UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2000
or
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission File Number: 33-9218
Air Brook Airport Express, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 22-2742564
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
115 West Passaic Street, Rochelle Park, New Jersey 07662
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(Address of principal executive offices) (Zip Code)
(201) 843-6100
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(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) has filed all reports required to be filed by
section 13 or 15 (d) of the Exchange Act during the past 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 |_|
APPLICABLE ONLY TO CORPORATE ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes |_| No |_|
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: 2,014,500 Shares as of January 31,
2000.
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY INDEX
PART I - FINANCIAL INFORMATION:
ITEM 1 - FINANCIAL STATEMENTS
Consolidated Balance Sheets (Unaudited) January 31, 2000
and October 31, 1999 1
Consolidated Statements of Income (Unaudited) for the
Three Months Ended January 31, 2000 and 1999 2
Consolidated Statement of Changes In Stockholders' Deficit
(Unaudited) for the Three Months Ended January 31, 2000 3
Consolidated Statements of Cash Flows (Unaudited) for the
Three Months Ended January 31, 2000 and 1999 4
Notes to Consolidated Financial Statements (Unaudited) 5-6
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 7
PART II - OTHER INFORMATION 8
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(Unaudited)
January 31, October 31,
2000 1999
---- ----
<S> <C> <C>
ASSETS
Current assets:
Cash $ 279 $ 323
----------- -----------
Total current assets 279 323
Deposits 650 650
----------- -----------
Total assets $ 929 $ 973
----------- -----------
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable $ 204,913 $ 204,913
Accrued expenses 1,939 2,214
Due to affiliate 735,651 730,473
----------- -----------
Total current liabilities 942,503 937,600
----------- -----------
Stockholders' deficit:
Common stock, $.0001 par value: 98,800,000 shares authorized;
2,014,500 issued and outstanding 201 201
Preferred stock, $.0001 par value:
1,200,000 shares authorized; none issued
Additional paid-in capital 202,936 202,936
Accumulated deficit (1,144,711) (1,139,764)
----------- -----------
Total stockholders' deficit (941,574) (936,627)
----------- -----------
Total liabilities and stockholders' deficit $ 929 $ 973
----------- -----------
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
-1-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED JANUARY 31,
(UNAUDITED)
2000 1999
---- ----
Revenue $ 17,653 $ 17,537
General, administrative and operating expenses $ 5,100 $ 1,417
Non-recurring accounting expenses 17,500 --
----------- -----------
Net income/(loss) $ (4,947) $ 16,120
=========== ===========
Income/(loss) per common equivalent share:
Net income/(loss) $ .00 $ .01
=========== ===========
Weighted average number of common shares outstanding:
Primary 2,014,500 2,014,500
=========== ===========
See accompanying notes to consolidated financial statements (unaudited).
-2-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
FOR THE THREE MONTHS ENDED JANUARY 31, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
Common Stock Additional Total
------------ Paid-in Accumulated Stockholders'
Shares Amount Capital deficit deficit
------ ------ ------- ------- -------
<S> <C> <C> <C> <C> <C>
Balances at November 1, 1999 2,014,500 $ 201 $ 202,936 $(1,139,764) $ (936,627)
Net loss for the three months ended
January 31, 2000 ~ ~ ~ (4,947) (4,947)
----------- ----------- ----------- ----------- -----------
Balance at January 31, 2000 2,014,500 $ 201 $ 202,936 $(1,144,711) $ (941,574)
=========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
-3-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JANUARY 31,
(UNAUDITED)
<TABLE>
<CAPTION>
2000 1999
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income/(loss) $ (4,947) $ 16,120
Adjustments to reconcile net income to net cash consumed by operating
activities:
Changes in assets and liabilities:
Decrease in accounts payable and accrued expenses (275) --
Increase/(decrease) in amount due to affiliate 5,178 (16,163)
-------- --------
Net cash consumed by operating activities (44) (43)
CASH FLOWS FROM INVESTING ACTIVITIES -- --
CASH FLOWS FROM FINANCING ACTIVITIES -- --
-------- --------
Decrease in cash (44) (43)
Cash, beginning of period 323 346
-------- --------
Cash, end of period $ 279 $ 303
</TABLE>
See accompanying notes to consolidated financial statements (unaudited).
-4-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
JANUARY 31, 2000
NOTE 1 - GENERAL
The accompanying unaudited financial statements have been prepared
in accordance with generally accepted accounting principles for
interim financial information and with instructions to Form 10-QSB.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, the
interim financial statements include all adjustments necessary in
order to make the financial statements not misleading. The results
of operations for the three months ended January 31, 2000 are not
necessarily indicative of the results to be expected for the full
year. These statements should be read in conjunction with the
financial statements and notes that are included in the Company's
annual report Form 10-KSB.
NOTE 2 - GOING CONCERN UNCERTAINTY
The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going concern.
As shown in the consolidated financial statements, the Company had a
material working capital deficiency and an accumulated deficit at
January 31, 2000. Additionally, the Company receives significant
financial support from an affiliated entity, Air Brook Limousine,
Inc. ("Air Limo") pursuant to agreements. Such support is essential
to the Company's continuance.
These factors raise substantial doubt about its ability to continue
as a going concern. The financial statements do not include
adjustments relating to the recoverability of assets and
classification of liabilities that might be necessary should the
Company be unable to continue in operation.
The Company's present plans, the realization of which cannot be
assured, to overcome these difficulties include but are not limited
to the continuing effort to investigate business acquisition and
merger opportunities.
NOTE 3 - RELATED PARTY TRANSACTIONS
a. Pursuant to two 1991 agreements, the Company's subsidiary, A.B. Park
and Fly, Inc. ("Abex") transferred all of its transportation
equipment and operating activities of a ground transportation
facility in Ridgewood, New Jersey to its affiliate, Air Limo. Air
Limo in return has agreed to pay Abex a fee equal to ten percent
(10%) of gross collections for such facility.
b. On May 1, 1993, Abex entered into an agreement with Air Limo whereas
Air Limo opened and operates a second satellite terminal in the
Borough of Montvale. Pursuant to the agreement, Air Limo bears all
costs of operating the facility and pays Abex three percent (3%) of
the gross receipts generated by the facility.
c. On August 10, 1993, the Company entered into an agreement with Air
Limo under which Air Limo will continue to advance funds on behalf
of the Company and its subsidiary as long as Air Limo deems
necessary and as long as Air Limo is financially able. Such advances
are due on demand and Air Limo may terminate the agreement at any
time.
d. The Company's principal offices are in a building owned by its
president. The Company occupies these offices on a month to month
basis, free of charge.
-5-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
JANUARY 31, 2000
NOTE 4 - DUE TO AFFILIATE
Air Limo has advanced a net total of $735,651 and $730,473, as of
January 31, 2000 and October 31, 1999, respectively, directly to or
on behalf of Abex to fund operations and liquidate liabilities. Such
advances bear no interest and are payable on demand.
NOTE 5 - NON-RECURRING EVENTS
During January, 2000 a $17,500 liability was paid by Air Limo on
behalf of the Company. This amount was incurred for professional
accounting services required to update company reporting in
compliance with SEC reporting. This non-recurring expense is
included as a separate item on the statement of income.
NOTE 6 - COMMITMENT AND CONTINGENCIES
a. Litigation
None
b. Dependence on Affiliate
Air Limo advances funds on behalf of the Company and its subsidiary
to finance day to day operations. This agreement could be terminated
at any time by Air Limo, and these advances are due on demand. In
addition, all Company revenue comes from commissions on revenue of
the two facilities operated by Air Limo.
c. Dependence on Lease Terms
The Ridgewood terminal, which is operated by Air Limo, is leased by
Abex from the Village of Ridgewood, New Jersey. This facility
produced 89% of Company revenue during the year ended October 31,
1999. The initial lease term expired January 1, 1999; it allows six
renewal options for one year terms.
The lease term of Montvale facility ends in January 2001.
-6-
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Three months ended January 31, 2000 compared to three months ended
January 31, 1999
Pursuant to an agreement signed on February 4, 1991, the Company
transferred all of its operating activities for its satellite
terminal located in Ridgewood, New Jersey and, on July 1, 1991 its
transportation equipment, to Air Brook Limousine, Inc. ("Air Limo").
Air Limo in return pays the Company a fee equal to ten percent (10%)
of gross collections from such terminal.
On May 1, 1993, the Company entered into an agreement with Air Limo
in which Air Limo agreed to open and operate a second satellite
terminal located in the borough of Montvale, New Jersey. Pursuant to
the agreement, Air Limo bears all costs of operating such terminal
and pays the Company three percent (3%) of Air Limo's gross receipts
from such terminal.
On August 10, 1993, the Company entered into an agreement with Air
Limo which stipulates that Air Limo will fund the Company's
operations for as long as Air Limo deems necessary and as long as
Air Limo is financially able. Such advances are due on demand. Air
Limo may terminate such agreement at any time at its own discretion.
In conjunction with such agreements, the Registrant has generated
revenue of $17,653 and $17,537 for the three months ended January
31, 2000 and 1999, respectively.
During January, 2000 a $17,500 liability was paid by Air Limo on
behalf of the Company. This amount was incurred for professional
accounting services required to update company reporting in
compliance with SEC reporting. This non-recurring expense is
included as a separate item on the statement of income.
For the three months ended January 31, 2000, the Company has
generated a net loss in the amount of $4,947, including the
non-recurring accounting charge of $17,500 noted above, whereas for
the three months ended January 31, 1999 the Company generated net
income in the amount of $16,120.
-7-
<PAGE>
AIR BROOK AIRPORT EXPRESS, INC. AND SUBSIDIARY
PART II - OTHER INFORMATION
ITEM 1 - Legal Proceedings:
None
ITEM 2 - Changes in Securities:
None
ITEM 3 - Defaults Upon Senior Securities:
None
ITEM 4 - Submission of Matters to a Vote of Security Holders:
None
ITEM 5 - Other Information:
None
ITEM 6 - Exhibits and Reports on Form 8-K:
None
-8-
<PAGE>
FORM 10-QSB
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Air Brook Airport Express, Inc.
-------------------------------
(Registrant)
March 8, 2000 Donald M. Petroski
- ---------------------- ------------------
Date Donald M. Petroski,
President, Director and Chief
Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-2000
<PERIOD-START> NOV-01-1999
<PERIOD-END> JAN-31-2000
<CASH> 279
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 279
<PP&E> 650
<DEPRECIATION> 0
<TOTAL-ASSETS> 929
<CURRENT-LIABILITIES> 942,503
<BONDS> 0
0
0
<COMMON> (941,574)
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 929
<SALES> 17,653
<TOTAL-REVENUES> 17,653
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 22,600
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (4,947)
<INCOME-TAX> 0
<INCOME-CONTINUING> (4,947)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,947)
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
