more equipment than the
Company.

Fuel Availability and Cost

         The Company  actively  manages its fuel costs by  requiring  drivers to
fuel at Company  terminals or,  whenever  possible en route,  at service centers
with which the Company  has  established  volume  purchasing  arrangements.  The
Company  controls fuel purchases by using its proprietary  software and Qualcomm
communications  ability to schedule  fueling stops and amounts  purchased  based
upon fuel prices at locations on drivers' routes.  The Company  historically has
been able to pass through  most  increases in fuel prices and taxes to customers
in the form of higher rates or fuel  surcharges.  The Company has fuel surcharge
agreements with a majority of its customers.  However,  the recent  increases in
fuel prices will not be fully offset by these surcharges.

Regulation

         The  Company  is  a  common  and  contract  motor  carrier  of  general
commodities.  Historically,  the Interstate  Commerce Commission (the "ICC") and
various state agencies  regulated motor carriers'  operating rights,  accounting
systems,  mergers and  acquisitions,  periodic  financial  reporting,  and other
matters.  In 1995,  federal  legislation  preempted state  regulation of prices,
routes,  and services of motor  carriers  and  eliminated  the ICC.  Several ICC
functions  were  transferred to the  Department of  Transportation  (the "DOT").
Management does not believe that regulation by the DOT or by the states in their
remaining  areas of  authority  will have a  material  effect  on the  Company's
operations.  The Company's employee and independent contractor drivers also must
comply with the safety and fitness regulations promulgated by the DOT, including
those relating to drug and alcohol testing and hours of service.

         The Company's  operations are subject to various  federal,  state,  and
local environmental laws and regulations, implemented principally by the EPA and
similar state regulatory agencies, governing the management of hazardous wastes,
other discharge of pollutants  into the air and surface and underground  waters,
and the disposal of certain  substances.  These regulations  extend to the above
ground and  underground  fuel  storage  tanks  located at each of the  Company's
terminal facilities.  All of the Company's tanks are of double hull construction
in accordance with EPA requirements  and equipped with monitoring  devices which
constantly  monitor for leakage.  Management  is not aware of any fuel spills or
hazardous  substance  contamination  on its  properties  and  believes  that its
operations are in material compliance with current laws and regulations.

<PAGE>
Item 2.    PROPERTIES

         Simon Transportation  operates terminals and driver recruitment offices
at five locations. The Company's headquarters and primary terminal is located on
fifty-five  acres near the  intersection  of  Interstates 15 and 80 in Salt Lake
City, Utah. This facility  includes a 60,000 square foot office building housing
all operations and  administrative  personnel and  maintenance  facilities and a
driver  center  covering   approximately   97,000  square  feet.  The  Company's
additional terminal and driver recruitment facilities include owned locations in
Phoenix,  Arizona;  Fontana,  California;  and  Atlanta,  Georgia;  and a leased
location  in Katy,  Texas.  The  Company  leases  trailer  drop yards at Tulare,
California  and  various  customer  locations.  All  terminals  have modern fuel
facilities with environmental monitoring equipment.

         The available  acreage at the Company's  headquarters  will accommodate
future  expansion,  and the facility has been designed so that  additions can be
constructed to serve the Company's  foreseeable  future needs. See "Management's
Discussion  and Analysis of Financial  Condition  and Results of  Operations  --
Liquidity."


Item 3.    LEGAL PROCEEDINGS

         The Company and certain of its officers and  directors  have been named
as defendants in a securities  class action filed in the United States  District
Court for the District of Utah, Caprin v. Simon Transportation  Services,  Inc.,
et al.,  No.  2:98CV 863K (filed  December 3, 1998).  Plaintiffs  in this action
allege that defendants made material misrepresentations and omissions during the
period  February  13, 1997  through  April 2, 1998 in  violation of Sections 11,
12(2) and 15 of the  Securities  Act of 1933 and Sections 10(b) and 20(a) of the
Securities  Exchange  Act of 1934 and Rule  10b-5  promulgated  thereunder.  The
Company intends to vigorously defend this action.

         The Company from time to time is a party to  litigation  arising in the
ordinary course of its business,  substantially all of which involves claims for
personal injury and property damage incurred in the  transportation  of freight.
Management is not aware of any claims or threatened claims that reasonably would
be expected to exceed insurance limits or have a materially  adverse effect upon
the Company's operations or financial position.


Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         During the fourth quarter of the fiscal year ended  September 30, 1999,
no matters were submitted to a vote of security holders.



<PAGE>


                                   PART II

Item 5.    MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Price Range of Common  Stock.  The  Company's  Class A Common  Stock is
traded on the NASDAQ National Market under the NASDAQ symbol SIMN. The following
table sets forth for the calendar  periods  indicated  the range of high and low
bid quotations for the Company's  Class A Common Stock as reported by NASDAQ for
the fiscal years ended September 30, 1998 and 1999.

          Period                    High             Low
----------------------------    -------------    -------------
Calendar Year 1997
   4th Quarter                  $ 24     3/4     $ 21     3/4
Calendar Year 1998
   1st Quarter                  $ 24             $ 13     3/8
   2nd Quarter                  $ 15     5/8     $  6     3/8
   3rd Quarter                  $  6     7/8     $  4     7/8
   4th Quarter                  $  6   13/16     $  4     3/8
Calendar Year 1999
   1st Quarter                  $  7     1/2     $  4   11/16
   2nd Quarter                  $  6     1/2     $  4     1/2
   3rd Quarter                  $  5     3/4     $  4

         The prices  reported  reflect  interdealer  quotations  without  retail
mark-ups,  mark-downs or commissions, and may not represent actual transactions.
As of October 31, 1999, the Company had 177 stockholders of record of its common
stock.  However, the Company believes that it has approximately 1,500 beneficial
holders of common  stock  including  shares held of record by brokers or dealers
for their customers in street names.

         Dividend  Policy.  The  Company  has  never  declared  and  paid a cash
dividend on its common stock. It is the current intention of the Company's Board
of  Directors  to  continue  to retain  earnings  to  finance  the growth of the
Company's  business  rather  than  to pay  dividends.  Future  payments  of cash
dividends  will depend upon the financial  condition,  results of operations and
capital commitments of the Company, restrictions under then-existing agreements,
and other factors deemed relevant by the Board of Directors.



<PAGE>


Item 6.    SELECTED FINANCIAL AND OPERATING DATA

         The selected  consolidated  financial data presented  below reflect the
consolidated   financial   position   and   results  of   operations   of  Simon
Transportation  Services  Inc. and its  subsidiary.  The  selected  consolidated
financial data are derived from the Company's  consolidated financial statements
and should be read in conjunction with "Management's  Discussion and Analysis of
Financial  Condition and Results of Operations"  and the Company's  consolidated
financial statements and notes thereto included elsewhere herein.
<TABLE>
<CAPTION>
                                                                   Fiscal Years Ended September 30,
                                                     --------------------------------------------------------------
<S>                                                  <C>             <C>         <C>         <C>         <C>
(In thousands, except per share amounts & operating          1999         1998        1997        1996        1995
                                                             ----         ----        ----        ----        ----
data)
Statement of Operations Data:
  Operating revenue.................................    $ 209,143    $ 193,507   $ 155,296   $ 101,090   $  75,218
                                                     --------------------------------------------------------------
  Operating expenses:
    Salaries, wages, and benefits...................       90,876       80,500      60,504      40,015      28,035
    Fuel and fuel taxes.............................       37,262       35,281      30,069      20,359      14,115
    Operating supplies and expenses.................       27,872       26,156      19,289      13,701      10,839
    Taxes and licenses..............................        7,319        6,557       5,197       3,288       2,756
    Insurance and claims............................        6,591        5,217       3,404       2,172       2,003
    Communications and utilities....................        4,239        3,946       2,550       1,680       1,245
    Depreciation and amortization...................        4,466        4,728       5,396       5,920       7,223
    Rent............................................       34,363       28,987      17,143       4,794       2,926
                                                     --------------------------------------------------------------
      Total operating expenses......................      212,988      191,372     143,552      91,929      69,142
                                                     --------------------------------------------------------------
      Operating earnings (loss).....................       (3,845)       2,135      11,744       9,161       6,076
  Gain on sale of real property.....................           --           --       1,896          --          --
  Interest expense and other, net...................       (1,353)      (1,500)     (1,134)     (2,758)     (3,527)
                                                     --------------------------------------------------------------
  Earnings (loss) before provision for income taxes.       (5,198)         635      12,506       6,403       2,549
  Provision (benefit) for income taxes 1............       (1,965)         297       4,727       5,454          --
                                                     --------------------------------------------------------------
  Net earnings (loss)...............................    $  (3,233)   $     338   $   7,779   $     949   $   2,549
                                                     ==============================================================
Pro Forma Statement of Earnings Data: 1
  Earnings (loss) before provision for income taxes.    $  (5,198)   $     635   $  12,506   $   6,403   $   2,549
  Provision (benefit) for income taxes..............       (1,965)         297       4,727       2,536       1,010
                                                     --------------------------------------------------------------
  Net earnings (loss)...............................    $  (3,233)   $     338   $   7,779   $   3,867   $   1,539
                                                     ==============================================================
  Diluted net earnings (loss) per common share......    $   (0.53)   $    0.05   $    1.33   $    0.87   $    0.67
                                                     ==============================================================
  Diluted weighted average shares outstanding.......    6,116,815    6,270,734   5,864,043   4,464,837   2,300,000
                                                     ==============================================================
Balance Sheet Data (at end of period):
  Net property and equipment........................    $  57,648    $  64,618   $  71,154   $  56,714   $  52,200
  Total assets......................................       96,730       99,526     107,704      78,223      61,437
  Long-term debt and capitalized
    leases, including current portion...............       21,623       21,206      32,791      37,428      47,903
  Stockholders' equity..............................       55,944       59,699      59,849      29,103       9,033
Operating Data:
  Operating ratio 2.................................        101.8%        98.9%       92.4%       90.9%       91.9%
  Average revenue per loaded mile...................    $    1.26    $    1.25   $    1.25   $    1.24   $    1.26
  Average revenue per total mile....................    $    1.11    $    1.11   $    1.10   $    1.10   $    1.11
  Average revenue per tractor per week..............    $   2,478    $   2,510   $   2,627   $   2,526   $   2,417
  Empty miles percentage............................         12.0%        11.8%       11.9%       11.7%       11.3%
  Average length of haul in miles...................        1,017        1,026       1,001         984         949
  Weighted average tractors during period...........        1,635        1,494       1,142         774         598
  Tractors at end of period.........................        1,693        1,655       1,344         940         623
  Trailers at end of period.........................        2,424        2,455       1,998       1,430         877
<FN>

1    The  Company  was  treated as an S Corporation for federal and state income
     tax purposes from  October 1, 1990  to November 16, 1995.  As a result, the
     Company's taxable earnings for such period were taxed for federal and state
     income tax purposes directly to the  Company's  then-existing stockholders.
     The pro forma statement of earnings data give effect to an adjustment for a
     provision for  federal and  state  income taxes as  if the Company had been
     treated as a C  Corporation during such period.  The pro forma statement of
     operations data  do  not  give  effect  to the one-time, non-cash charge of
     $2,980,115 in recognition of  deferred  income taxes that resulted from the
     termination  of  the  Company's  S  Corporation  status.  The provision for
     income taxes for  fiscal 1996  includes the one-time,  non-cash  charge  of
     $2,980,115.

2    Operating expenses as a percentage of revenue.
</FN>


</TABLE>
<PAGE>
Item 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

Overview

         Simon     Transportation     provides     nationwide,     predominantly
temperature-controlled  truckload transportation for numerous major shippers. In
recent  years,  much of the  Company's  growth has  resulted  from  earning core
carrier status with major shippers and meeting the demands of these shippers for
additional equipment. The Company has grown to $209.1 million in revenue for its
fiscal year ended  September 30, 1999,  from $75.2 million in revenue for fiscal
1995, a compounded  annual growth rate of 29.1%. From fiscal 1995 through fiscal
1997, the Company's  pretax earnings grew to $12.5 million from $2.5 million,  a
compounded  annual  growth rate of 123.6%.  The increase in pretax  earnings was
attributable  primarily to revenue growth, greater equipment  productivity,  and
the reduction in financing costs  attributable  to public  offerings in 1995 and
1997.

         During fiscal 1998, the Company  continued its strong  revenue  growth,
with  revenue   increasing   approximately   25%.  Pretax   earnings   decreased
substantially,  however,  as the Company  experienced  financial  and  operating
difficulties. For much of the year the industry-wide driver shortage contributed
to a  substantial  number of unseated  tractors.  To address this  problem,  the
Company  raised  driver  wages  by a total  of four  cents  per  mile.  Although
management  believes the higher wages have made the Company more  competitive in
attracting and retaining drivers, the combination of unproductive  equipment and
higher wages  adversely  affected the  Company's  profitability.  The  Company's
financial  results also were  affected by  unusually  high  accident  claims and
repair expense during the second fiscal quarter.

         During fiscal year 1999, management deferred deliveries of new tractors
to better match the anticipated  availability  of drivers.  This reduced revenue
growth for the year to 8% compared with historical levels. The Company continued
to experience financial and operating  difficulties due to driver turnover rates
far in excess of  historical  averages  and the fact that  driver pay  increases
effective in fiscal 1998 have not been offset by increases in the freight  rates
charged by the Company.  Management is focusing its efforts on reducing the rate
of driver turnover. In July 1999 the Company reduced its shop and administrative
personnel by approximately 25%.(*)

         In comparing the Company's historical financial position and results of
operations,  readers  should be aware of changes in  financing  methods.  During
fiscal year 1995,  the Company  financed  most of its tractors and trailers with
debt and capitalized leases.  During fiscal years 1996, 1997, 1998 and 1999, the
Company  has  financed  most of its  revenue  equipment  under  operating  lease
arrangements.  Financing equipment with operating leases increases the Company's
operating ratio because the implied interest  component of the lease payments is
reflected  as an  "above-the-line"  operating  expense  rather  than as interest
expense.  The use of  operating  leases  also  affects the  presentation  of the
Statement of Cash Flows.  However,  the method of financing  does not affect net
earnings or net cash flows.  The Company's  operating  ratio may fluctuate  from
time-to-time based upon the method of equipment financing.

         The  Company  operated  as an S  corporation  from  October  1, 1990 to
November 16, 1995. As a result,  the  Company's net taxable  earnings were taxed
directly to the Company's existing  stockholders rather than to the Company. The
pro forma  statement of earnings data  included in the  "Selected  Financial and
Operating  Data" set forth the Company's net earnings for such periods as if the
Company  had been  subject  to  federal  and state  income  taxes at a  combined
effective  rate of 39.6% for fiscal  years  1995 and 1996.  In  addition  to the
ongoing income tax effect, the termination of the Company's S corporation status
resulted in a one-time,  non-cash  charge of  approximately  $3.0 million during
fiscal year 1996 in recognition of deferred income taxes.
<PAGE>
Results of Operations

         The following  table sets forth the percentage  relationship of certain
items to operating revenue for the periods indicated:
<TABLE>
<CAPTION>
                                                                                       Fiscal Years Ended
                                                                                          September 30,
                                                                                ----------------------------------
<S>                                                                             <C>         <C>        <C>
                                                                                  1999        1998       1997
                                                                                ----------- ---------- ----------
Operating revenue..............................................................    100.0%      100.0%     100.0%
Operating expenses:
  Salaries, wages, and benefits................................................      43.5        41.6       39.0
  Fuel and fuel taxes..........................................................      17.8        18.2       19.4
  Operating supplies and expenses..............................................      13.3        13.5       12.4
  Taxes and licenses...........................................................       3.5         3.4        3.3
  Insurance and claims.........................................................       3.2         2.7        2.2
  Communications and utilities.................................................       2.0         2.0        1.6
  Depreciation and amortization................................................       2.1         2.4        3.5
  Rent.........................................................................      16.4        15.0       11.0
                                                                                ----------- ---------- ----------
    Total operating expenses....................................................    101.8        98.9       92.4
                                                                                ----------- ---------- ----------
Operating earnings (loss)......................................................      (1.8)        1.1        7.6
Gain on sale of real property..................................................        --          --        1.2
Interest expense and other, net................................................      (0.6)       (0.8)      (0.7)
                                                                                ----------- ---------- ----------
Earnings (loss) before income taxes............................................      (2.4)        0.3        8.1
Benefit (provision) for income taxes...........................................       0.9        (0.1)      (3.1)
                                                                                ----------- ---------- ----------
Net earnings (loss)............................................................      (1.5)%       0.2%       5.0%
                                                                                =========== ========== ==========

</TABLE>

Comparison  of fiscal  year ended  September  30,  1999,  with fiscal year ended
September 30, 1998.

         Operating  revenue  increased $15.6 million  (8.1%),  to $209.1 million
during the 1999 fiscal year from $193.5 million during the 1998 fiscal year. The
increase  in  revenue  was  primarily  attributable  to a 9.4%  increase  in the
weighted  average number of tractors,  to 1,635 during the 1999 fiscal year from
1,494 during the 1998 fiscal year, and an increase in average revenue per loaded
mile to $1.26  during the 1999 fiscal  year from $1.25 in the 1998 fiscal  year.
This  increase  was  partially  offset by a decrease in the average  revenue per
tractor per week to $2,478  during the 1999  fiscal year from $2,510  during the
1998 fiscal year due to slower than  expected  freight  demand in the  Company's
second  fiscal  quarter and a  significant  number of tractors  without  drivers
throughout much of the fiscal year, particularly the first and fourth quarters.

         Salaries,  wages and benefits increased $10.4 million (12.9%), to $90.9
million in the 1999 fiscal year from $80.5 million in the 1998 fiscal year. As a
percentage of revenue,  salaries,  wages,  and benefits  increased  to 43.5%  of
revenue  during the 1999  fiscal  year from  41.6%  during the 1998 fiscal year.
The  increase  is primarily  attributable  to  the full  effect of the  two-cent
per mile driver wage increases effective April 15, 1998, and excess  non-driving
personnel during most of the 1999 fiscal year. In July 1999, the Company reduced
its shop and  administrative  personnel  by   approximately  25%.   As a result,
management  expects a  decrease  in salaries, wages and benefits as a percentage
of revenue in future periods.(*)

         Fuel and fuel taxes  increased  $2.0 million  (5.6%),  to $37.3 million
in the 1999  fiscal  year  from  $35.3  million  in  the 1998 fiscal year.  As a
percentage of revenue, fuel and fuel taxes  decreased to 17.8% of revenue during
the  1999  fiscal  year  from  18.2% during  the 1998  fiscal year. The decrease
resulted  principally  from lower fuel  prices in the first  three  quarters  of
the 1999 fiscal  year.  A dramatic rise in fuel prices  during the quarter ended
September  30, 1999,  is expected  to  increase  the Company's  fuel  costs as a
percentage of revenue in future periods.(*)

_________________________________
(*) "Forward-looking" statements.
<PAGE>
         Operating supplies and expenses increased $1.7 million (6.6%), to $27.9
million in the 1999 fiscal year from  $26.2  million  in the 1998  fiscal  year.
As a  percentage  of  revenue,  operating  supplies  and  expenses decreased  to
13.3% of revenue  during  the 1999 fiscal year from 13.5% during the 1998 fiscal
year.  The decrease is primarily attributable to the Company's efforts to reduce
the amount spent on operating supplies and expenses.

         Taxes and  licenses  increased  $0.7  million (11.6%),  to $7.3 million
in the 1999 fiscal  year from  $6.6  million  in  the  1998  fiscal  year.  As a
percentage of revenue, taxes and licenses remained essentially  constant at 3.5%
of  revenue  during  the 1999 fiscal year compared to 3.4% of revenue during the
1998 fiscal year.

         Insurance and claims increased  $1.4 million  (26.3%),  to $6.6 million
in  the  1999  fiscal  year  from  $5.2  million  in the 1998 fiscal year.  As a
percentage  of revenue,  insurance  and claims  increased  to  3.2%  of  revenue
for the 1999  fiscal year  compared  to 2.7% during  the 1998 fiscal  year.  The
increase was attributable  to an increase in the number of accidents experienced
by the Company during the 1999 fiscal year.

         Communications  and utilities  increased $0.3 million  (7.4%),  to $4.2
million in the 1999 fiscal year from $3.9  million  in the 1997 fiscal year.  As
a  percentage  of  revenue,  communications  and  utilities  remained  unchanged
at 2.0% of revenue during the 1999 and 1998 fiscal years.

         Depreciation  and amortization  decreased $0.2 million (5.5%),  to $4.5
million in the 1999 fiscal year from $4.7 million in the 1998 fiscal year.  As a
percentage of revenue,  depreciation and amortization (adjusted for the net gain
on sale of equipment)  decreased to 2.1% of revenue  during the 1999 fiscal year
from 2.4%  during the 1998 fiscal  year  primarily  because of a decrease in the
percentage of the Company's  revenue  equipment that was owned or acquired under
capitalized leases.  Depreciation and amortization  (unadjusted for the net gain
on sale of  equipment)  decreased to 3.2% of revenue ($6.6  million)  during the
1999  fiscal  year from 3.6% of revenue  ($7.0  million)  during the 1998 fiscal
year.  Depreciation  was  adjusted  for a $2.1  million  net gain on the sale of
revenue  equipment  during the 1999 fiscal year compared with a $2.3 million net
gain during the 1998 fiscal year.

         Rent  increased  $5.4  million  (18.5%),  to  $34.4 million in the 1999
fiscal year from  $29.0  million  in the 1998 fiscal  year.  As a percentage  of
revenue,  rent  increased  to 16.4% of revenue  during the 1999 fiscal year from
15.0%  during  the  1998 fiscal  year  as the Company  added new  equipment  and
replaced equipment that had been financed under capital lease arrangements  with
equipment  financed under operating  leases.  Substantially all of the Company's
revenue equipment is financed through operating leases.  In addition,  the fixed
monthly  rental payments were not as  efficiently  spread over lower revenue per
tractor.  The Company has utilized operating leases  in  the  most  recent  year
because of more favorable  terms.  If the  Company  continues  to use  operating
lease financing,  its operating ratio may be affected in future periods  because
the implied financing costs of such equipment are included as operating expenses
instead of as interest expense.

         As a result of the foregoing,  the Company's  operating ratio increased
to 101.8% during the 1999 fiscal year from 98.9% during the 1998 fiscal year.

         Interest  expense and other, net decreased $0.1 million (9.8%), to $1.4
million in the 1999 fiscal year from $1.5 million in the 1998 fiscal year. As  a
percentage of revenue,  interest  expense and other,  net decreased slightly  to
0.6% of  revenue  during the 1999 fiscal year compared with 0.8% during the 1998
fiscal year.

         The  Company's effective combined federal and state income tax rate for
the 1999 fiscal  year was 37.8%  compared to 46.8% for the 1998 fiscal year as a
result of the relative impact of  non-deductible  expenses in fiscal 1998. These
non-deductible  expenses remained  essentially constant during both the 1999 and
1998 fiscal years;  however,  the relative effect on the tax rate varies because
of the earnings  experienced in the 1998 fiscal year versus the loss in the 1999
fiscal year.

         As a result of the factors  described  above,  net  earnings  decreased
$3.6  million  to a loss of $3.2 million  during the 1999  fiscal year  from net
earnings of $338,000  during the 1998 fiscal year.  As a percentage  of revenue,
net loss was 1.5% of revenue in the 1999 fiscal year  compared with net earnings
of 0.2% of revenue in the 1998 fiscal year.



<PAGE>
Comparison  of fiscal  year ended  September  30,  1998,  with fiscal year ended
September 30, 1997.

         Operating  revenue  increased $38.2 million (24.6%),  to $193.5 million
during the 1998 fiscal year from $155.3 million during the 1997 fiscal year. The
increase  in revenue  was  primarily  attributable  to a 30.8%  increase  in the
weighted  average number of tractors,  to 1,494 during the 1998 fiscal year from
1,142  during the 1997 fiscal year.  This  increase  was  partially  offset by a
decrease in the average  revenue per tractor per week to $2,510  during the 1998
fiscal year from $2,627 during the 1997 fiscal year due to a substantial  number
of tractors without drivers  throughout most of the year. The Company's  average
revenue per loaded mile remained constant at $1.25 during both the 1998 and 1997
fiscal years.

         Salaries,  wages and benefits increased $20.0 million (33.1%), to $80.5
million in the 1998 fiscal year from $60.5 million in the 1997 fiscal year. As a
percentage of revenue,  salaries,  wages,  and benefits  increased  to  41.6% of
revenue  during the 1998  fiscal  year from 39.0% during  the 1997 fiscal  year.
The  increase  is primarily  attributable to driver wage increases.  In order to
remain  competitive,  the  Company  raised  driver  base  pay two cents per mile
effective  January 1,  1998  and  an  additional  two  cents  per mile effective
April 15, 1998.

         Fuel and fuel taxes  increased $5.2 million  (17.3%),  to $35.3 million
in  the  1998  fiscal  year  from  $30.1  million in the 1997 fiscal year.  As a
percentage of revenue, fuel and fuel taxes  decreased to 18.2% of revenue during
the 1998  fiscal  year  from 19.4%  during  the 1997  fiscal year.  The decrease
resulted  principally  from  lower fuel  prices  in the  1998 fiscal year and an
overall increase in the fuel efficiency of the Company's fleet.

         Operating  supplies  and  expenses  increased  $6.9 million (35.8%), to
$26.2  million  in the 1998 fiscal year from  $19.3  million in the 1997  fiscal
year.  As a percentage of  revenue, operating  supplies  and  expenses increased
to 13.5% of revenue  during  the  1998 fiscal year,  from  12.4% during the 1997
fiscal year.  The increase was attributable primarily to costs  incurred  during
the second fiscal quarter for accident  repairs,  preparing equipment for trade,
and completing work on and opening the Atlanta terminal.

         Taxes and  licenses increased  $1.4  million  (26.9%),  to $6.6 million
in  the  1998  fiscal  year from  $5.2  million  in  the  1997 fiscal year. As a
percentage  of  revenue,  taxes  and licenses remained  essentially  constant at
3.4% of  revenue  during the 1998 fiscal year compared to 3.3% of revenue during
the 1997 fiscal year.

         Insurance and claims  increased  $1.8 million  (52.9%), to $5.2 million
in  the  1998  fiscal  year from  $3.4  million  in  the 1997 fiscal year.  As a
percentage  of revenue,  insurance  and claims  increased to 2.7% of revenue for
the 1998 fiscal year  compared to 2.2% during the 1997 fiscal year.  Most of the
increase  was  attributable  to an  unusually  high  number of severe  accidents
suffered  during the second  fiscal  quarter.  Insurance and claims  returned to
2.2% of revenue during the fourth quarter.(*)

         Communications  and utilities  increased $1.3 million (50.0%),  to $3.9
million in the 1998 fiscal year from $2.6 million in the 1997 fiscal year.  As a
percentage of revenue, communications and utilities increased to 2.0% of revenue
during the 1998  fiscal  year from 1.6% of revenue  during the 1997  fiscal year
primarily  as a result of an access fee  charged to the Company by the owners of
pay telephones based on calls to toll free numbers. In addition, the fixed costs
of utilities for the Company's  terminals and costs associated with the usage of
the Company's  satellite  tracking system did not remain  proportionate with the
decreased revenue per tractor.

         Depreciation  and  amortization  decreased  $700,000  (13.0%),  to $4.7
million in the 1998 fiscal year from $5.4 million in the 1997 fiscal year.  As a
percentage of revenue,  depreciation and amortization (adjusted for the net gain
on sale of equipment)  decreased to 2.4% of revenue  during the 1998 fiscal year

_________________________________
(*) "Forward-looking" statements.

<PAGE>
from 3.5%  during the 1997 fiscal  year  primarily  because of a decrease in the
percentage of the Company's  revenue  equipment that was owned or acquired under
capitalized leases.  Depreciation and amortization  (unadjusted for the net gain
on sale of  equipment)  decreased to 3.6% of revenue ($7.0  million)  during the
1998  fiscal  year from 4.5% of revenue  ($7.0  million)  during the 1997 fiscal
year.  Depreciation  was  adjusted  for a $2.3  million  net gain on the sale of
revenue  equipment  during the 1998 fiscal year compared with a $1.6 million net
gain during the 1997 fiscal year.

         Rent  increased  $11.9  million  (69.6%),  to $29.0 million in the 1998
fiscal year  from $17.1  million in  the 1997 fiscal  year.  As a percentage  of
revenue,  rent  increased  to 15.0% of revenue  during the 1998 fiscal year from
11.0% during  the  1997 fiscal  year as  the  Company  added new  equipment  and
replaced  equipment  that  had  been  financed under capital lease  arrangements
with equipment  financed under operating leases.  The Company utilized operating
leases during the 1998 fiscal year because of more favorable terms.

         As a result of the  foregoing,  the Company's operating ratio increased
to 98.9% during the 1998 fiscal year from 92.4% during the 1997 fiscal year.

         The  Company  realized  a  $1.9  million gain on the sale of its former
headquarters  facilities  during  the  1997  fiscal  year.  This   non-recurring
transaction  increased earnings before  provision  for  income  taxes by 1.2% of
revenue during the 1997 period.

         Interest expense  and other, net increased  $400,000 (36.4%),  to  $1.5
million in the 1998 fiscal year from $1.1  million in the 1997 fiscal  year.  As
a percentage of revenue, interest  expense and other,  net  remained essentially
constant  at  0.8% of revenue  during the 1998 fiscal  year  compared  with 0.7%
during the 1997 fiscal year.

         The  Company's effective combined federal and state income tax rate for
the 1998 fiscal  year was 46.8%  compared to 37.8% for the 1997 fiscal year as a
result of the relative impact of  non-deductible  expenses in fiscal 1998. These
non-deductible  expenses remained  essentially constant during both the 1998 and
1997 fiscal  years;  however,  the relative  effect on the tax rate is magnified
because of the lower earnings experienced in the 1998 fiscal year.

         As a result of the factors described above, net earnings decreased $7.5
million  (96.2%) to $338,000 during the 1998 fiscal year from $7.8 million ($6.6
million  excluding  the gain on the sale of the Company's  former  headquarters)
during the 1997 fiscal year. As a percentage of revenue,  net earnings decreased
to 0.2% of revenue in the 1998 fiscal year from 5.0% (4.2% of revenue  excluding
the gain on the sale of the Company's  former  headquarters)  in the 1997 fiscal
year.


Liquidity and Capital Resources

         The   growth  of  the  Company's  business  has  required   significant
investment in new revenue  equipment that the Company  historically has financed
with  borrowings  under   installment   notes  payable  to  commercial   lending
institutions  and equipment  manufacturers,  equipment  leases from  third-party
lessors,  borrowings  under its line of credit,  and cash flows from operations.
The Company's  primary sources of liquidity are funds provided by operations and
borrowings and leases with financial  institutions and equipment  manufacturers.
During the 1999,  1998 and 1997 fiscal years,  the Company  financed most of its
tractors with operating leases.

         Net cash (used in) provided by operating activities was ($1.6 million),
$4.2 million,  and $7.9 million, for the fiscal years ended  September 30, 1999,
1998,  and  1997,  respectively.  The  Company's  principal  use  of  cash  from
operations  is  to  service  debt  and  leases  incurred to purchase new revenue
equipment and internally  finance accounts  receivable  associated  with  growth
in  the  business.  Accounts receivable increased  $2.6  million, $627,000,  and
$6.4  million for the fiscal  years ended  September 30, 1999,  1998,  and 1997,
respectively.  The average age of the  Company's  accounts  receivable  was  39,
35,  and 41  days  for  the  fiscal  years  ended September 30, 1999, 1998,  and
1997, respectively.
<PAGE>
         Net cash provided by  (used in) investing  activities was $2.5 million,
$2.9  million,  and  ($19.0 million), for  the fiscal years ended  September 30,
1999, 1998, and 1997,  respectively,  and consisted of net purchases of property
and equipment.  The Company expects capital  expenditures (primarily for revenue
equipment  and  satellite  communications  units),   net  of  revenue  equipment
trade-ins, to be approximately $30.2 million in aggregate for fiscal years  2000
and  2001.  The  Company  expects  projected  capital expenditures  to be funded
mostly  with operating leases, borrowings and cash flows from operations.(*)

 .........Net cash (used in) provided by financing activities was ($0.1 million),
($12.1  million),  and $18.3 million,  for the fiscal years ended  September 30,
1999, 1998, and 1997,  respectively.  Primary sources of cash were approximately
$23.0 million in net proceeds from the  Company's  February 1997 stock  offering
and a $10 million  borrowing on the  Company's  line-of-credit.  Primary uses of
cash were net payments on borrowings of $9.5 million,  $14.5 million,  and $20.5
million of principal under the Company's  long-term debt and  capitalized  lease
agreements  for the fiscal  years ended  September  30,  1999,  1998,  and 1997,
respectively.  During fiscal year 1999, the Company  purchased  95,500 shares of
Class A Common  Stock at an average  market price of $5.46 per share for a total
cash outlay of  $522,000.  The  Company  purchased  81,100  shares at an average
market  price of $6.55 per share for a total cash  outlay of  $532,000 in fiscal
1998.

         The maximum amount  committed  under  the  Company's  line of credit at
September 30, 1999  was  $20 million. As of September  30, 1999, the Company had
drawn $10 million  against the line.  The interest rate on the line of credit is
1.75 percent above the 30-day London Interbank  Offered Rate ("LIBOR") in effect
from  time-to-time.  At September 30, 1999,  the Company  had  other outstanding
long-term debt and capitalized lease obligations (including current portions) of
approximately  $11.6  million,  most of  which  comprised  obligations  for  the
purchase of revenue equipment.  As of September 30, 1999,  the Company's  future
commitments  under  noncancelable  operating  leases amounted  to $57.7 million.
See Notes 4, 5 and 6 to Consolidated Financial Statements.

         The Company's working capital at September 30, 1999, 1998, and 1997 was
$17.5  million,  $14.9  million,  and $15.9  million,  respectively.  Management
believes that available  borrowings under the line of credit,  future borrowings
under installment notes payable or lease arrangements for revenue equipment, and
cash flows generated from operations, will allow the Company to continue to meet
its  working  capital  requirements,   anticipated  capital  expenditures,   and
obligations  under debt and  capitalized  and operating  leases at least through
fiscal year 2000.(*)

Inflation

         Inflation  has had a  minimal effect upon the  Company's  profitability
in  recent  years.  Most  of  the Company's  operating  expenses are  inflation-
sensitive,  with inflation  generally  producing  increased  costs of operation.
The  Company  expects  that  inflation  will  affect  its  costs no more than it
affects  those of other truckload carriers.

Seasonality

         The Company  experiences  some seasonal fluctuations in freight volume,
as shipments have  historically decreased during the first calendar quarter.  In
addition,  the Company's  operating  expenses  historically  have been higher in
the winter  months due to decreased fuel  efficiency and  increased  maintenance
costs in colder weather.

_________________________________
(*) "Forward-looking" statements.

<PAGE>
Fuel Availability and Cost

         The  Company  actively  manages  its fuel  costs by  requiring  drivers
to  fuel at  Company  terminals  or, whenever  possible  en  route,  at  service
centers with which the Company has established  volume  purchasing arrangements.
The Company  controls  fuel  purchases  by using  its  proprietary  software and
Qualcomm communications ability to schedule  fueling stops and amounts purchased
based upon fuel prices at locations on drivers' routes. The Company historically
has  been  able  to  pass  through  most  increases  in fuel prices and taxes to
customers in the form of higher rates and fuel surcharges.  The Company has fuel
surcharge  agreements  with a  majority  of  its customers.  However, the recent
increases in fuel prices will not be fully offset by these surcharges.

Year 2000 Compliance

         The Company has  completed  a  review of each of its  core  systems  to
determine year 2000 compliance.  The Company's billing, dispatch, EDI,  fueling,
payroll,  telephone,  vehicle  maintenance,  and  yard  and  equipment inventory
systems and all other  critical  hardware and software  systems were designed to
be year 2000  compliant from  inception.  The  Company  has  also  completed its
review and assessment of the year 2000 compliance  status of its  facilities and
equipment.  All facilities and systems are year 2000 compliant with the possible
exception of  some older  personal  computers.  These  computers  do not perform
date  critical  job functions.  The Company will continue to replace these units
during the normal course of business.(*)

         In April 1999, the Company installed a new mainframe to handle its core
operating systems.  The Company acquired  the new computer as part of its normal
course of business.  The prior  machine  continues to serve as a  backup system.
Both computers,  peripherals  and all operating  software have been  extensively
tested by Company personnel and we believe all are year 2000 compliant.(*)

         The Company relies on Qualcomm to provide the satellite tracking system
necessary to track the location of its equipment,  and  to provide  dispatch and
routing  information  to  its drivers.  The  Company  has been informed that the
software  utilized  by  Qualcomm  and the  Company is fully year 2000 compliant.
The  Company  utilizes Comdata to transmit  payroll  funds to its drivers and to
allow  drivers to purchase  fuel  outside  of the Company's terminal  locations.
The Company has been informed that the software and systems  utilized by Comdata
and the Company is fully year 2000 compliant.  The Company also  interacts  with
many of its vendors through electronic data  interchange  (EDI). The Company has
received   written   assurances  from  its  significant  vendors  and  customers
representing  approximately  70% of its fiscal 1999  revenue  that  they will be
year 2000  compliant.  Although the  Company  is year 2000  compliant in its EDI
applications,  we cannot and do not guarantee  the year 2000  compliance  of our
business partners' systems.(*)

         The Company has incurred  internal  staff costs necessary to review and
further year 2000 compliance of its core operating systems.  Because the systems
were designed to be year 2000  compliant  since  inception,  the costs  have not
had  a  material  effect  on  the  Company's  financial  position  or results of
operations. The Company also incurred additional internal staff time to complete
its compliance  review of non-core systems embedded in facilities and equipment.
These non-core systems include microcontrollers contained in tractor engines and
other components,  refrigeration  units, and terminal  facilities.  The costs of
such  review  were  not incremental  since  they represented the redeployment of
existing information technology resources.(*)

         The  Company  believes  that the most  likely  worse case  scenario  is
the  failure  of some third  party provided  services.  The  Company anticipates
that the risks  related to its core and  non-core  systems will be mitigated  by
ongoing  assessment  and  correction  of  the  systems.   The  primary  risk  to
operations  is  service  disruption  from   third-party  providers  that  supply
satellite  communication,  telephone,  fueling  and  financial  services.    Any
disruption  of these  critical  services  would hinder the Company's  ability to
receive,  process and track  its freight  or communicate  with its customers and
drivers.(*)

_________________________________
(*) "Forward-looking" statements.

<PAGE>
         A failure of the satellite communication system could have a materially
adverse effect on the Company's business and results of operations.  The Company
is relying  on  the  contingency  plan  established  by  Qualcomm to prevent the
interruption of business.  As an additional backup, the Company plans to use its
existing  telephone systems to dispatch its equipment and provide support to its
drivers in the event of a complete  satellite  system failure.  In  the event of
EDI failures  on  the  part  of  our  customers,  the  Company  plans to use its
telephone and facsimile  system to receive load tenders from its customers.  The
Company would switch to paper  invoices  for  its  customers  unable to use EDI.
Management  believes  that the Company's current state of readiness,  the nature
of the Company's  business,  and  the  availability  of  the  contingency  plans
minimizes year 2000 risks.  Management does not foresee significant liability to
third parties if the Company's systems are not year 2000 compliant.(*)

Cautionary Statement Regarding Forward-Looking Statements

         The   Company   may   from   time-to-time    make   written   or   oral
forward-looking   statements.   Written forward-looking statements may appear in
documents filed with the Securities and Exchange Commission,  in press releases,
and in reports to stockholders.  The Private  Securities  Litigation  Reform Act
of  1995  contains  a safe harbor for  forward-looking  statements.  The Company
relies on this safe harbor in making such disclosures.  In connection  with this
"safe  harbor"  provision,  the Company is hereby identifying important  factors
that could cause actual  results to differ  materially  from those  contained in
any forward-looking statement made by or on behalf of the Company.  Factors that
might cause such a difference include, but are not limited to the following:

         Economic  Factors;  Fuel Prices.  Negative  economic  factors  such  as
recessions,  downturns  in  customers'  business  cycles,  surplus  inventories,
inflation,  and  higher  interest  rates  could  impair  the Company's operating
results by decreasing  equipment utilization or increasing  costs of operations.
Increases in fuel prices usually are not fully  recoverable.  Accordingly,  high
fuel  prices  can  have  a  negative  impact  on  the  Company's  profitability.

         Recruitment,   Retention,   and  Compensation  of  Qualified   Drivers.
Competition for drivers  is  intense  in  the trucking  industry.  There is, and
historically  has been,  an  industry-wide shortage of qualified  drivers.  This
shortage  could  force the Company to  significantly  increase the  compensation
it pays to drivers or curtail the Company's growth.

         Resale  of  Used  Revenue  Equipment.  The  Company   historically  has
recognized  a gain on the sale of its revenue  equipment.   The  market for used
equipment  has  experienced   greater  supply  than  demand  in 1998  and  1999.
If  the  resale  value  of the  Company's  revenue  equipment  were to  decline,
the  Company  could  find it necessary  to  dispose  of its  equipment  at lower
prices or retain some of its  equipment  longer,  with a resulting  increase  in
operating expenses.


Item 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The  principal  market  risks  to  which  the  Company  is  exposed are
fluctuation  in fuel prices and interest rates on our debt financing.

         We are not  engaged  in any fuel  hedging  transactions.  Thus,  we are
exposed to  fluctuations  in fuel prices but are not  exposed to any market risk
involving hedging costs.

         The  principal  market  risks (i.e.,  the  risk  of loss  arising  from
adverse changes in market rates and prices) to which we are exposed are interest
rates on our debt  financing.  Our variable  rate debt  consists of a  revolving
line  of  credit,  an  unsecured  term loan and  an equipment  finance term loan
carrying  interest rates tied to LIBOR or the  Eurodollar  rate.  These variable
interest  rates expose us to the risk that interest rates may rise. At September
30, 1999,  assuming  borrowing  equal to the $10.0  million drawn on the line of
credit  and  $4.7  million  on other  outstanding  variable  rate  loans,  a one

_________________________________
(*) "Forward-looking" statements.

<PAGE>
percentage point increase in the LIBOR and Eurodollar rate  would  increase  our
annual  interest  expense  by  approximately  $147,000.   The   balance  of  our
equipment financing  carries  fixed  interest  rates  and  includes  term  notes
payable  and  capitalized  leases  totaling approximately  $7.0  million.  These
fixed  interest  rates expose us to the risk that  interest  rates  may  fall. A
one  percentage  point  decline in  interest  rates  would  have  the  effect of
increasing the premium we pay over market interest rates by one percentage point
or approximately $70,000 annually.


Item 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         The Company's audited financial statements,  including its consolidated
balance  sheets  and  consolidated statements  of  operations,  cash flows,  and
stockholders'  equity,  and notes related  thereto,  are included at pages 24 to
36 of this report.  The supplementary  quarterly financial data for fiscal years
1999 and 1998 follows:

Quarterly Financial Data:

<TABLE>
<S>                                         <C>                <C>              <C>                 <C>
                                                 Fourth             Third             Second             First
                                                 Quarter           Quarter            Quarter           Quarter
                                                  1999              1999               1999              1999
                                            ------------------ ---------------- ------------------- ----------------
Revenue                                         $  53,281         $  53,599          $   49,271         $  52,992
Operating earnings (loss)                            (440)           (1,058)             (2,716)              369
Earnings (loss) before income taxes                  (782)           (1,393)             (3,097)               73
Provision (benefit) for income taxes                 (294)             (527)             (1,171)               27
Net earnings (loss)                                  (486)             (866)             (1,926)               45
Diluted net earnings (loss) per share           $   (0.08)        $   (0.14)         $    (0.32)        $    0.01

                                                 Fourth             Third             Second             First
                                                 Quarter           Quarter            Quarter           Quarter
                                                  1998              1998               1998              1998
                                            ------------------ ---------------- ------------------- ----------------
Revenue                                         $  50,296         $  50,055          $   46,149         $  47,006
Operating earnings (loss)                             945               (90)             (2,105)            3,386
Earnings (loss) before income taxes                   608              (435)             (2,536)            2,997
Provision (benefit) for income taxes                  286              (165)               (959)            1,132
Net earnings (loss)                                   322              (270)             (1,577)            1,864
Diluted net earnings (loss) per share           $    0.05         $   (0.04)         $    (0.25)        $    0.29


</TABLE>


<PAGE>


Item 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
           AND FINANCIAL DISCLOSURE

         No reports on Form 8-K have been filed  within the  twenty-four  months
prior to September 30, 1999,  involving a change of accountants or disagreements
on accounting and financial disclosure.

                                   PART III

Item 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The information  respecting  executive officers and directors set forth
under the captions "Election of Directors - Information Concerning Directors and
Executive   Officers"  and  "Section  16(a)   Beneficial   Ownership   Reporting
Compliance" on pages 2, 3, and 7 of  Registrant's  Proxy  Statement for the 1999
annual  meeting of  stockholders,  which will be filed with the  Securities  and
Exchange  Commission  in  accordance  with  Rule  14a-6  promulgated  under  the
Securities  Exchange  Act of  1934,  as  amended  (the  "Proxy  Statement"),  is
incorporated by reference.


Item 11.   EXECUTIVE COMPENSATION

         The information  respecting executive  compensation set forth under the
caption  "Executive  Compensation"  on pages 5 and 6 of the Proxy  Statement  is
incorporated  herein by reference;  provided,  that the "Compensation  Committee
Report  on  Executive  Compensation"  contained  in the Proxy  Statement  is not
incorporated by reference.


Item 12.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information  respecting  security  ownership of certain  beneficial
owners  and  management  set forth  under the  caption  "Security  Ownership  of
Principal  Stockholders  and  Management"  on page 9 of the Proxy  Statement  is
incorporated herein by reference.


Item 13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information  respecting  certain  relationships and transactions of
management set forth under the captions  "Compensation  Committee Interlocks and
Insider  Participation"  and  "Certain  Transactions"  on  page 4 of  the  Proxy
Statement is incorporated herein by reference.



<PAGE>


                                   PART IV

ITEM 14.   EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)      1.       Financial Statements.
The Company's audited financial  statements are set forth at the following pages
of this report:

                                                                            Page
Consolidated Statement of Financial Position..............................   24
Consolidated Statement of Operations......................................   25
Consolidated Statement of Stockholders' Equity............................   26
Consolidated Statement of Cash Flows......................................   27
Notes to Consolidated Financial Statements................................   28
Report of Independent Public Accountants..................................   37

         2.  Financial Statement Schedules.
Financial statement schedules are not required because all required  information
is included in the financial statements.

(b)      Reports on Form 8-K
There  were no  reports  on Form 8-K  filed  during  the  fourth  quarter  ended
September 30, 1999.

(c)      Exhibits

Number Description
 3.1 + Articles of Incorporation.
 3.2 + Bylaws.
 4.1 + Articles of Incorporation.
 4.2 + Bylaws.
10.1 + Outside Director Stock Option Plan.
10.2 + Incentive Stock Plan.
10.3 + 401(k) Plan.
10.4 # Loan Agreement(Headquarters Loan) dated May 23, 1996 between U.S. Bank of
       Utah and Dick Simon Trucking, Inc.
10.5 * Loan Agreement  (Line of Credit) dated  September 28, 1999 (replaced loan
       agreement  dated  April 29,  1996)  between  U.S. Bank  of Utah and Simon
       Transportation Services Inc.
21   + List of subsidiaries.
23   * Consent of Arthur Andersen LLP, independent public accountants.
27   * Financial Data Schedule.


_______________________________
         + Filed as an exhibit to the  registrant's  Registration  Statement  on
         Form S-1,  Registration No. 33-96876,  effective November 17, 1995, and
         incorporated herein by reference.

         # Filed as an exhibit to the registrant's Quarterly Report on Form 10-Q
         for the period ended June 30, 1996, Commission File No. 0-27208,  dated
         August 9, 1996, and incorporated herein by reference.

         * Filed herewith


<PAGE>



                                  SIGNATURES


Pursuant to the  requirements  of Section 13 or 15(d) of the  Securities  Act of
1934,  the  registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                                              SIMON TRANSPORATION SERVICES, INC.



Date:  December 13, 1999               By:    /s/ Alban B. Lang
       -----------------                      -----------------
                                              Alban B. Lang
                                              Treasurer, Chief Operating Officer
                                              and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  registrant and
in the capacities and on the dates indicated.

<TABLE>
<S>                                        <C>                                               <C>
                Signature                                      Position                               Date
                ---------                                      --------                               ----
/s/ Richard D. Simon                       Chairman of the Board, President, and Chief       December 13, 1999
--------------------------------------
Richard D. Simon                           Executive Officer (principal executive officer)
/s/ Alban B. Lang                          Treasurer, Chief Operating Officer and Chief      December 13, 1999
--------------------------------------
Alban B. Lang                              Financial Officer (principal financial and
                                           accounting officer); Director
/s/ Kelle A. Simon                         Vice President of Maintenance;  Director          December 13, 1999
--------------------------------------
Kelle A. Simon
/s/ A. Lyn Simon                           Vice President of Sales and Marketing; Director   December 13, 1999
--------------------------------------
A. Lyn Simon
/s/ Richard D. Simon, Jr.                  Vice President of Operations; Director            December 13, 1999
--------------------------------------
Richard D. Simon, Jr.
/s/ Sherry L. Bokovoy                      Assistant Secretary/Treasurer; Director           December 13, 1999
--------------------------------------
Sherry L. Bokovoy
/s/ Irene Warr                             Director                                          December 13, 1999
--------------------------------------
Irene Warr

</TABLE>



<PAGE>


                                        SIMON TRANSPORTATION SERVICES INC.

                                   CONSOLIDATED STATEMENT OF FINANCIAL POSITION

<TABLE>
<CAPTION>
                                                       ASSETS
                                                                                            September 30,
                                                                                  ----------------------------------
<S>                                                                               <C>                 <C>
                                                                                        1999             1998
                                                                                  ----------------------------------
Current Assets:
  Cash                                                                               $   8,658,268    $   7,826,365
  Receivables, net of allowance for doubtful accounts
        of $285,000 and $189,000, respectively                                          22,862,685       20,250,931
  Operating supplies                                                                     1,468,216        1,069,095
  Income taxes receivable                                                                1,656,338        2,593,105
  Prepaid expenses and other                                                             2,643,993        2,181,980
  Current deferred income tax asset                                                      1,066,786          762,463
                                                                                  ----------------------------------
        Total current assets                                                            38,356,286       34,683,939
                                                                                  ----------------------------------
Property and Equipment, at cost:
  Land                                                                                   8,387,972        8,589,422
  Revenue equipment                                                                     45,089,385       47,702,977
  Buildings and improvements                                                            18,484,326       18,350,370
  Office furniture and equipment                                                         8,889,433        8,573,389
                                                                                  ----------------------------------
                                                                                        80,851,116       83,216,158
  Less accumulated depreciation and amortization                                       (23,203,536)     (18,598,221)
                                                                                  ----------------------------------
                                                                                        57,647,580       64,617,937
                                                                                  ----------------------------------
Other Assets                                                                               726,140          867,121
                                                                                  ----------------------------------

                                                                                     $  96,730,006    $ 100,168,997
                                                                                  ==================================

                                       LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Current portion of long-term debt                                                  $   7,459,577    $   7,627,142
  Current portion of capitalized lease obligations                                       1,855,675        2,030,988
  Accounts payable                                                                       6,108,118        5,015,049
  Accrued liabilities                                                                    3,419,629        3,188,405
  Accrued claims payable                                                                 1,970,336        1,904,125
                                                                                  ----------------------------------
        Total current liabilities                                                       20,813,335       19,765,709
                                                                                  ----------------------------------
Long-Term Debt, net of current portion                                                  11,718,580        9,102,649
                                                                                  ----------------------------------
Capitalized Lease Obligations, net of current portion                                      589,181        2,444,856
                                                                                  ----------------------------------
Deferred Income Taxes Payable                                                            7,665,063        9,156,843
                                                                                  ----------------------------------

Commitments and Contingencies (Notes 2 and 6)

Stockholders' Equity:
  Preferred stock, $.01 par value,  5,000,000 shares authorized,  none issued                   --               --
  Class A  common  stock,  $.01  par  value,  20,000,000  shares  authorized,
     5,372,683 shares issued                                                                53,727           53,727
  Class B common stock, $.01 par value, 5,000,000 shares authorized, 913,751
     shares issued                                                                           9,138            9,138
  Additional paid-in capital                                                            48,277,256       48,277,256
  Treasury stock, 176,600 and 81,100 shares at cost                                     (1,053,147)        (531,547)
  Retained earnings                                                                      8,656,873       11,890,366
                                                                                  ----------------------------------
        Total stockholders' equity                                                      55,943,847       59,698,940
                                                                                  ----------------------------------
                                                                                     $  96,730,006    $ 100,168,997
                                                                                  ==================================
<FN>

The accompanying notes to consolidated financial statements are
an integral part of this consolidated financial statement.

</FN>
</TABLE>


<PAGE>


                                SIMON TRANSPORTATION SERVICES INC.

                              CONSOLIDATED STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>
                                                                   For the Years Ended September 30,
                                                       ----------------------------------------------------------
<S>                                                    <C>                      <C>                <C>
                                                                 1999               1998                1997
                                                       ----------------------------------------------------------

Operating Revenue                                            $209,143,336       $193,506,902        $155,296,354
                                                       ----------------------------------------------------------
Operating Expenses:
  Salaries, wages, and benefits                                90,875,731         80,499,985          60,504,236
  Fuel and fuel taxes                                          37,261,969         35,280,815          30,068,552
  Operating supplies and expenses                              27,872,046         26,155,797          19,288,560
  Taxes and licenses                                            7,318,915          6,557,109           5,197,086
  Insurance and claims                                          6,591,246          5,216,804           3,404,550
  Communications and utilities                                  4,239,479          3,945,707           2,550,301
  Depreciation and amortization                                 4,466,114          4,728,477           5,396,198
  Rent                                                         34,362,746         28,987,072          17,142,835
                                                       ----------------------------------------------------------
    Total operating expenses                                  212,988,246        191,371,766         143,552,318
                                                       ----------------------------------------------------------
    Operating earnings (loss)                                  (3,844,910)         2,135,136          11,744,036
Other (Expense) Earnings:
  Gain on sale of real property                                        --                 --           1,896,025
  Interest expense                                             (1,471,426)        (1,818,100)         (1,761,939)
  Other, net                                                      117,794            317,644             627,769
                                                       ----------------------------------------------------------
Earnings (loss) before income taxes                            (5,198,542)           634,680          12,505,891
Provision (benefit) for income taxes                           (1,965,049)           296,536           4,727,227
                                                       ----------------------------------------------------------

Net Earnings (Loss)                                          $ (3,233,493)      $    338,144        $  7,778,664
                                                       ==========================================================

Net earnings (loss) per common share
         Basic                                               $      (0.53)      $       0.05        $       1.36
         Diluted                                             $      (0.53)      $       0.05        $       1.33
                                                       ==========================================================
Weighted average common shares outstanding
         Basic                                                  6,116,815          6,270,734           5,707,642
         Diluted                                                6,116,815          6,270,734           5,864,043
                                                       ==========================================================
<FN>

The accompanying notes to consolidated financial statements are
an integral part of this consolidated financial statement.

</FN>
</TABLE>



<PAGE>


                                        SIMON TRANSPORTATION SERVICES INC.

                                  CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

<TABLE>
<S>                             <C>       <C>       <C>           <C>           <C>         <C>
                                Class A   Class B   Additional                                Total
                                Common    Common      Paid-in     Treasury       Retained   Stockholders'
                                  Stock    Stock      Capital       Stock        Earnings      Equity
                                -------------------------------------------------------------------------
   Balance, September 30, 1996  $ 28,705  $ 18,722  $ 25,282,496  $        --   $ 3,773,558 $ 29,103,481

     Sale of 1,535,000 shares     24,445    (9,095)   22,903,411                              22,918,761
      of Class A Common Stock
      in secondary public
      offering, net of
      issuance costs

     Sale of 5,306 shares of          53                  47,701                                  47,754
      Class A Common Stock
      upon exercise of stock
      options

     Net earnings                                                                 7,778,664    7,778,664
                                -------------------------------------------------------------------------
   Balance, September 30, 1997    53,203     9,627    48,233,608           --    11,552,222   59,848,660

     Sale of 48,910 shares of        489      (489)                                                   --
      Class B Common Stock by
      major shareholder

     Sale of 3,460 shares of          35                  43,648                                  43,683
      Class A Common Stock
      upon exercise of stock
      options

     Purchase of 81,100 shares                                       (531,547)                  (531,547)
      of Class A Common Stock

     Net earnings                                                                   338,144      338,144
                                -------------------------------------------------------------------------
   Balance, September 30, 1998    53,727     9,138    48,277,256     (531,547)   11,890,366   59,698,940

     Purchase of 95,500 shares                                       (521,600)                  (521,600)
      of Class A Common Stock

     Net loss                                                                    (3,233,493)  (3,233,493)
                                -------------------------------------------------------------------------
   Balance, September 30, 1999  $  53,727 $  9,138  $ 48,277,256  $(1,053,147)  $ 8,656,873 $ 55,943,847
                                =========================================================================
<FN>

The accompanying notes to consolidated financial statements are
an integral part of this consolidated financial statement.

</FN>
</TABLE>


<PAGE>


                                            SIMON TRANSPORTATION SERVICES INC.

                                           CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                 For the Years Ended September 30,
                                                                       -------------------------------------------------------
<S>                                                                    <C>                  <C>                  <C>
                                                                               1999                1998               1997
                                                                       -------------------------------------------------------
Cash Flows From Operating Activities:
  Net earnings (loss)                                                    $    (3,233,493)   $       338,144      $  7,778,664
  Adjustments to reconcile net earnings (loss) to net cash
    provided by (used in) operating activities:
    Depreciation and amortization                                              4,466,114          4,728,477         5,396,198
    Gain on sale of real property                                                     --                 --        (1,896,025)
    Changes in operating assets and liabilities:
      Increase in receivables, net                                            (2,611,754)          (627,145)       (6,361,812)
      Increase in operating supplies                                            (399,121)          (316,882)         (324,090)
      Decrease (increase) in income taxes receivable                             936,767         (3,224,881)       (1,560,208)
      Increase in prepaid expenses and other                                    (462,013)          (623,057)         (256,431)
      Increase in current deferred income tax asset                             (304,323)          (127,436)           (7,144)
      Decrease (increase) in other assets                                        140,981            (98,373)          192,195
      Increase in accounts payable                                             1,093,069          1,421,629         1,901,521
      Increase (decrease) in accrued liabilities                                 231,224           (136,874)        1,000,361
      Increase (decrease) in accrued claims payable                               66,211              1,153          (342,670)
      (Decrease) increase in deferred income taxes payable                    (1,491,780)         2,902,398         2,373,792
                                                                       -------------------------------------------------------
        Net cash provided by (used in) operating activities                   (1,568,118)         4,237,153         7,894,351
                                                                       -------------------------------------------------------
Cash Flows From Investing Activities:
  Purchase of property and equipment                                         (10,385,759)       (12,936,744)      (31,815,000)
  Proceeds from the sale of property and equipment                            12,890,002         15,833,300        12,785,576
                                                                       -------------------------------------------------------
        Net cash provided by (used in) investing activities                    2,504,243          2,896,556       (19,029,424)
                                                                       -------------------------------------------------------
Cash Flows From Financing Activities:
  Proceeds from issuance of long-term debt                                            --          2,900,000        15,894,391
  Principal payments on long-term debt                                        (7,551,634)        (7,191,295)      (13,198,750)
  Borrowings under line-of-credit agreement                                   10,000,000                 --                --
  Principal payments under capitalized lease obligations                      (2,030,988)        (7,294,186)       (7,332,513)
  Net proceeds from issuance of common stock                                          --             43,683        22,966,515
  Purchase of treasury stock                                                    (521,600)          (531,547)               --
                                                                       -------------------------------------------------------
        Net cash provided by (used in) financing activities                     (104,222)       (12,073,345)       18,329,643
                                                                       -------------------------------------------------------
Net Increase (Decrease) In Cash                                                  831,903         (4,939,636)        7,194,570
Cash at Beginning of Year                                                      7,826,365         12,766,001         5,571,431
                                                                       -------------------------------------------------------
Cash at End of Year                                                      $     8,658,268    $     7,826,365      $ 12,766,001
                                                                       =======================================================
Supplemental Disclosure of Cash Flow Information:
    Cash paid during the year for interest                               $     1,471,426    $     1,818,100      $  1,761,939
    Cash paid during the year for income taxes                                    32,486            153,461         4,631,593

<FN>

The accompanying notes to consolidated financial statements are
an integral part of this consolidated financial statement.

</FN>
</TABLE>

<PAGE>


                        SIMON TRANSPORTATION SERVICES INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1)      DESCRIPTION OF THE COMPANY, ACQUISITIONS, AND RECAPITALIZATION

         Simon Transportation Services Inc. was incorporated in Nevada on August
15, 1995 to acquire all of the outstanding capital stock of Dick Simon Trucking,
Inc., a Utah corporation.  The accompanying  consolidated  financial  statements
present the consolidated  financial  position and results of operations of Simon
Transportation  Services Inc. and Dick Simon  Trucking,  Inc.,  its wholly owned
subsidiary  (collectively,   the  "Company").   All  intercompany  accounts  and
transactions have been eliminated in consolidation.

         The Company is a truckload carrier that specializes in premium service,
primarily through temperature-controlled  transportation predominantly for major
shippers in the U.S. food industry.

Recapitalization

         On  February  13,  1997,  the Company  completed  a public  offering of
2,530,000  shares of Class A Common  Stock.  Selling  stockholders  offered  and
received  net proceeds  for 995,000 of these  shares  (85,500  shares of Class A
Common Stock and 909,500 shares of Class B Common Stock  reclassified as Class A
Common Stock upon completion of the offering).  The sale of the 1,535,000 shares
of Class A Common  Stock  offered  by the  Company  generated  net  proceeds  of
$22,918,761  after deducting  underwriting  commissions  and other  expenses.  A
majority of the proceeds were used to purchase new revenue equipment.

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates in the Preparation of Financial Statements

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

Revenue Recognition and Significant Customers

         Freight  charges and related direct freight  expenses are recognized as
revenue and operating expense when freight is delivered at a destination  point.
One customer  accounted  for  approximately  11, 11, and 12 percent of operating
revenue in fiscal years 1999,  1998,  and 1997,  respectively.  At September 30,
1999,  the  Company  had  accounts  receivable  outstanding  with this  customer
totaling  $1,706,936.  No other customer  accounted for more than 10% of revenue
during fiscal years 1999, 1998 and 1997.

Operating Supplies

         Operating  supplies  consist  primarily of tires,  fuel and maintenance
parts for revenue equipment which are stated at the lower of first-in, first-out
(FIFO) cost or market value.

Property and Equipment

         Property and  equipment are recorded at cost and  depreciated  based on
the  straight-line  method  over  their  estimated  useful  lives,  taking  into
consideration  salvage  values for  purchased  property and residual  values for
equipment held under capitalized  leases.  Leasehold  improvements are amortized
over the terms of the respective lease or the lives of the assets,  whichever is
shorter.

         Expenditures  for  routine  maintenance  and  repairs  are  charged  to
operating  expense as incurred.  Major renewals and  betterments are capitalized
and  depreciated  over their  estimated  useful lives.  Upon retirement or other
<PAGE>
disposition of property and equipment, the cost and accumulated depreciation are
removed from the accounts,  and any gain or loss is recorded as an adjustment to
depreciation  and  amortization.  Net gains from the disposition of equipment in
the amounts of  $2,131,460,  $2,290,074,  and  $1,563,524 for fiscal years 1999,
1998,  and  1997,   respectively,   have  been  included  in  depreciation   and
amortization in the accompanying statements of operations and cash flows.

         The estimated useful lives of property and equipment are as follows:

Revenue equipment                                                    3 - 7 years
Buildings and improvements                                              30 years
Office furniture and equipment                                      5 - 10 years

         Tires purchased as part of revenue  equipment are capitalized as a cost
of the equipment. Replacement tires are expensed when placed in service.

Fair Value of Financial Instruments

         The  carrying  amounts   reported  in  the  accompanying   consolidated
statements of financial  position for cash,  accounts  receivable,  and accounts
payable   approximate  fair  values  because  of  the  immediate  or  short-term
maturities of these financial instruments. The carrying amounts of the Company's
long-term debt also  approximate  fair values based on current rates for similar
debt.

Quantitative and Qualitative Disclosures About Market Risk

         The  principal  market  risks to  which  the  Company  is  exposed  are
fluctuations in fuel prices and interest rates on our debt financing.

         We are not  engaged  in any fuel  hedging  transactions.  Thus,  we are
exposed to  fluctuations  in fuel  prices but are not exposed to any market risk
involving hedging costs.

         The principal market risks (i.e., the risk of loss arising from adverse
changes in market rates and prices) to which we are exposed are  interest  rates
on our debt  financing.  Our variable rate debt consists of a revolving  line of
credit,  an  unsecured  term loan and an equipment  finance  term loan  carrying
interest rates tied to LIBOR or the  Eurodollar  rate.  These variable  interest
rates expose us to the risk that interest rates may rise. At September 30, 1999,
assuming  borrowing  equal to the $10.0  million drawn on the line of credit and
$4.7 million on other  outstanding  variable rate loans, a one percentage  point
increase in the LIBOR and  Eurodollar  rate would  increase our annual  interest
expense  by  approximately  $147,000.  The  balance of our  equipment  financing
carries fixed  interest  rates and includes  term notes payable and  capitalized
leases totaling approximately $7.0 million. These fixed interest rates expose us
to the risk that  interest  rates may fall. A one  percentage  point  decline in
interest  rates  would have the  effect of  increasing  the  premium we pay over
market interest rates by one percentage point or approximately $70,000 annually.

Insurance Coverage and Accrued Claims Payable

         The Company acts as a self-insurer for auto liability, tractor physical
damage,  trailer physical  damage,  and cargo damage claims subject to a "basket
deductible" of $250,000 per occurrence.  The Company acts as a self-insurer  for
workers' compensation claims up to $100,000 per single occurrence.  Liability in
excess of these amounts is assumed by the insurance underwriter up to applicable
policy  limits  of  $1,000,000  per  occurrence.   The  Company  maintains  loss
prevention programs in an effort to minimize this risk.

         The Company estimates and accrues a liability for its share of ultimate
settlements  using all available  information to assist in establishing  reserve
levels  for  each  occurrence  based  on  the  facts  and  circumstances  of the
occurrence  coupled with the Company's past history of such claims.  The Company
accrues for workers'  compensation  and  automobile  liabilities  when reported,
typically the same day as the occurrence.  Additionally,  the Company accrues an
estimated  liability for incurred but not reported claims.  Expense depends upon
actual loss  experience and changes in estimates of settlement  amounts for open
<PAGE>
claims which have not been fully resolved. The Company provides for adverse loss
developments in the period when new information so dictates.

         The  Company had  outstanding  letters of credit  related to  insurance
coverage  totaling  $1,700,000  at September  30, 1999.  These letters of credit
mature  at  various  times  through  November  1999 and  renew  annually  unless
terminated by either party.

Income Taxes

         The  Company  recognizes  a  liability  or asset for the  deferred  tax
consequences  of all temporary  differences  between the tax bases of assets and
liabilities and their reported amounts in the consolidated  financial statements
that will  result in taxable  or  deductible  amounts  in future  years when the
reported amounts of the assets and liabilities are recovered or settled.

Net Earnings (Loss) Per Common Share

         Basic net  earnings  (loss)  per  common  share  (Basic  EPS)  excludes
dilution and is computed by dividing net earnings (loss) by the weighted average
number of common shares outstanding during the fiscal year. Diluted net earnings
(loss) per common share (Diluted EPS) reflects the potential dilution that could
occur if stock options or other  contracts to issue common stock were  exercised
or converted into common stock.  The  computation of Diluted EPS does not assume
exercise or conversion of securities that would have an  antidilutive  effect on
net earnings (loss) per common share.

         Following is a reconciliation of the numerator and denominator of Basic
EPS to the numerator and  denominator of Diluted EPS for fiscal years 1999, 1998
and 1997:


<TABLE>
<S>                                                             <C>              <C>             <C>
                                                                      1999            1998            1997
                                                                ================================================
Numerator:
   Net earnings (loss)                                             $  (3,233,493)   $   338,144     $ 7,778,664
                                                                ================================================
Denominator:
         Weighted average common shares outstanding                    6,116,815      6,270,734       5,707,642
         Effect of options                                                    --             --         156,401
                                                                ================================================
                                                                       6,116,815      6,270,734       5,864,043
                                                                ================================================

Basic EPS                                                          $       (0.53)   $      0.05     $      1.36
Diluted EPS                                                        $       (0.53)   $      0.05     $      1.33
</TABLE>


         Options to purchase  1,008,350  and 717,130  shares of common  stock at
weighted  average  exercise prices of $14.34 and $18.05 as of September 30, 1999
and 1998, respectively, were not included in the computation of Diluted EPS. The
inclusion of the options would have been  antidilutive,  thereby  increasing net
earnings per common share or decreasing net loss per common share.

Segment Reporting

         The Company has adopted SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information." This statement requires disclosures related
to components of a company for which separate financial information is available
that is evaluated  regularly by the Company's chief operating  decision maker in
deciding how to allocate resources and assess  performance.  Management believes
that the Company has only one operating segment in accordance with SFAS No. 131.




<PAGE>


(3)      INCOME TAXES

         The  provision  (benefit)  for  income  taxes  includes  the  following
components for the years ended September 30, 1999, 1998 and 1997:

<TABLE>
<S>                                                           <C>                <C>                 <C>
                                                                     1999               1998               1997
                                                              ---------------------------------------------------------
         Current income tax provision (benefit):
                  Federal                                       $       (333,900)     $  (2,100,924)     $   1,993,941
                  State                                                  164,957           (377,502)           366,638
                                                              ---------------------------------------------------------
                                                                        (168,943)        (2,478,426)         2,360,579
                                                              ---------------------------------------------------------
         Deferred income tax provision (benefit):
                  Federal                                             (1,331,839)         2,352,293          2,062,976
                  State                                                 (464,267)           422,669            303,672
                                                              ---------------------------------------------------------
                                                                      (1,796,106)         2,774,962          2,366,648
                                                              ---------------------------------------------------------

         Provision (benefit) for income taxes                   $     (1,965,049)     $     296,536      $   4,727,227
                                                              =========================================================
</TABLE>

         The following is a reconciliation  between the statutory Federal income
tax rate of 34 percent and the  effective  rate which is derived by dividing the
provision  (benefit) for income taxes by earnings (loss) before income taxes for
the years ended September 30, 1999, 1998 and 1997:

<TABLE>
<S>                                                           <C>                 <C>                <C>
                                                                     1999               1998               1997
                                                              ---------------------------------------------------------
         Computed "expected" provision (benefit)
              for income taxes at the statutory rate              $  (1,767,504)     $      215,791      $   4,252,003
         Increase (decrease) in income taxes
              Resulting from:
                  State income taxes, net of federal income
                      tax benefit                                      (197,545)             24,118            479,466
                  Other, net                                                  --             56,627             (4,242)
                                                              ---------------------------------------------------------

         Provision (benefit) for income taxes                     $  (1,965,049)     $      296,536      $   4,727,227
                                                              =========================================================
</TABLE>

         The  significant  components of the net deferred  income tax assets and
liabilities as of September 30, 1999 and 1998 are as follows:

<TABLE>
<S>                                                                 <C>                <C>
                                                                          1999               1998
                                                                    ------------------ ------------------
         Deferred income tax assets:
              Accrued claims payable                                  $       397,259    $       279,270
              Other reserves and accruals                                     669,527            483,193
                                                                    ------------------ ------------------

         Total deferred income tax assets                                   1,066,786            762,463
                                                                    ------------------ ------------------

         Deferred income tax liabilities:
              Difference between book and tax basis
                  of property and equipment                                (9,557,866)        (9,156,843)
              AMT credit carryforward                                       1,017,279                 --
              Federal net operating loss carryforward                         396,533                 --
              State net operating loss carryforward                           478,991                 --
                                                                    ------------------ ------------------

         Total deferred income tax liabilities                             (7,665,063)        (9,156,843)
                                                                    ------------------ ------------------

         Net deferred income tax liabilities                          $    (6,598,277)   $    (8,394,380)
                                                                    ================== ==================
</TABLE>
<PAGE>
(4)      LONG-TERM DEBT

Long-term debt consists of the following as of September 30, 1999 and 1998:

<TABLE>
<S>                                                                             <C>                <C>
                                                                                     1999               1998
                                                                                ------------------------------------
Notes payable to a bank, interest ranging from 6.24 percent to 7.20 percent,        $  4,507,051       $  7,281,476
       payable in monthly installments through April 2001, secured by revenue
       equipment
Note payable to a bank, interest based on Eurodollar rate (6.19 percent at             4,022,222          8,410,101
       September 30, 1999), payable in monthly installments through August
       2000, unsecured
Note payable to a bank, interest based on Eurodollar rate (6.39 percent at               648,884          1,038,214
       September 30, 1999), payable in monthly installments through May 2001,
       secured by revenue equipment
Line of credit payable to a bank, interest based on Eurodollar rate (7.14             10,000,000                 --
       percent at September 30, 1999),  interest payable monthly,  principle due
       September 2002, secured by accounts receivable (see description below)
                                                                                ------------------------------------
                                                                                      19,178,157         16,729,791
         Less current portion                                                         (7,459,577)        (7,627,142)
                                                                                ------------------------------------
                                                                                    $ 11,718,580       $  9,102,649
                                                                                ====================================
</TABLE>

         Scheduled principal payments of long-term debt as of September 30, 1999
are as follows:

             Years Ending September 30,                           Amount
------------------------------------------------------      -------------------
                        2000                                     $   7,459,577
                        2001                                         1,718,580
                        2002                                        10,000,000
                                                            -------------------
                                                                 $  19,178,157
                                                            ===================


         The Company  has a secured  line of credit  that  provides  for maximum
borrowings of  $20,000,000  with a bank through  September 30, 2002.  Borrowings
under the line of credit are secured with accounts receivable and are limited to
a portion of the book value of accounts  receivable.  As of September  30, 1999,
the Company had drawn  $10,000,000  on this line of credit,  had  $1,700,000  of
outstanding  letters of credit,  and had  $3,906,181 of additional  availability
under the agreement.

         Certain of the Company's  long-term  debt  agreements  contain  various
restrictive  covenants  including maximum debt to tangible net worth and minimum
tangible net worth  requirements.  As of September 30, 1999,  the Company was in
compliance with all covenants under the loan agreements.


<PAGE>
(5)      CAPITALIZED LEASE OBLIGATIONS

         Certain   revenue   equipment   is  leased  under   capitalized   lease
obligations.  The  following  is a summary of assets  held under  capital  lease
agreements:

                                                  September 30,
                                  ----------------------------------------------
                                           1999                   1998
                                  ----------------------------------------------

Revenue equipment                     $  5,987,377           $  9,114,812
Less accumulated amortization           (2,514,305)            (3,884,564)
                                  ----------------------------------------------
                                      $  3,473,072           $  5,230,248
                                  ==============================================


         The following is a schedule by year of future  minimum  lease  payments
under  capitalized  leases  together with the present value of the minimum lease
payments at September 30, 1999:

            Years Ending September 30,                       Amount
---------------------------------------------------    --------------------
                       2000                                   $  1,999,424
                       2001                                        596,850
                                                       --------------------
Total minimum lease payments                                     2,596,274
Less amount representing interest                                 (151,418)
                                                       --------------------
Present value of minimum lease payments                          2,444,856
Less current portion                                            (1,855,675)
                                                       --------------------
                                                              $    589,181
                                                       ====================


(6)      COMMITMENTS AND CONTINGENCIES

Operating Leases

         The Company is committed under noncancelable operating leases involving
certain revenue equipment.  Rent expense for noncancelable  operating leases was
$31,767,339, $25,343,111, and $15,595,123 for fiscal years 1999, 1998, and 1997,
respectively.  Aggregate future lease commitments are $26,360,171,  $19,488,708,
$9,495,805,  $2,176,144,  and $183,239 for the years ending  September 30, 2000,
2001, 2002, 2003, and 2004, respectively.

Orders for Revenue Equipment

         As of  September  30,  1999,  the Company had placed  orders for fiscal
years 2000 and 2001 to purchase revenue equipment at an estimated total purchase
price of $82.5 million.  The revenue  equipment is to be delivered during fiscal
years 2000 and 2001.  Approximately  $52.3 million of the new revenue  equipment
will be used to replace  older  revenue  equipment  and the  balance  represents
incremental  additions to the Company's  fleet.  These orders may be canceled by
the Company without penalty upon written  notification any time prior to 85 days
before the revenue equipment's scheduled delivery.

Legal Proceedings

         The Company and certain of its officers and  directors  have been named
as defendants in a securities  class action filed in the United States  District
Court for the District of Utah, Caprin v. Simon Transportation  Services,  Inc.,
et al.,  No.  2:98CV 863K (filed  December 3, 1998).  Plaintiffs  in this action
allege that defendants made material misrepresentations and omissions during the
period  February  13, 1997  through  April 2, 1998 in  violation of Sections 11,
12(2) and 15 of the  Securities  Act of 1933 and Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.

         The Company intends to vigorously defend this action.  While management
believes,  after  discussion  with legal  counsel and its Directors and Officers
Insurance  carrier,  that the  ultimate  outcome of this  matter will not have a
<PAGE>
significant   effect  on  the  Company's   financial  position  and  results  of
operations,  it is possible that a change in the Company's  estimate of probable
liability could occur.

         The Company from time to time is a party to  litigation  arising in the
ordinary course of its business,  substantially all of which involves claims for
personal injury and property damage incurred in the  transportation  of freight.
Management is not aware of any claims or threatened claims that reasonably would
be expected to exceed insurance limits or have a materially  adverse effect upon
the Company's results of operations or financial position.


(7)      CAPITAL TRANSACTIONS AND STOCK PLANS

Preferred Stock

         The Company is authorized to issue 5,000,000  shares of preferred stock
from time to time in one or more series without stockholder  approval. No shares
of  preferred  stock  are  presently  outstanding.  The  Board of  Directors  is
authorized,  without any further action by the  stockholders of the Company,  to
(a) divide the preferred stock into series,  (b) designate each such series, (c)
fix and determine dividend rights, (d) determine the price, terms and conditions
on which shares of preferred  stock may be redeemed,  (e)  determine  the amount
payable to holders of preferred  stock in the event of voluntary or  involuntary
liquidation,  (f) determine any sinking fund  provisions,  and (g) establish any
conversion privileges.

Treasury Stock

         The Company's Board of Directors  authorized a stock repurchase program
under which management may reacquire up to 500,000 shares of the Company's Class
A Common  Stock.  During  fiscal  years 1999 and 1998,  the Company  repurchased
95,500 and 81,100  shares of Class A Common Stock,  respectively,  at an average
price of $5.96 per  share,  for a total  cash  outlay of  $1,053,147.  The stock
repurchase program expired September 30, 1999.

Incentive Stock Plan

         On May 31, 1995,  the  Company's  Board of Directors  and  stockholders
approved and adopted the Dick Simon  Trucking,  Inc.  Incentive  Stock Plan (the
"Plan"). The Plan reserves 1,000,000 shares of Class A Common Stock for issuance
thereunder.  The Board of Directors or its designated committee  administers the
Plan and has the  discretion  to determine  the  employees and officers who will
receive awards, the type of awards (incentive stock options, non-statutory stock
options,  restricted stock awards, reload options, other stock based awards, and
other  benefits)  to be granted and the term,  vesting  provisions  and exercise
prices.

Non-Officer Incentive Stock Plan

         On December 18, 1998,  the  Company's  Board of Directors  approved and
adopted the Simon Transportation  Services Inc. 1998 Non-Officer Incentive Stock
Plan (the "1998 Plan").  The 1998 Plan reserves 400,000 shares of Class A Common
Stock  for  issuance  thereunder.  The  Board  of  Directors  or its  designated
committee administers the Plan and has the discretion to determine the employees
who  will  receive  awards,   the  type  of  awards  (incentive  stock  options,
non-statutory  stock options,  restricted  stock awards,  reload options,  other
stock based  awards,  and other  benefits)  to be granted and the term,  vesting
provisions and exercise prices.

Outside Director Stock Plan

         On August 16, 1995, the Company adopted an Outside Director Stock Plan,
under which each  director who is not an employee of the Company will receive an
annual option to purchase 1,000 shares of the Company's  Class A Common Stock at
85% of the market  price at the grant  date.  The Company  has  reserved  25,000
shares of Class A Common Stock for  issuance  under the Outside  Director  Stock
Plan.
<PAGE>



         The following  table  summarizes the combined stock option activity for
all plans for fiscal years 1997, 1998 and 1999:

<TABLE>
<S>                                                                      <C>             <C>                  <C>
                                                                                                               Weighted Average
                                                                           Number of                          Exercise Price Per
                                                                            Options          Price Range             Share
                                                                         --------------- -------------------- --------------------

Outstanding at September 30, 1996                                               227,700     $           9.00    $            9.00
         Granted                                                                141,000        13.70 - 16.00                15.97
         Exercised                                                               (5,306)                9.00                 9.00
         Forfeited                                                              (14,160)                9.00                 9.00
                                                                         --------------- -------------------- --------------------

Outstanding at September 30, 1997                                               349,234         9.00 - 16.00                11.79
         Granted                                                                386,500        14.50 - 23.50                23.26
         Exercised                                                               (3,460)                9.00                 9.00
         Forfeited                                                              (15,144)        9.00 - 16.00                 9.18
                                                                         --------------- -------------------- --------------------

Outstanding at September 30, 1998                                               717,130         9.00 - 23.50                18.05
         Granted                                                                373,000         4.25 -  5.50                 5.50
         Exercised                                                                   --                   --                   --
         Forfeited                                                              (81,780)        5.50 - 16.00                 6.74
                                                                         --------------- -------------------- --------------------

Outstanding at September 30, 1999                                             1,008,350     $   4.25 - 23.50    $           14.34
                                                                         =============== ==================== ====================
</TABLE>


         The  weighted  average fair value of options  granted  during the years
ended  September  30,  1999,  1998  and  1997  was  $3.23,   $10.12  and  $6.97,
respectively.  A summary of the options  outstanding and options  exercisable at
September 30, 1999 is as follows:


<TABLE>
<CAPTION>
                           Options Outstanding                                           Options Exercisable
------------------------------------------------------------------------------ --------------------------------------
<S>                  <C>                <C>                 <C>                <C>                <C>
                                         Weighted Average
 Range of Exercise        Options           Remaining       Weighted Average        Options        Weighted Average
      Prices            Outstanding      Contractual Life    Exercise Price       Exercisable       Exercise Price
-------------------- ------------------ ------------------- ------------------ ------------------ -------------------
$  4.25 -  5.50            310,000         9.23 years          $     5.49                --         $         --
   5.51 - 15.00            177,850         5.65 years                9.10           141,980                 9.08
  15.01 - 20.00            140,500         7.19 years               16.05            57,100                16.13
  20.01 - 23.50            380,000         8.22 years               23.38            77,000                23.38
==================== ================== =================== ================== ================== ===================
$  4.25 - 23.50          1,008,350         7.93 years          $    14.34           276,080         $      14.52
==================== ================== =================== ================== ================== ===================

</TABLE>

Stock-Based Compensation

         The Company has  elected to  continue  to apply  Accounting  Principles
Board  Opinion  No.  25  and  related  interpretations  in  accounting  for  its
stock-based  compensation plans as they relate to employees and directors.  SFAS
No.  123,  "Accounting  for  Stock-Based   Compensation,"   requires  pro  forma
information  regarding  net earnings  (loss) as if the Company had accounted for
its stock options granted to employees and directors subsequent to September 30,
1995 under the fair value  method of SFAS No. 123. The fair value of these stock
options was estimated at the grant date using the  Black-Scholes  option pricing
model with the following assumptions: average risk-free interest rates of 4.79%,
5.77%, and 6.15% in fiscal years 1999, 1998 and 1997,  respectively,  a dividend
yield of 0%, weighted  average  volatility  factors of the expected common stock
price of 54.9% for fiscal  year 1999,  24.6% for fiscal  year 1998 and 25.4% for
fiscal year 1997, and weighted  average  expected lives for the stock options of
approximately 8.0 years for fiscal year 1999, 7.4 years for fiscal year 1998 and
9.7 years for fiscal  year 1997.  For  purposes  of pro forma  disclosures,  the
estimated  fair value of the stock options is amortized  over the vesting period
<PAGE>
of the respective  stock  options.  Under the fair value method of SFAS No. 123,
pro forma net (loss)  earnings  would have been  ($4,329,975),  ($479,122),  and
$7,618,831,  and pro forma diluted net (loss) earnings per share would have been
($0.71), ($0.08), and $1.30 for the fiscal years ended September 30, 1999, 1998,
and 1997, respectively.

 (8)     EMPLOYEE BENEFIT PLAN

         The  Company has adopted a defined  contribution  plan,  the Dick Simon
Trucking, Inc. 401(k) Profit Sharing Plan (the "401(k) Plan"). All employees who
have  completed  one year of service  and have  reached  age 21 are  eligible to
participate in the 401(k) Plan. Under the 401(k) Plan,  employees are allowed to
make contributions of up to 15 percent of their annual compensation; the Company
may make  matching  contributions  equal to a  discretionary  percentage,  to be
determined by the Company, of the employee's salary reductions.  The Company may
also make additional discretionary contributions to the 401(k) Plan. All amounts
contributed  by a  participant  are fully vested at all times.  The  participant
becomes 20 percent vested in any matching or discretionary  contributions  after
two years of service. This vesting percentage increases to 100 percent after six
years of  service.  During  fiscal  years  1999,  1998,  and 1997,  the  Company
contributed $320,438, $351,829, and $301,078, respectively, to the 401(k) Plan.



(9)      QUARTERLY FINANCIAL DATA (UNAUDITED)

<TABLE>
<S>                                         <C>                <C>              <C>                 <C>
                                                 Fourth             Third             Second             First
                                                 Quarter           Quarter            Quarter           Quarter
                                                  1999              1999               1999              1999
                                            ------------------ ---------------- ------------------- ----------------
Revenue                                             $ 53,281         $ 53,599            $ 49,271          $ 52,992
Operating earnings (loss)                               (440)          (1,058)             (2,716)              369
Earnings (loss) before income taxes                     (782)          (1,393)             (3,097)               73
Provision (benefit) for income taxes                    (294)            (527)             (1,171)               27
Net earnings (loss)                                     (486)            (866)             (1,926)               45
Diluted net earnings (loss) per share               $  (0.08)        $  (0.14)           $  (0.32)         $   0.01

                                                 Fourth             Third             Second             First
                                                 Quarter           Quarter            Quarter           Quarter
                                                  1998              1998               1998              1998
                                            ------------------ ---------------- ------------------- ----------------
Revenue                                             $ 50,296         $ 50,055            $ 46,149          $ 47,006
Operating earnings (loss)                                945              (90)             (2,105)            3,386
Earnings (loss) before income taxes                      608             (435)             (2,536)            2,997
Provision (benefit) for income taxes                     286             (165)               (959)            1,132
Net earnings (loss)                                      322             (270)             (1,577)            1,864
Diluted net earnings (loss) per share               $   0.05         $  (0.04)           $  (0.25)         $   0.29


</TABLE>


<PAGE>



                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To Simon Transportation Services Inc.:

         We have audited the  accompanying  consolidated  statement of financial
position  of Simon  Transportation  Services  Inc.  (a Nevada  corporation)  and
subsidiary  as of  September  30, 1999 and 1998,  and the  related  consolidated
statements of operations,  stockholders'  equity, and cash flows for each of the
three years in the period ended September 30, 1999.  These financial  statements
are the  responsibility of the Company's  management.  Our  responsibility is to
express an opinion on these financial statements based on our audits.

         We conducted our audits in accordance with generally  accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

         In our opinion,  the  financial  statements  referred to above  present
fairly, in all material respects, the financial position of Simon Transportation
Services Inc. and  subsidiary as of September 30, 1999 and 1998, and the results
of their  operations  and their  cash  flows for each of the three  years in the
period ended September 30, 1999 in conformity with generally accepted accounting
principles.

/s/ Arthur Andersen LLP

Salt Lake City, Utah
October 15, 1999