On February 13, 2003 L-Air issued a press release announcing that Belgium Universal Airline had entered into an agreement to operate a weekly flight for a Belgian tour operator called VGAA.NV. The flight would travel from Brussels to Los Angeles, with stops in Yeravan, Armenia and Lyon, France.
The Company projected that the flights would generate revenues of $18 million a year, at a rate of $360,000 per week. It said that it had finalized negotiations to lease two Airbus A340-300 airplanes from an unnamed “major manufacturer,” and planned to start flying as soon as it received approval from the Belgian authorities.
Is this consistent with the Company’s commitment to “cost efficiencies?” A typical Airbus A340-300 airplane seats roughly 250 to 300 passengers. A full plane, carrying 300 passengers, would have to charge an average of $1,200 per person in order for the Company to receive $360,000. Of course, the per passenger cost will be even greater since this does not include the tour operator’s profit. As a practical matter, is VGAA.NV likely to fully book a plane each week, at these costs? How much will it cost the Company to operate each flight, lease the planes and purchase fuel? None of these questions are addressed in the February 13th press release.
Plenty of Partners
So far, the Company has not demonstrated any ability to raise sufficient funds to operate its business. It has, however, managed to find the means to promote its latest plans. On February 5th the Company issued a press release announcing that it had retained a company called Geneva Equities Ltd. to develop investor awareness and “contribute to funding, analyzing, structuring, negotiating and financing business acquisitions, joint ventures, alliances and other desirable projects of great value to the Company and its shareholders.”
The press release claimed that the relationship with Geneva Equities would “facilitate” the Company’s ability to raise the financing necessary to finalize its latest acquisition. It did not indicate how this might be accomplished. Nor did it identify any of the individuals involved with Geneva Equities, explain how the Company had developed the relationship, specify how Geneva Equities would be compensated for its services, or say where this new business partner was located. We were unable to find any details about Geneva Equities, although we did learn that a business using that name sought office space in Santa Monica, California in September 2002.
The Company also has referred to its relationship with a Toronto, Canada-based company called Universal Capital Partners (UCP). In its February 11th press release, the Company said that UCP was negotiating the acquisition of Belgium Universal Airline. It also identified UCP as the Company’s single largest shareholder.
That information seems to be at odds with the Company’s previous public disclosures. According to documents filed with the SEC, there were approximately 22.3 million shares of common stock outstanding as of August 31, 2002. Publicly filed documents indicate that the Company’s President, Alex Goldman of Toronto, Canada, is L-Air’s largest shareholder, with 15 million shares. He acquired that stock from his predecessor as president, Robert Rosner, in September 2002.
Stock Patrol readers may remember Robert Rosner as the President, Chairman of the Board, and largest shareholder of Money Club Financial, Inc., another struggling over-the-counter company with grand plans and virtually no cash. See Money Club Financial, Inc. – Money Business or Monkey Business?
And what is Universal Capital Partners? UCP is an investor relations firm located at 130 King Street West, Suite 3670, Toronto, Canada – the same office address and suite occupied by L-Air. UCP, L-Air, and Belgium Universal Airline also share a common telephone number.
UCP’s business, according to information we found on its website, is to help clients increase their profile with brokers, institutional investors, and the general public. In other words, the entity identified as the Company’s largest shareholder is in the promotion business.
The UCP website identifies two of the firm’s clients, one of which is L-Air. It does not, however, indicate that UCP owns L-Air stock. Is Alex Goldman associated with UCP, and if so, in what capacity? The UCP website does not say – and fails to identify who controls or manages that entity.
L-Air may welcome its associations with UCP and Geneva Equities, but the Company says that there are some relationships it wishes to sever. On October 30, 2002, L-Air announced that it had amended its Articles of Incorporation to prohibit its transfer agent from registering common shares in the names of the Depository Trust Company (DTC) or other securities clearing houses. DTC is the world’s largest securities depository, and provides a clearinghouse for the settlement of transactions.