22 Exhibit ULTIMATE - 704

ForecastIncomeStatementfortheProposedService:SecondQuarterofOperations(1July201330September2013)

A BCD

Basic Forecast Proposed Service Combined Forecast Q1-Q2 Cumulative
OperatingRevenue Sales Flight $ 6,749,962.24 331,359.66 $ 7,081,321.90 $ 14,044,199.95 $ Sales Contract Flight $ 28,393.32 28,393.32 $ 56,786.63 $
Sales Road Fuel $ 1,301,703.37 1,301,703.37 $ 2,603,406.74 $
Sales Home Fuel $ 683,313.70 683,313.70 $ 1,366,627.39 $ Sales Crewing $ 414,803.94 414,803.94 $ 829,607.88 $ Sales Fuel Surcharge $ 365,072.41 365,072.41 $ 730,144.82 $ Sales Catering $ 11,272.27 11,272.27 $ 22,544.53 $ Sales Aircraft Supplies $ 20,203.14 20,203.14 $ 40,406.28 $ Sales LdglPark Fees $ 199,750.23 199,750.23 $ 399,500.46 $ Sales Crew Overnight $ 38,157.50 38,157.50 $ 76,315.00 $ Sales Rent Hangar/Office $ 8,387.50 8,387.50 $ 16,775.00 $
Sales Maintenance-Labor $ 144,848.47 144,848.47 $ 289,696.93 $
Sales Maintenance-Other $ 430,247.05 430,247.05 $ 860,494.10 $ Sales Flight Attendant $ 68,400.00 68,400.00 $ 136,800.00 $
Sales Miscellaneous $ 3,150.66 3,150.66 $ 6,301.32 $ Sales Ground Transportation $ 17,889.77 17,889.77 $ 35,779.53 $

Total Operating Revenue: 10,485,555.55 $ 331,359.66 $ 10,816,915.20 $ 21,515,386.56 $

OperatingExpenses Cogs Road Fuel $ 2,516,195.91 97,617.78 $ 2,613,813.69 $ 5,227,627.38 $ Cogs Home Fuel $ 587,093.10 587,093.10 $ 1,174,186.20 $ Cogs Insurance $ 121,333.03 121,333.03 $ 242,666.06 $ Engine Reserve $ 89,383.82 89,383.82 $ 178,767.64 $ Avionics Program $ 3,506.32 3,506.32 $ 7,012.64 $ Generator Program $ 15,309.77 15,309.77 $ 30,619.54 $ Cogs Catering $ 10,632.66 412.75 $ 11,045.41 $ 22,090.82 $ Cogs NC Supplies $ 37,484.89 37,484.89 $ 74,969.78 $ Cogs Ldg/Park Fees $ 207,987.96 33,548.19 $ 241,536.15 $ 483,072.30 $ Cogs Hangar Rent $ 37,207.82 37,207.82 $ 74,415.63 $ Cogs Maintenance $ 588,686.09 25,550.20 $ 614,236.29 $ 1,228,472.57 $ Cogs Customs $ 971.25 971.25 $ 1,942.49 $ Cogs Contract Flight $ 23,865.34 23,865.34 $ 47,730.67 $ Cogs NC Lease Payments $ 199,375.18 199,375.18 $ 398,750.36 $ Cogs Hotel/Food $ 188,078.66 188,078.66 $ 376,157.31 $ Cogs O/S Maintenance $ 4,807.17 4,807.17 $ 9,614.34 $
Commissions $ 38,163.02 38,163.02 $ 76,326.03 $ Cogs Ground Transportation $ 20,957.03 20,957.03 $ 41,914.05 $ COGS Booking Fees $ 91,181.89 3,854.74 $ 95,036.63 $ 188,669.42 $ Cogs Due Owners $ 2,532,306.25 2,532,306.25 $ 5,064,612.49 $ Wages $ 1,007,015.93 1,007,015.93 $ 2,014,031.86 $ Wages Overtime $ 132,420.46 132,420.46 $ 264,840.92 $
Commissions $ 215,123.24 215,123.24 $ 430,246.47 $ Fica Tax Employer Expense $ 103,467.48 103,467.48 $ 206,934.96 $ Futa Expense $ 1,432.29 1,432.29 $ 2,864.58 $ Suta Expense $ 29,213.46 29,213.46 $ 58,426.91 $ Workers Comp Expense $ 16,262.61 16,262.61 $ 32,525.21 $ Health Insurance Expense $ 65,911.20 65,911.20 $ 131,822.39 $
AFLAC $ 505.21 505.21 $ 1,010.41 $ Car Allowance Expense $ 1,639.16 1,639.16 $ 3,278.31 $ Apt Allowance Expense $ 4,182.50 4,182.50 $ 8,365.00 $ Drug Testing $ 1,424.50 1,424.50 $ 2,849.00 $ Training Expense $ 34,274.50 34,274.50 $ 68,549.00 $ Per Diem Overnight Expense $ 111,010.70 111,010.70 $ 222,021.40 $ Per Diem Flight Expense $ 114,847.50 114,847.50 $ 229,695.00 $ Repairs & Upkeep $ 16,653.30 16,653.30 $ 33,306.59 $
License,Permlt,Fees $ 4,575.41 4,575.41 $ 9,150.82 $ Office Supplies $ 9,025.04 9,025.04 $ 18,050.08 $ Cornputer Expenses $ 14,998.32 14,998.32 $ 29,996.63 $ Membership,Dues,Subscrip $ 8,037.71 8,037.71 $ 16,075.41 $22 Exhibit ULTIMATE - 704

ForecastIncomeStatementfortheProposedService:SecondQuarterofOperations(1July201330September2013)

A BCD

Basic Forecast Proposed Service Combined Forecast Q1-Q2 CumulativeOperatingExpenses(continued) Telephone $ 11,460.99 11,460.99 $ 22,921.98 $
Television & Internet $ 2,257.15 2,257.15 $ 4,514.29 $ Freight $ 27,233.23 27,233.23 $ 54,466.46 $ Advertising-Sales $ 70,466.13 70,466.13 $ 155,932.26 $ Travel Expense $ 12,048.62 12,048.62 $ 24,097.23 $
Meals/Entertainment $ 4,464.26 4,464.26 $ 8,928.52 $ Postage $ 394.08 394.08 $ 788.16 $ Interest Expense $ 67,970.06 67,970.06 $ 135,940.11 $ Legal Expense $ 32,943.75 32,943.75 $ 65,887.50 $
Bank Fees $ 13,903.09 13,903.09 $ 27,806.18 $ Finance Charges $ 16,788.31 16,788.31 $ 33,576.62 $
Federal Tax Penalties $ -

- $ - $
Canada Tax Penalties $ -

- $ - $ Insurance Expense $ 32,859.63 32,859.63 $ 65,719.25 $ Shop Supplies $ 3,425.81 3,425.81 $ 6,851.61 $ Uniform Expense $ 1,646.89 1,646.89 $ 3,293.77 $ Rent Expense $ 35,150.02 35,150.02 $ 70,300.03 $ Equip Rent $ 21,501.98 21,501.98 $ 43,003.95 $
Electric $ 5,277.56 5,277.56 $ 10,555.11 $
Gas $ 3,266.60 3,266.60 $ 6,533.20 $
Other Utilities $ 530.28 530.28 $ 1,060.56 $ Flowage Fees $ 7,783.45 7,783.45 $ 15,566.90 $
Small Tools $ 838.70 838.70 $ 1,677.40 $ Employee Benefits $ 776.86 776.86 $ 1,553.72 $
Professional Fees $ 15,960.93 15,960.93 $ 31,921.86 $ Depreciation $ 191,793.50 191,793.50 $ 383,587.00 $
Real Estate Taxes $ 7,524.90 7,524.90 $ 15,049.80 $
Other Taxes $ 9,551.08 9,551.08 $ 19,102.16 $
GST -Canada $ 5,652.03 5,652.03 $ 11,304.05 $

Total Operating Expenses: 9,810,017.43 $ 160,983.66 $ 9,971,001.09 $ 19,955,598.35 $

Net Income From Operations: 675,538.12 $ 170,376.00 $ 845,914.11 $ 1,559,788.20 $
NonOperatingIncome(Expense) Other Income and Expense $ -

- $ - $
Discounts $ -

- $ - $
Interest Income $ 141.28 141.28 $ 282.56 $

Total Non-Operating Income (Expense) 141.28 $ - $ 141.28 $ 282.56 $

Net Income (Loss): 675,679.40 $ 170,376.00 $ 846,055.39 $ 1,560,070.76 $Exhibit ULTIMATE - 706

ForecastIncomeStatementfortheProposedService:FourthQuarterofOperations(1January201431March2014)

A BCD

Basic Forecast Proposed Service Combined Forecast Q1-Q4 Cumulative
OperatingRevenue Sales Flight $ 6,749,962.24 428,457.55 $ 7,178,419.79 $ 28,378,489.12 $ Sales Contract Flight $ 28,393.32 28,393.32 $ 113,573.26 $
Sales Road Fuel $ 1,301,703.37 1,301,703.37 $ 5,206,813.48 $
Sales Home Fuel $ 683,313.70 683,313.70 $ 2,733,254.78 $ Sales Crewing $ 414,803.94 414,803.94 $ 1,659,215.76 $ Sales Fuel Surcharge $ 365,072.41 365,072.41 $ 1,460,289.64 $ Sales Catering $ 11,272.27 11,272.27 $ 45,089.06 $ Sales Aircraft Supplies $ 20,203.14 20,203.14 $ 80,812.56 $ Sales LdglPark Fees $ 199,750.23 199,750.23 $ 799,000.92 $ Sales Crew Overnight $ 38,157.50 38,157.50 $ 152,630.00 $ Sales Rent Hangar/Office $ 8,387.50 8,387.50 $ 33,550.00 $
Sales Maintenance-Labor $ 144,848.47 144,848.47 $ 579,393.86 $
Sales Maintenance-Other $ 430,247.05 430,247.05 $ 1,720,988.20 $ Sales Flight Attendant $ 68,400.00 68,400.00 $ 273,600.00 $
Sales Miscellaneous $ 3,150.66 3,150.66 $ 12,602.64 $ Sales Ground Transportation $ 17,889.77 17,889.77 $ 71,559.06 $

Total Operating Revenue: 10,485,555.55 $ 428,457.55 $ 10,914,013.09 $ 43,320,862.34 $

OperatingExpenses Cogs Road Fuel $ 2,516,195.91 95,114.76 $ 2,611,310.67 $ 10,445,242.68 $ Cogs Home Fuel $ 587,093.10 587,093.10 $ 2,348,372.40 $ Cogs Insurance $ 121,333.03 121,333.03 $ 485,332.12 $ Engine Reserve $ 89,383.82 89,383.82 $ 357,535.28 $ Avionics Program $ 3,506.32 3,506.32 $ 14,025.28 $ Generator Program $ 15,309.77 15,309.77 $ 61,239.08 $ Cogs Catering $ 10,632.66 402.17 $ 11,034.83 $ 44,139.31 $ Cogs NC Supplies $ 37,484.89 37,484.89 $ 149,939.56 $ Cogs Ldg/Park Fees $ 207,987.96 42,149.98 $ 250,137.94 $ 975,153.76 $ Cogs Hangar Rent $ 37,207.82 37,207.82 $ 148,831.26 $ Cogs Maintenance $ 588,686.09 24,895.07 $ 613,581.15 $ 2,454,324.61 $ Cogs Customs $ 971.25 971.25 $ 3,884.98 $ Cogs Contract Flight $ 23,865.34 23,865.34 $ 95,461.34 $ Cogs NC Lease Payments $ 199,375.18 199,375.18 $ 797,500.72 $ Cogs Hotel/Food $ 188,078.66 188,078.66 $ 752,314.62 $ Cogs O/S Maintenance $ 4,807.17 4,807.17 $ 19,228.68 $
Commissions $ 38,163.02 38,163.02 $ 152,652.06 $ Cogs Ground Transportation $ 20,957.03 20,957.03 $ 83,828.10 $ COGS Booking Fees $ 91,181.89 4,999.49 $ 96,181.37 $ 380,769.03 $ Cogs Due Owners $ 2,532,306.25 2,532,306.25 $ 10,129,224.98 $ Wages $ 1,007,015.93 1,007,015.93 $ 4,028,063.72 $ Wages Overtime $ 132,420.46 132,420.46 $ 529,681.84 $
Commissions $ 215,123.24 215,123.24 $ 860,492.94 $ Fica Tax Employer Expense $ 103,467.48 103,467.48 $ 413,869.92 $ Futa Expense $ 1,432.29 1,432.29 $ 5,729.16 $ Suta Expense $ 29,213.46 29,213.46 $ 116,853.82 $ Workers Comp Expense $ 16,262.61 16,262.61 $ 65,050.42 $ Health Insurance Expense $ 65,911.20 65,911.20 $ 263,644.78 $
AFLAC $ 505.21 505.21 $ 2,020.82 $ Car Allowance Expense $ 1,639.16 1,639.16 $ 6,556.62 $ Apt Allowance Expense $ 4,182.50 4,182.50 $ 16,730.00 $ Drug Testing $ 1,424.50 1,424.50 $ 5,698.00 $ Training Expense $ 34,274.50 34,274.50 $ 137,098.00 $ Per Diem Overnight Expense $ 111,010.70 111,010.70 $ 444,042.80 $ Per Diem Flight Expense $ 114,847.50 114,847.50 $ 459,390.00 $ Repairs & Upkeep $ 16,653.30 16,653.30 $ 66,613.18 $
License,Permlt,Fees $ 4,575.41 4,575.41 $ 18,301.64 $ Office Supplies $ 9,025.04 9,025.04 $ 36,100.16 $ Cornputer Expenses $ 14,998.32 14,998.32 $ 59,993.26 $ Membership,Dues,Subscrip $ 8,037.71 8,037.71 $ 32,150.82 $Exhibit ULTIMATE - 706

ForecastIncomeStatementfortheProposedService:FourthQuarterofOperations(1January201431March2014)

A BCD

Basic Forecast Proposed Service Combined Forecast Q1-Q4 CumulativeOperatingExpenses(continued) Telephone $ 11,460.99 11,460.99 $ 45,843.96 $
Television & Internet $ 2,257.15 2,257.15 $ 9,028.58 $ Freight $ 27,233.23 27,233.23 $ 108,932.92 $ Advertising-Sales $ 70,466.13 70,466.13 $ 296,864.52 $ Travel Expense $ 12,048.62 12,048.62 $ 48,194.46 $
Meals/Entertainment $ 4,464.26 4,464.26 $ 17,857.04 $ Postage $ 394.08 394.08 $ 1,576.32 $ Interest Expense $ 67,970.06 67,970.06 $ 271,880.22 $ Legal Expense $ 32,943.75 32,943.75 $ 131,775.00 $
Bank Fees $ 13,903.09 13,903.09 $ 55,612.36 $ Finance Charges $ 16,788.31 16,788.31 $ 67,153.24 $
Federal Tax Penalties $ -

- $ - $
Canada Tax Penalties $ -

- $ - $ Insurance Expense $ 32,859.63 32,859.63 $ 131,438.50 $ Shop Supplies $ 3,425.81 3,425.81 $ 13,703.22 $ Uniform Expense $ 1,646.89 1,646.89 $ 6,587.54 $ Rent Expense $ 35,150.02 35,150.02 $ 140,600.06 $ Equip Rent $ 21,501.98 21,501.98 $ 86,007.90 $
Electric $ 5,277.56 5,277.56 $ 21,110.22 $
Gas $ 3,266.60 3,266.60 $ 13,066.40 $
Other Utilities $ 530.28 530.28 $ 2,121.12 $ Flowage Fees $ 7,783.45 7,783.45 $ 31,133.80 $
Small Tools $ 838.70 838.70 $ 3,354.80 $ Employee Benefits $ 776.86 776.86 $ 3,107.44 $
Professional Fees $ 15,960.93 15,960.93 $ 63,843.72 $ Depreciation $ 191,793.58 191,793.58 $ 767,174.08 $
Real Estate Taxes $ 7,524.90 7,524.90 $ 30,099.60 $
Other Taxes $ 9,551.08 9,551.08 $ 38,204.32 $
GST -Canada $ 5,652.03 5,652.03 $ 22,608.10 $

Total Operating Expenses: 9,810,017.51 $ 167,561.46 $ 9,977,578.97 $ 39,895,961.19 $

Net Income From Operations: 675,538.03 $ 260,896.09 $ 936,434.12 $ 3,424,901.15 $
NonOperatingIncome(Expense) Other Income and Expense $ -

- $ - $
Discounts $ -

- $ - $
Interest Income $ 141.28 141.28 $ 565.12 $

Total Non-Operating Income (Expense) 141.28 $ - $ 141.28 $ 565.12 $

Net Income (Loss): 675,679.31 $ 260,896.09 $ 936,575.40 $ 3,425,466.27 $

### ULTIMATE JET LLC
**AND SUBSIDIARIES**
**REVIEWED FINANCIAL STATEMENTS YEAR ENDING DECEMBER 31, 20**  **1 2** INDEX

ACCOUNTANT’S REVIEW REPORT

................................ ................................ ................. 1

BALANCE SHEET

- December 31, 20 1 2

................................ ................................ ............. 2 & 3

STATEMENT OF INCOME

................................ ................................ ................................ ... 4

STATEMENT OF CASH FLOWS

................................ ................................ ......................... 5

STATEMENT OF CHANGES IN STOCKHOLDER’S EQUITY

................................ ............ 6

NOTES TO FINANCIAL STATEMENTS

................................ ................................ .............. 7

- 1 4

SUPPORTING SCHEDULES

SCHEDULE

- SALES

................................ ................................ ................................ . S

- 1

SCHEDULE

- COST OF SALES

................................ ................................ ............... S

- 1

SCHEDULE

- SELLING, GENERAL & ADMINISTRATIVE EXPENSES

................ S

- 2

SCHEDULE

- OTHER INCOME

................................ ................................ .............. S

- 3

SCHEDULE

- OTHER EXPENSE

................................ ................................ ........... S

- 3

CONSOLIDATING FINANCIAL STATEMENT

## S CHROEDER 

## & C O 

## ., LLC

Certified Public Accountants

NICHOLAS V. SCHROEDER, CPA 315 EAST MAIN STREET FRED J. SCHROEDER, CPA P.O. BOX 307

——— OTTAWA, OHIO 45875

JEFFERY W. RIEMAN, CPA TELEPHONE (419) 523

- 6191 MELANIE A. METZGER, CPA FAX (419) 523

- 6500

E

- MAIL: schroedercpa@schroedercocpas.com

WE BSITE: www.schroedercocpas.com

INDEPENDENT ACCOUNTANT’S REVIEW REPORT

To the Members
Ultimate Jet LLC and S ubsidiaries

We have reviewed the accompanying consolidated balance sheet of Ultimate Jet LLC and
Subsidiaries as of December 31, 201 2 , and the related consolidated statements of income

, changes in memb ers’ equity and cash flows for the year then ended. A review includes primarily applying analytical procedures to management’s fina ncial data and making inquiries of Company management. A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, we do not express such an opini on.

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal contro l relevant to the preparation and fair presentation of the financial statements.

Our responsibility is to conduct the review in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. Those standards require us to perform procedures to obtain limited assurance that there are no
material modifications that should be made to the consolidated financial statements. We believe that the results of our procedures provide a reasona ble basis for our report.

Based on our review, w e are not aware of any material modifications that should be made to the accompanying consolidated financial statements in order for them to be in conformity with accounting principles generally accepted in t he United States of America.

Our review was made for the purpose of expressing a conclusion that there are no material
modifications that should be made to the consolidated financial statements in order for them to be in conformity with accounting principl es generally accepted in the United States of America. The information included in the accompanying consolidated Supporting Schedules is presented only for purposes of additional analysis and has not been subjected to the inquiry and analytical procedures applied in the review of the basic consolidated financial statements, but was compiled from information that is the representation of management, without audit or review. Accordingly, we do not express an opinion or any other form of assurance on the suppl ementary information.

SCHROEDER & CO., LLC
CERTIFIED PUBLIC ACCOUNTANTS

March 1 8, 2013

1

# Ultimate Jet LLC
**and Subsidiaries**

**Balance Sheet As of December 31, 2012** 

**See Accompanying Notes And Independent**  **Accountants' Review Report**

**2** 

## Assets **Current Assets**
Cash & Cash Equivalents 21,757
**Total Cash & Cash Equivalents** 21,757

Accounts Receivable - Trade 968,090
Due from Aircraft Owners 6,595,506

**Total Accts & Notes Receivable** 7,563,596

Inventory - Parts 775,123

**Total Inventory** 775,123

Prepaid Insurance 202,687
Outside Maintenance in Process 15,608 Lease Deposits 237,788 Prepaid Fuel 62,113 Prepaid Expenses 32,885 Deposits 573,588
**Total Prepaid Items** 1,124,669



### Total Current Assets 9,485,145



### Property & Equipment

**Accumulated Carrying** 

**Cost Depreciation**  **Amount** Buildings 943,617 (54,061) 889,556 Equipment 242,578 (74,991) 167,587 Transportation Equipment 89,333 (27,373) 61,960 Office Furniture & Equipment 16,884 (4,027) 12,857 Tooling 23,208 (5,222) 17,986
Aircraft 12,296,769 (1,623,299) 10,673,470 Leasehold Improvements 20,404 (1,360) 19,044



### Total Property & Equipment 13,632,793 (1,790,333) 11,842,460



### Other Assets

Unamortized Loan Costs 34,794
License Costs 627,942



### Total Other Assets 662,736



### Total Assets **21,990,341**

# Ultimate Jet LLC
**and Subsidiaries**

**Balance Sheet As of December 31, 2012** 

**See Accompanying Notes And Independent**  **Accountants' Review Report**

**3** 

## Liabilities

**Current Liabilities**

Bank Overdraft 8,262 Notes Payable 1,194,710
Current Portion - L T Debt 642,150 Accounts Payable - Trade 2,530,950 Customer Deposits for Fuel 65,685

Unearned Revenue 415,314 City Tax W/H 5,552 Sales Tax Payable (1,703)

Federal Excise Tax 94,029
**Accrued Liabilities** Accrued Wages 247,111
Accrued FICA 17,421 Accrued Unemployment 28,646

Accrued Industrial Insurance 38,105 Accrued Expenses 96,210

Accrued Insurance 211,336

**Total Accrued Liabilities** 638,829



### Total Current Liabilities 5,593,778



### Long-Term Liabilities
Mortgage Payable - Building 1,292,500 Mortgage Payable - Equipment 6,333,250 Notes Payable - Officers 1,458,398 Notes Payable - Other 916,667
Current Portion - L T Debt (642,150) 

### Total Long-Term Liabilities 9,358,665



### Total Liabilities 14,952,443 

## Members' **Equity**

**Members' Equity** 
Member's Equity 7,037,898 

### Total **Members' Equity** 7,037,898 

### Total Liabilities & Equity **21,990,341**

# Ultimate Jet LLC
**and Subsidiaries**

**Statement of Income For the Period Ended December 31, 2012** 

**See Accompanying Notes a**  **nd Independent**  **Accountants' Review Report**

**4 12 Months Ended** 

**Dec. 31, 2012 Pct** 



### Sales 41,346,372 100.00



### Cost of Sales 28,524,745 68.99



### Gross Profit **12,821,627 31.01** 



### Selling, General, and Administrative Expenses 9,541,183 23.08



### Net Income From Operations **3,280,444 7.93** 

Other Income 1,480 0.00

Other Expense (572,364) 1.38



### Net Income (Loss) **2,709,560 6.55** 

# Ultimate Jet LLC
**and Subsidiaries**

**Statement of Cash Flows For the Period Ended December 31, 2012** 

**See Accompanying Notes a**  **nd Independent**  **Accountants' Review Report**

**5** 

### Cash Flows From Operating Activities:
Net Income (Loss) 2,709,560 Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities: Depreciation 894,415

Amortization 4,119 Losses (Gains) On Sale of Assets 8,781 Changes In Assets & Liabilities: (Inc) Dec In Accounts Receivable (157,828) (Inc) Dec In Inventory (157,115) (Inc) Dec In Prepaid Expenses 462,358 (Inc) Dec In Deposits (423,588) Inc (Dec) In Bank Overdrafts 8,262 Inc (Dec) In Accounts Payable 487,963 Inc (Dec) In Accrued and Other Liabilities (362,090)

**Total Adjustments** 765,277

**Net Cash Provided by Operating Activities** 3,474,837



### Cash Flows From Investing Activities:

Proceeds From Sales of Assets 500 Additions To Equipment (6,200) Additions To Transportation Equipment (20,703)
Additions To Office Furniture & Fixtures (1,779)

Additions To Aircraft (3,867,259) (Inc) Dec In Other Assets (128,913)

**Net Cash Provided by Investing Activities** (4,024,354)



### Cash Flows From Financing Activities:
Proceeds From Building Mortgages 476,859 Proceeds From Equipment Notes 20,703
Proceeds From Other Loans 1,000,000 Repayment Of Short Term Notes (418,587) Repayment Of Building Mortgages (50,335) Repayment Of Equipment Notes (274,345) Repayment Of Officer Loans (130,781) Repayment Of Other Notes (83,333)

**Net Cash Provided by Financing Activities** 540,181 

### Net Inc (Dec) in Cash and Cash Equivalents (9,336)



### Cash & Cash Equivalents - Beg Of Period 31,096



### Cash & Cash Equivalents - End Of Period **21,760**



### Supplemental Information:
Cash Paid For Interest (Net of Refunds) 504,472 Cash Paid (Refunded) For Income Taxes 0

# Ultimate Jet LLC and Subsidiaries

**Statement of Changes In Members' Equity For The Year Ended December 31, 2012** 

**Accumulated**
**Other**
**Members Comprehensive**  **Equity Income**  **Total**

**BAL., December 31, 2011** 4,328,338 (34,904) 4,293,434

Net Income (Loss) for 2012 2,709,560 2,709,560

Unrealized Gain (Losses)
from Derivative Instrument 34,904 34,904

**BAL., December 31, 2012** 7,037,898 0 7,037,898

**See Accompanying Notes and Independent Accountant's Review Report**

**6 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 1**

**. N**  **ature of Business and Significant Accounting Policies**

**Nature of Business**

Ultimate Jet LLC and Subsidiaries is a full

- service, fixed

- base air charter operation located at the Akron

Canton Regional Airport in Ohio. The Companies are limited liability companies. The members’ liability is

limited to their investment.

The Company owns aircraft a nd has entered into lease arrangements with the owners of various aircraft, principally 30 seat Dornier 328 jets, providing charter flight services to a variety of customers. Under the
terms of the aircraft leases, the owner of the aircraft receives 90% o f the revenue and is responsible for all of the operating expenses attributable to each charter flight.

Additionally, the Company sells fuel and provides maintenance services to the leased aircraft from its fixed base operation at the Akron

- Canton regio nal airport.

Ultimate Jet LLC and Subsidiaries commenced operations on October , 20 10

.

The consolidated financial statements of the Company reflect the application of certain policies described

in this note.

**Principles of Consolidation**

The consolidated financial statements include the accounts of Ultimate Jet LLC , and its wholly

- owned
subsidiaries Ultimate JetCharters, LLC and Ultimate Real Estate, LLC, (collectively the Company). All material intercompany accounts and transactions are eliminated in consolidation.

**Use of Estimates**

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and

disclosures

. Accordingly, actual results could differ from those estimates.

**Concentration of Credit Risk**

The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured

limits. The Company has not experienced any losses in such accounts, and management believes it is not exposed to any significant credit risk on cash.

The Company grants credit to customers, substantially all of which are located in the United States of

America. The Company has a comprehensive credit manage ment program that includes ongoing credit evaluation of its customers, generally does not require collateral, and monitors potential credit losses. Credit losses have historically been within management’s expectation.

**7 ULTIMATE JET LLC**  **AND SUBSIDIARIE S** 

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 1. Nature of Business and Significant Accounting Policies**  **(Continued)**

**Revenue Recognition**

Revenue from passenger transportation is recognized when provided. Revenue from s ales of fuel and maintenance are recognized on a time

- and

- material basis. Deposits received on flights are recorded as unearned revenue and recognized at the time services are provided.

**Fair Value of Financial Instruments**

The carrying amounts of financial instruments, including cash, accounts receivable, accounts payable,
accrued liabilities, and short

- term borrowings approximates fair value due to the short maturity of these

instruments. The carrying amount of long

- term debt approximates fair value because the interes t rates

fluctuate with market interest.

**Cash & Cash Equivalents**

For purpose of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.

**Accounts Receivable** 

Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by identif ying troubled accounts. At December 31, 20 1 2

, management had determined that no allowance for doubtful receivables was required. Receivables are

written off when deemed uncollectible. Recoveries of receivables previously written off are recorded

when re ceived.

**Inventories**

Inventories consist of aircraft replacement parts, fuel, and supplies held for resale. Inventories are valued

at the lower of cost or market. Cost is determined by the first

- in, first

- out (FIFO) method.

**8 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 1. Nature of Business and Significant Accounting Policies (Continued)**

**Property and Equipment**

Property and equipment are recorded at cost. Gains and losses on disposition of property and equipment are recognized as a component of current operations. Maintenance and repairs are expensed as

incurred. Provisions for deprec i ation are computed principally by using the straight

- line method. Useful lives of property and equipment are as follows:

Building 40 years

Aircraft 12 years Equipment and tooling 7

- 10 years
Furniture and fixtures 7 years
Vehicles 5 years Leasehold Improvements 20 years

Depreciation expense for the year ended December 31, 20 1 2 was $ 894,415

.

**Impairment of Long**

**- Lived Assets** 

The Company assesses potential impairment to its long

- lived assets when events or changes in circumstances have made recovery of the assets carrying value unlikely and the carrying amount of the

assets exce eds the estimated future undiscounted cash flows. If the assessment indicates that the carrying amounts may not be recoverable, an impairment loss would reduce the assets carrying amount to its estimated fair value based on the present value of the estima ted future cash flows.

**Advertising**

The Company expenses advertising as incurred. For the year ended December 31, 20 12 , advertising expenses were $ 275,667

.

**Presentation of Sales Taxes**

The State of Ohio imposes a sales tax on certain of the Company’s sales to nonexempt customers. The Company collects that sales tax from customers and remits the entire amount to the State. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and

cost of sales.

**9 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 1. Nature of Business and Significant Accounting Policies**  **(Continued)**

**Intangible Assets**

Loan Closing costs of $38,913 are being amortized on the straight

- line method over the life of the loans ranging from 3

- 5 years. Accumulat ed amortization at December 31, 2012 related to loan closing costs was $4,119.

Amortization expense charged to operations in 2012 was $4,119. The estimated amortization expense

for each of the next 5 years is as follows:

2013 $9,617

2014 9,617

2015 7, 324

2016 5,031

2017 3,205

**Income Taxes**

The Company has elected to be treated as a Partnership for federal and state income tax purposes. The Company’s taxable income or losses, as well as

, certain other tax attributes, are passed through directly to the Company’s members and are reported in each member ’s individual income tax return

. Consequently, these consolidated financial statements do not include any provision for federal or state

inc ome tax expense or liability.

**Note 2** 

**. Short** 

**- Term Borrowings** 

Short

- term notes payable consists of a revolving line of credit of up to $1,750,000. At December 31, 2012, the balance was $1,194,710. This note is secured by security interest in all asset s of the Company including but not limited to inventory, accounts receivable, aircraft, and fixed assets. Interest is payable monthly at an interest rate per annum equal to the rate being asked on an amount of Eurodollar deposits equal to the amount of ad vances subject to LIBOR Rate election on the first day of a LIBOR Interest Period and which has a maturity corresponding to the maturity of the LIBOR Interest Period, as reported by Telerate rate reporting system (or any successor) as determined by the Len der by noon on the effective date of the LIBOR Interest Period (rounded upwards, if necessary, to the next 1/8 th of 1%) (the “LIBOR Rate”), plus 350 basis points. The interest rate at December 31, 2012 was 3.75%. Any outstanding principal and interest is due at maturity on July 12, 2013.

The Company pays the Lender an unused portion fee in an amount equal to one

- quarter of one percent (.25%) per annum of the average daily unborrowed principal amount available under the Revolving Loan as computed by Lender

. The unused portion fee is paid quarterly.

**10 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 3** 

**. Long** 

**- Term Debt** 

Long

- term debt consists of the following at December 31 , 201 2 :

Principal Amount

Term Loan , due July 31, 2015 $ 916,667

Mortgage Loan , due July 31, 2017 1,292,500

Note Payable for 359 SK Jet, due November 20, 2017 2,780,693

Note Payable for 406 Aircraft, due November 30, 2012 3,532,654

Note Payable for Vehicle , due October 28, 2016 19,903

Note Payable

- Officer 1,458,398
10,000,815 Less current portion ( 642,150 ) $ 9,358,665

The Term Note is secured by security interest in all assets of the Company including but not limited to inventory, accounts receivable, aircraft, and fixed assets. Interest is payable monthly at an interest rate per annum equal to the rate being asked on an amount of Eurodollar deposits equal to the amount of

advances su bject to LIBOR Rate election on the first day of a LIBOR Interest Period and which has a maturity corresponding to the maturity of the LIBOR Interest Period, as reported by Telerate rate reporting system (or any successor) as determined by the Lender by no on on the effective date of the LIBOR Interest Period (rounded upwards, if necessary, to the next 1/8 th of 1%) (the “LIBOR Rate”), plus 400 basis points. The interest rate at December 31, 2012 was 4.25%. Fixed principal installments of $16,667.67 are due monthly with any outstanding principal and interest due at maturity on July 31, 2015.

The mortgage loa n is secured by security interest in real estate owned by the Company. Interest is payable monthly at an interest rate per annum equal to the rate being asked on an amount of Eurodollar deposits equal to the amount of advances subject to LIBOR Rate electi on on the first day of a LIBOR Interest Period and which has a maturity corresponding to the maturity of the LIBOR Interest Period, as reported by Telerate rate reporting system (or any successor) as determined by the Lender by noon on

the effective date o f the LIBOR Interest Period (rounded upwards, if necessary, to the next 1/8 th of 1%) (the “LIBOR Rate”), plus 350 basis points. The interest rate at December 31, 2012 was 3.75%. Fixed principal installments of $5,500 are due monthly with any outstanding principal and interest due at maturity on July 31, 2017.

**11 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 3** 

**. Long** 

**- Term Debt**  **(Continued)**

The Company has two notes payable, which are collateralized by aircraft. The first bears interest at the

4.69 %. Payments are $ 30,250 including principal and interest until October 20, 2017 when the remaining

balance is payable in full. The second bears interest at 7.44%. Payments are $32,000 per month and
was due November 30, 2012

. The Lender has not called the loan and the Company continues to pay $32,000 per month as it negotiates loans with other banks. The Co mpany considers this loan as long

term since it is probable that the loan will be refinanced with another Lender. The loan is being reported under similar conditions currently being negotiated.

The note payable for vehicle is secured by a 2013 Dodge Cara van. Installments of $466.14 incl u ding interest of 3.858% are due monthly to October 28, 2016.

The amount of interest cost incurred for the period ended December 31, 201 2 was $ 504,472 , all of which was charged to operations.

Maturities of long

- term d ebt for the years succeeding December 31, 20 1 2 , are as follows:

20 1 3 $ 642,150

201 4 653,355

2015 992,412

2016 498,572

2017 5,755,929

**Note 4** 

**– Lease Obligations** 

Operating Leases The Company conducts its operations from facilities that are leased under a five

- year noncancelable operating lease expiring in July 2013 . There is an option to renew the lease for two successive additional periods of five years each at

an increased monthl y rental.

In addition, t he Company leases aircraft under operating leases expiring in various years through December 31, 2013. Certain of these leases contain options to renew the lease for successive one year

terms.

The Company may also rent property, equipment, and transportation equipment on an as needed basis.

**12 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 4** 

**– Lease Obligations**  **(Continued)**

Minimum future rental payments under the con

- cancelable operating lease having a remaining term in excess of one year as of December 31, 201 2 for each of the next five years and in the aggregate are:

Year Amount
2013 $ 1,240,481
2014 0
2015 0
2016 0
20 17 0 Subsequent to Year 2017 0

Total Minimum Future Rental Payments $ 1,240,481

Total rent expense under operating leases for 201 2 was $ 816,041

.

**Note 5** 

**. Related Party Transactions** 

The Company leases two aircraft from an entity which is owned by an individual who is also a member of the Company. The terms of the leases are comparable to the Company’s other aircraft leases and are

described in Note 5

. As of December 31, 20 12 , the Company was owed $ 2,789,312 , by th i s lessor.

The Company also had a balance due an individual who is a member of the Company for advances made to the company. The advances are unsecured. The balance owed to the individual as of December 31, 2012 was $1 ,458,398.

**Note 6** 

**- Commitments and Contingencies** 

The Company had at December 31, 201 2 , no important unfilled contracts for the purchase of material, merchandise, or equipment in excess of normal requirements or at prices substantially in excess of
market at that date; or for the performance of services at prices that are expected to result in a loss upon completion.

The Company has adopted the guidance for uncertainty in income taxes in FASB ASC 740

- 10

- 65

- 1. The Company will record a liability for uncert ain tax positions when it is probable that a loss has been incurred and the amount can be reasonably estimated. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulin gs.

The Company’s evaluation on December 31, 201 2 revealed no tax positions that would have a material impact on the financial statements. The 2010 and 2011 tax year s remain subject to examination by the

IRS. In a ddition, the tax year s 2010 and 2011 remain subject to examination by certain states. The Company does not believe that any reasonably possible changes will occur within the next twelve months that will have a material impact on the financial statements.

**13 ULTIMATE JET LLC**  **AND SUBSIDIARIES**

**NOTES TO FINANCIAL STATEMENTS**

**DECEMBER 31, 201 2** 

**Note 6** 

**- Commitments and Contingencies**  **(Continued)**

Government Regulation Substantially all of the Company’s facilities are subject to federal, state, and local provisions regulating the dis charge of materials into the environment. Compliance with these provisions has not had, nor does the Company expect such compliance to have, any material effect upon the capital expenditures, net income, financial condition or competitive position of the Company. Management believes that its current practices and procedures for the control and disposition of such waste comply with applicable federal and state requirements.

**Note 7** 

**– Subsequent Events** 

The Company has evaluated subsequent events through Mar ch 18, 2013 , the date which the financial

statements were available to be issued. No events have occurred which would have a material effect on the financial statements of the Company as of that date except as disclosed below

.

In February 2013 , the Company purchased an aircraft that it previously had a lease arrangement with the

aircraft owners

. The company financed the aircraft purchase and was able to relieve the account receivable from the aircraft owners of $1,784,878.

**14**

# Ultimate Jet LLC
**and Subsidiaries**
**Supporting Schedules**
**For the Period Ended December 31, 2012**

**See Independent**  **Accountants' Review Report**

**S - 1**  **12 Months Ended**

**Dec. 31, 2012 Pct**  

### Sales

Sales - Charter Services & Fuel 41,346,372 100.00



### Total Sales **41,346,372 100.00** 



### Cost of Sales

Cost of Sales - Charter Services & Fuel 28,524,745 68.99



### Total Cost of Sales **28,524,745 68.99** 

# Ultimate Jet LLC
**and Subsidiaries**
**Supporting Schedules**
**For the Period Ended December 31, 2012**

**See Independent**  **Accountants' Review Report**

**S - 2**  **12 Months Ended**

**Dec. 31, 2012 Pct**  

### Selling, General, and Administrative Expenses
Salaries & Wages 6,307,135 15.25

FICA 397,581 0.96 Unemployment 95,597 0.23

Industrial Insurance 67,511 0.16 Employee Insurance & Benefits 279,701 0.68 Shop Supplies 11,135 0.03

Small Tools 2,636 0.01 Flowage Fees 40,337 0.10 Repairs & Maintenance 58,073 0.14 Depreciation - Building & Equipment 894,415 2.16

Insurance 92,289 0.22

Electric 21,151 0.05 Laundry & Uniforms 6,650 0.02 Equipment Rental 84,569 0.20 Freight 73,865 0.18 Building Rent 30,382 0.07

Real Estate Tax 22,575 0.05

Heat 8,950 0.02

Other Utilities 2,427 0.01
Licenses, Permits & Fees 14,110 0.03 Advertising 275,667 0.67 Membership Dues & Publications 40,416 0.10 Travel Expense 58,340 0.14 Training Expense 163,315 0.39

Meals & Entertainment 15,529 0.04 Telephone 44,738 0.11 Office Supplies 36,122 0.09 Legal 55,934 0.14

Professional Fees 42,895 0.10

Bank Fees 88,566 0.21 Consulting Fees 79,000 0.19 Computer Expense 65,857 0.16

Television & Internet 8,237 0.02

Taxes - Other 52,778 0.13 Miscellaneous Expense 2,700 0.01



### Total **Selling, General, and Admin. Expenses 9,541,183**  **23.08**

# Ultimate Jet LLC
**and Subsidiaries**
**Supporting Schedules**
**For the Period Ended December 31, 2012**

**See Independent**  **Accountants' Review Report**

**S - 3**  **12 Months Ended** 

**Dec. 31, 2012 Pct** 


### Other Income

Discounts Earned 563 0.00
Interest Income 917 0.00



### Total Other Income **1,480 0.00** 



### Other Expense
Interest Expense 504,472 1.22
Loss On Sales Of PP & E 8,781 0.02 Amortization Expense 4,119 0.01 Finance Charges 69,233 0.17
Nondeductible Fines/Penalties (14,241) (0.03)



### Total Other Expense **572,364 1.38** 

# Ultimate Jet LLC
**Balance Sheet**
**As of December 31, 2012**

**A S S E T S**

**Ultimate Ultimate**  **Consolidated**

**Ultimate JetCharters**  **Real Estate Total** 
**Jet LLC LLC**  **LLC Eliminations**  **12/31/2012**

**CURRENT ASSETS** Cash & Cash Equivalents

- 21,757

- - 21,757

Accounts Receivable - Trade

- 968,090

- - 968,090
Accounts Receivable - Affiliate

- - 365,095 (365,095)

- Due from Aircraft Owners

- 6,595,506

- - 6,595,506

**Total Accts & Notes Receivable**

- 7,563,596 365,095 (365,095) 7,563,596

Inventory - Parts

- 775,123

- - 775,123 **Total Inventory**

- 775,123

- - 775,123

Prepaid Insurance

- 202,687

- - 202,687
Outside Maintenance in Process

- 15,608

- - 15,608 Lease Deposits

- 237,788

- - 237,788 Prepaid Fuel

- 62,113

- - 62,113 Prepaid Expenses

- 32,885

- - 32,885 Deposits

- 573,588

- - 573,588 **Total Prepaid Items**

- 1,124,669

- - 1,124,669

**TOTAL CURRENT ASSETS**

- 9,485,145 365,095 (365,095) 9,485,145

**INVESTMENTS**

Investment in Ultimate JetCharters LLC 47,168

- - (47,168)

- Investment in Ultimate Real Estate LLC 4,281,170

- - (4,281,170)

- 4,328,338

- - (4,328,338)

-

**PROPERTY & EQUIPMENT** Buildings

- - 943,617

- 943,617 Equipment

- 242,578

- - 242,578 Transportation Equipment

- 89,333

- - 89,333 Office Furniture & Equipment

- 16,884

- - 16,884 Tooling

- 23,208

- - 23,208
Aircraft

- 12,296,769

- - 12,296,769 Leasehold Improvements

- 20,404

- - 20,404 **Total Property & Equipment Costs**

- 12,689,176 943,617

- 13,632,793 **Less Accumulated Depreciation**

- (1,736,272) (54,061)

- (1,790,333) **Total Property & Equipment**

- 10,952,904 889,556

- 11,842,460

**OTHER ASSETS**

Unamortized Loan Costs

- 18,453 16,341

- 34,794
License Costs

- 627,942

- - 627,942

**Total Other Assets**

- 646,395 16,341

- 662,736

**TOTAL ASSETS 4,328,338**  **21,084,444 1,270,992**  **(4,693,433) 21,990,341** 

**See Independent Accountant's Review Report**

# Ultimate Jet LLC
**Balance Sheet**
**As of December 31, 2012**

**Ultimate Ultimate**  **Consolidated**

**Ultimate JetCharters**  **Real Estate Total** 
**Jet LLC LLC**  **LLC Eliminations**  **12/31/2012**

**CURRENT LIABILITIES**

Bank Overdraft

- 8,262

- - 8,262 Notes Payable

- 1,194,710

- - 1,194,710
Current Portion - LT Debt

- 576,150 66,000

- 642,150 Accounts Payable - Trade

- 2,530,950

- - 2,530,950 Accounts Payable - Affiliate

- 365,095

- (365,095)

- Customer Deposits for Fuel

- 65,685

- - 65,685

Unearned Revenue

- 415,314

- - 415,314 City Tax W/H

- 5,552

- - 5,552
School District Tax W/H

- - - - - Sales Tax Payable

- (1,703)

- - (1,703)

Federal Excise Tax

- 94,029

- - 94,029 Interest-Rate Swap Derivative

- - - - Accrued Wages

- 247,111

- - 247,111
Accrued FICA

- 17,421

- - 17,421 Accrued Unemployment

- 28,646

- - 28,646

Accrued Industrial Insurance

- 38,105

- - 38,105 Accrued Expenses

- 96,210

- - 96,210

Accrued Insurance

- 211,336

- - 211,336

Accrued Interest

- - - - - **Total Current Liabilities**

- 5,892,873 66,000 (365,095) 5,593,778

**LONG-TERM DEBT** Mortgage Payable - Real Estate

- - 1,292,500

- 1,292,500 Mortgage Payable - Equipment

- 6,333,250

- - 6,333,250
Advances - Owner

- 1,458,398

- - 1,458,398 Notes Payable - Other

- 916,667

- - 916,667
Current Portion L T Debt

- (576,150) (66,000)

- (642,150)

**TOTAL LONG TERM DEBT**

- 8,132,165 1,226,500

- 9,358,665
**TOTAL LIABILITIES**

- 14,025,038 1,292,500 (365,095) 14,952,443

**MEMEBERS' EQUITY** Members' Equity 4,328,338 7,059,406 (21,508) (4,328,338) 7,037,898 Accumulated Other Comprehensive Income

- - - - - **TOTAL MEMBERS’ EQUITY** 4,328,338 7,059,406 (21,508) (4,328,338) 7,037,898

**TOTAL LIABILITIES & EQUITY 4,328,338**  **21,084,444 1,270,992**  **(4,693,433) 21,990,341** 

**See Independent Accountant's Review Report**

# Ultimate Jet LLC
**Statement of Income**
**For the Period Ended December 31, 2012**

**Ultimate Ultimate**  **Consolidated**

**Ultimate JetCharters**  **Real Estate Total** 
**Jet LLC LLC**  **LLC Eliminations**  **12/31/2012**

**Sales**

- 41,346,372 139,349 (139,349) 41,346,372

**Cost of Sales**

- 28,524,745

- - 28,524,745

- **Gross Profit**

**- 12,821,627**  **139,349 (139,349)**  **12,821,627**

**Selling, General, and Admin. Exp**

- 9,528,069 152,463 (139,349) 9,541,183

- **Net Income From Operations**

**- 3,293,558**  **(13,114)**

**- 3,280,444** 

Other Income

- 1,480

- - 1,480

Other Expense

- (516,802) (55,562)

- (572,364)

**Net Income Before Taxes**

**- 2,778,236**  **(68,676)**

**- 2,709,560** 

**Provision For Income Taxes**

- - - - -

**Net Income (Loss)**

**- 2,778,236**  **(68,676)**

**- 2,709,560** 

**See Independent Accountant's Review Report**

# Ultimate Jet LLC **Supporting Schedules**
**For the Period Ended December 31, 2012**

**Ultimate Ultimate**  **Consolidated**

**Ultimate JetCharters**  **Real Estate Total** 
**Jet LLC LLC**  **LLC Eliminations**  **12/31/2012**

**Sales**

Sales - Charter Services & Fuel

- 41,346,372

- 41,346,372

Rental Income

- - 139,349 (139,349)

- **Total Sales**

**- 41,346,372**  **139,349 (139,349)**  **41,346,372**

**Cost of Sales**

Cost of Sales - Charter Services & Fuel

- 28,524,745

- 28,524,745
**Total Cost of Sales**

**- 28,524,745** 

**- -**  **28,524,745**

**Selling, General, and Administrative Expenses** Salaries & Wages

- 6,307,135

- - 6,307,135
FICA

- 397,581

- - 397,581 Unemployment

- 95,597

- - 95,597

Industrial Insurance

- 67,511

- - 67,511 Employee Insurance & Benefits

- 279,701

- - 279,701 Shop Supplies

- 11,135

- - 11,135
Small Tools

- 2,636

- - 2,636 Flowage Fees

- 40,337

- - 40,337 Repairs & Maintenance

- 58,073

**-** - 58,073 Depreciation - Buildings & Equipment

- 870,825 23,590

- 894,415

Insurance

- 92,289

- - 92,289

Electric

- 21,151

- - 21,151 Laundry & Uniforms

- 6,650

- - 6,650 Equipment Rental

- 84,569

- - 84,569 Freight

- 73,865

- - 73,865 Land & Building Rent

- 140,426 29,305 (139,349) 30,382

Real Estate Tax

- 22,575

**-** - 22,575

Heat

- 8,950

**-** - 8,950
Other Utilities

- 2,427

**-** - 2,427 Licenses, Permits & Fees

- 14,110

**-** - 14,110 Advertising

- 275,667

**-** - 275,667 Membership Dues & Publications

- 40,416

**-** - 40,416 Travel Expense

- 58,340

**-** - 58,340 Training Expense

- 163,315

**-** - 163,315

Meals & Entertainment

- 15,529

**-** - 15,529 Telephone

- 44,738

**-** - 44,738 Office Supplies

- 36,122

**-** - 36,122 Legal

- 55,934

**-** - 55,934

Professional Fees

- 42,895

**-** - 42,895

Bank Fees

- 67,998 20,568

- 88,566 Consulting Fees

- - 79,000 79,000 Computer Expense

- 65,857

**-** - 65,857

Television & Internet

- 8,237

**-** - 8,237
Taxes - Other

- 52,778

**-** - 52,778 Miscellaneous Expense

- 2,700

**-** - 2,700 **Total Selling, General, and Administrative Expenses** 

**- 9,528,069**  **152,463 (139,349)**  **9,541,183**

**See Independent Accountant's Review Report**

# Ultimate Jet LLC **Supporting Schedules**
**For the Period Ended December 31, 2012**

**Ultimate Ultimate**  **Consolidated**

**Ultimate JetCharters**  **Real Estate Total** 
**Jet LLC LLC**  **LLC Eliminations**  **12/31/2012**

**Other Income**

Discount Earned

- 563

- - 563

Interest Income

- 917

- - 917

**Total Other Income**

**- 1,480** 

**- -**  **1,480**

**Other Expense** Interest Expense

- 450,726 53,746

- 504,472
Loss on Sale of PP&E

- 8,781

- - 8,781 Amortization Expense

- 2,303 1,816

- 4,119 Finance Charges

- 69,233

- - 69,233
Nondeductible Fines/Penalties

- (14,241)

- - (14,241) **Total Other Expense**

**- 516,802**  **55,562**

**- 572,364** 

**See Independent Accountant's Review Report**Ultimate Jet LLC

Balance Sheet as of

3/31/2013

Unaudited

Assets
Cash - $

Accounts Recievable - $

Notes Recievable - Shareholder - $

Interest Recievable - Shareholder - $

Investment in Ultimate JETCHARTERS LLC 47,168.00 $ Investment in Ultimate Real Estate LLC 4,281,170.00 $

Total Assets 4,328,338.00 $

Liabilities & Owners Equity Accounts Payable - $

Notes Payable - $

Members Equity 4,328,338.00 $

Retained Earnings - $

Current Year Profit/Loss - $

Total Liabilities & Equity 4,328,338.00 $

checksum

- $Ultimate Jet LLC

Profit and Loss Statement for the Period

01/1/2013 to 03/31/2013

Income

Revenue - $

Expense Cost of Operations - $

Gross Profit - $

SG&A Expenses - $

EBITDA - $

Interest Income Interest Expense - $ Depreciation - $

Net Income (Loss) - $

### 1 Notes to the Ultimate Jet LLC March 31, 2013 Interim Financial Statements

NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Ultimate Jet LLC (hereinafter “UJ” or the “Company”) is an Ohio Limited Liability Company formed as a holding company for other business ent ities. It commenced operations on October 1, 2010. UJ presently has two wholly-owned subsidiaries:

- Ultimate JETCHARTER LLC, an Ohio Limited Liability Company: a full-service, air charter and fixed base operator located at the AkronCanton Regional Airport in Ohio.

- Ultimate Real Estate LLC, an Ohio Limit ed Liability Company: an owner/lessor of real property.

The financial results of these subsidiaries have not been consolidated in UJ’s March 31, 2013
interim financial statements.

The Company is a limited liability company. The member s' liability is limited to their investment.

The Company headquarters is located in North Canton, Ohio at the Akron-Canton Regional Airport.

Use of Estimates

Management uses estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and reported revenues and expenses.

Trade Receivables

The Company has no trade receivables.

Prepaid Expenses

The Company has no prepaid expenses.

Investments

Investments are at stated cost plus earnings reinvested. The value does not reflect current market value of unrealized gains or losses. On March 31, 2013, UJ held 100% equity interests in the following entities:
Amount Invested

Ultimate JETCHARTER LLC $4,281,170

Ultimate Real Estate LLC $ 47,168

### 2 Notes to the Ultimate Jet LLC March 31, 2013 Interim Financial Statements (continued)

Inventory

UJ has no inventory.

Property and Equipment

The Company has no property or equipment.

Accounts Payable

UJ has no accounts payable.

Short Term Liabilities

UJ has no short term liabilities.

Long Term Liabilities

The Company has no long term liabilities.

Income Taxes

The Company has elected to be treated as a Partnership for federal and state income tax purposes. UJ's taxable income or losses, as well as, certain other tax attributes, are passed through directly to the Company's members and are reported in each member's individual income tax return. Consequently, these consolidated financial statements do not include any provision for federal or state income tax expense or liability.

NOTE B - COMMITMENTS AND CONTINGENCIES

The Company had at March 31, 2013, no important unfilled contracts for the purchase of material, merchandise, or equipment in excess of normal requirements or at prices substantially in excess of market at that date; or for the performance of services at prices that are expected to result in a loss upon completion.

The Company has adopted the guidance for uncertainty in income taxes in FASB ASC 740-10- 65-1. The Company will record a liability for uncertain tax positions when it is probable that a loss has been incurred and the amount can be reasonably estimated. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings.

The Company's evaluation on March 31, 2013 revealed no tax positions that would have a material impact on the financial statements. The 2010, 2011, and 2012 tax years remain subject to examination by the IRS. In addition, the tax years 2010, 2011, and 2012 remain subject to examination by certain states. The Company does not believe that any reasonably possible changes will occur within the next six months that will have a material impact on the financial

statements.

### 3 Notes to the Ultimate Jet LLC March 31, 2013 Interim Financial Statements (continued)

NOTE C – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through April 22, 2013, the date which the
financial statements were available to be iss ued. No events have occurred which would have a material effect on the financial statements of the Company.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 1 

### Note 1. Nature of Business and Significant Accounting Policies

Nature of Business

Ultimate JETCHARTERS LLC (the “Company”) is a Part 135 Air Taxi operator located at the Akron Canton Regional Airport in Ohio. In addition to aircraft charter services, the Company sells fuel and provides maintenance services fr om its fixed base operation at the Akron-Canton regional airport.

The Company is an Ohio limited liability company. The members' liability is limited to their

investment.

The Company was formed as an Ohio “C” corp oration in 2003. Shortly after it was formed, it acquired the Air Taxi, fueling, and aircraft maintenance business assets of Gordon Air Management, Inc., an Ohio corporation. Th e Company conducted those operations from 2003 until 2007, when it sold its operating assets to Ultimate Jet Charter Acquisitions, Inc., a Delaware corporation. In September 2010, the Co mpany was acquired by Ultimate Jet LLC and continued its Air Taxi, fueling, and aircraft maintenance oper ations. Concurrent with the acquisition by Ultimate Jet LLC, the Company filed a Certificate of Conversion with the Ohio Secretary of State changing its en tity type from a corporation to a Limited Liability Company.

The Company owns aircraft and has entered into lease arrangements with the owners of various 30 seat Dornier 328 jets, providing ch arter flight services to a va riety of customers. There are two types of aircraft leases. U nder the first type is a “dry l ease” under which the Company makes a fixed monthly payment to the owner to use the aircraft and the Company is responsible for all costs of operations and maintenance. Under the te rms of the second type of aircraft lease, the

owner of the aircraft receives 90% of the revenue and is respon sible for all of the aircraft’s ownership, maintenance, and operating expenses.

The complied financial statements of the Compan y reflect the application of certain policies

described in this note.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimate s and assumptions that affect certain reported

amounts and disclosures. Acco rdingly, actual results could differ from those estimates.

Concentration of Credit Risk

The Company maintains its cash in bank depos it accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts, and management believes it is not exposed to any significant credit risk on cash.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 2 

### Note 1. Nature of Business and Significant Accounting Policies (Continued)

The Company grants credit to customers, substa ntially all of which are located in the United States of America. The Company has a comprehe nsive credit management program that includes ongoing credit evaluation of its customers, genera lly does not require colla teral, and monitors potential credit losses. Credit lo sses have historically been w ithin management’s expectation.

Revenue Recognition

Revenue from passenger transportation is recogni zed when provided. Revenue from sales of fuel and maintenance are recognized on a time-and-mate rial basis. Deposits received on flights are

recorded as unearned revenue and recognized at the time services are provided.

Deposits received from customers for flights that will take place in the future are recorded in

account 2330-00-00 Unearned Revenue on the balance sheet. The amounts in accounts receivable include any amounts in the Compa ny’s USDOT public charter escrow account. These deposits are recognized as sales in come at the time services are provided. If se rvices are not provided to the customer by the Company, the depos it is generally returned to the customer. The Company may retain a percentage of the deposit as cancellation fee if th e customer cancels the trip or is otherwise responsible for the trip not taking place. The Company always adheres to USDOT requirements when making ref unds to public charter passengers.

At March 31, 2013, the Company’s Unearned Revenue account had $119,664 of customer deposits for trips scheduled to take place in the future.

Fair Value of Financial Instruments

The carrying amounts of financial instruments, including cash, accounts receivable, accounts payable, accrued liabilities, and short-term borro wings approximates fair value due to the short maturity of these instruments. The carrying am ount of long-term debt approximates fair value

because the interest rates fluc tuate with market interest.

Cash & Cash Equivalents

For purpose of the statement of cash flows, th e Company considers all highly liquid debt instruments purchased with a maturity of thr ee months or less to be cash equivalents.

Accounts Receivable

Accounts receivable are carried at the original invoice amount less an estimate made for doubtful

receivables based on a review of all outstanding amounts on a monthly basis. Management

determines the allowance for doubtful accounts by identifying troubled accounts. At March 31, 2013, management had determined that no allowa nce for doubtful receivables was required.

Receivables are written off when deemed uncoll ectible. Recoveries of receivables previously

written off are recorded when received.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 3 

### Note 1. Nature of Business and Significant Accounting Policies (Continued)

Inventories

Inventories consist of aircraft replacement parts, fuel, and supp lies held for resale. Inventories

are valued at the lower of cost or market. Cost is determined by the fi rst-in, first-out (FIFO)

method.

Property and Equipment

Property and equipment are recorded at cost. Gains and losses on disposition of property and equipment are recognized as a component of cu rrent operations. Maintenance and repairs are expensed as incurred. Provisions for depreciation are computed pr incipally by using the straightline method. Useful lives of property and equipment are as follows:

Building 40 years Aircraft 12 years Equipment and tooling 7-10 years Furniture and fixtures 7 years Vehicles 5 years Leasehold Improvements 20 years

Depreciation expense for the 11 month peri od beginning January 1 2013 and ending March 31, 2013 was $287,304

The Company records all depreciation at year e nd. Therefore, the inter im financial statements dated March 31, 2013 do not reflect the accumulate d depreciation. Adjusting for depreciation, the net profit before amortization and taxes at March 31, 2013 is $1,048,875.

Impairment of Long-Lived Assets

The Company assesses potential impa irment to its long-lived assets when events or changes in circumstances have made recovery of the asse ts carrying value unlikel y and the carrying amount

of the assets exceeds the estimated future undisc ounted cash flows. If the assessment indicates that the carrying amounts may not be recoverable, an impairment loss would reduce the assets carrying amount to its estimated fair value base d on the present value of the estimated future

cash flows.

Advertising

The Company expenses advertising as incurr ed. For the calendar quarter ended March 31, 2013, advertising expenses were $37,858.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 4 

### Note 1. Nature of Business and Significant Accounting Policies (Continued)

Presentation of Sales Taxes

The State of Ohio imposes a sales tax on cer tain of the Company’s sales to nonexempt customers. The Company collects that sales tax from customers and remits the entire amount to the State. The Company’s accounting policy is to exclude the tax collected and remitted to the

State from revenues and cost of sales.

Intangible Assets

Loan Closing costs of $38,913 are being amortized on the straight-line method over the life of the loans ranging from 3-5 years. Accumulated amortization at January 1, 2013 related to loan closing costs was $4,119.

Amortization expense for the period January 1, 2013 to March 31, 2013 was $2,404.

The Company records all amortization at year e nd. Therefore, the inter im financial statements dated March 31, 2013 do not reflect the accumulate d depreciation. Adjusting for amortization and depreciation, the net pr ofit at March 31, 2013 is $1,046,471.

The estimated amortization expense for the remai nder of 2013 and each of the next 4 years is as

follows:

2013 $9,617 2014 $9,617 2015 $7,324 2016 $5,031 2017 $3,205

Income Taxes

The Company has elected to be treated as a Partnership for federal and state income tax purposes. The Company’s taxable income or losses, as well as, certain other tax attributes, are passed through directly to the Company’s me mbers and are reported in each member’s individual income tax return. Consequently, th ese consolidated financial statements do not include any provision for fede ral or state income tax expense or liability.

Note 2. Short-Term Borrowings

Short-term notes payable consists of a revolvi ng line of credit of up to $1,750,000. At March 31, 2013, the balance was $928,304. This note is secured by security interest in all assets of the Company including but not limited to inventory, accounts receivable, aircraft, and fixed assets.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 5 

### Note 2. Short-Term Borrowings (continued)

Interest is payable monthly at an interest rate per a nnum equal to the rate being asked on an amount of Eurodollar deposits equal to the amount of advances subject to LIBOR Rate election on the first day of a LIBOR Interest Period and which has a maturity corresponding to the maturity of the LIBOR Interest Period, as repor ted by Telerate rate reporting system (or any successor) as determined by the Lender by noon on the effective date of the LIBOR Interest

Period (rounded upwards, if n ecessary, to the next 1/8 th 

### of 1%) (the “LIBOR Rate”), plus 350 basis points. The interest rate at March 31, 2013 was 4.26%. Any outstanding principal and

interest is due at ma turity on July 12, 2013.

The Company pays the Lender an unused portion fee in an amount equal to one-quarter of one percent (.25%) per annum of the average daily un-borrowed principal amount available under the Revolving Loan as computed by Lender. The unused portion fee is paid quarterly.

Note 3. Long-Term Debt

Long-term debt consists of the following at March 31, 2013:

Principal Amount

Term Loan, due July 31, 2015 $ 866,667 Note Payable for 359 SK Jet, due November 20, 2017 $2,722,319 Note Payable for 406 Aircraft, due November 30, 2012 $3,508,654 Note Payable for 411FJ $2,676,848 Note Payable for Vehicle, due October 28, 2016 $18,709 Note Payable – Ultimate Real Estate LLC $309,095 Note Payable -Officer $1,458,398 Total: $11,560,690

The Term Note is secured by security interest in all assets of the Co mpany including but not limited to inventory, accounts receiv able, aircraft, and fixed assets. Interest is payable monthly at an interest rate per annum equal to the rate being asked on an amount of Eurodollar deposits equal to the amount of advances subject to LI BOR Rate election on the first day of a LIBOR Interest Period and which has a maturity corres ponding to the maturity of the LIBOR Interest Period, as reported by Telerate ra te reporting system (or any successor) as determined by the Lender by noon on the effective date of the LIBOR Interest Period (rounded upwards, if

necessary, to the next 1/8 th of 1%) (the “LIBOR Rate”), plus 400 basis points. The interest rate at March 31, 2013 was 4.76%. Fixe d principal installments of $16,667.67 are due monthly with any outstanding principal and interest due at maturity on July 31, 2015.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 6 

### Note 3. Long-Term Debt (Continued)

The mortgage loan is secured by security interest in real estate owned by the Company. Interest is payable monthly at an intere st rate per annum equal to the rate being asked on an amount of Eurodollar deposits equal to the am ount of advances subject to LI BOR Rate election on the first day of a LIBOR Interest Period and which has a maturity corresponding to the maturity of the LIBOR Interest Period, as repor ted by Telerate rate reporting system (or any successor) as determined by the Lender by noon on the effectiv e date of the LIBOR Interest Period (rounded

upwards, if necessary, to the next 1/8 th 

### of 1%) (the “LIBOR Rate”) , plus 350 basis points. The interest rate at March 31, 2013 was 4.26%. Fixed principal installments of $5,500 are due monthly with any outstanding principal and interest due at maturity on July 31, 2017.

The Company has three notes payabl e collateralized by aircraft. Th e first bears interest at the 4.69%. Payments are $30,250 including principal and interest until October 20, 2017 when the remaining balance is payable in full. The s econd bears interest at 7.44%. Payments are $32,000 per month and was due November 30, 2012. The Lender has not called the loan and the Company continues to pay $32,000 per month as it negotiates loans w ith other banks. The Company considers this loan as long-term since it is probable that the lo an will be refinanced with another Lender. The loan is being re ported under similar condi tions currently being negotiated. In February 2013, the Company purchased an aircraft (N411FJ) that it previously had a lease arrangement with the aircraft owners. The company financed the aircraft purchase and

was able to relieve the account receiva ble from the aircraft owners of $1,784,878.

The note payable for vehicle is secured by a 2013 Dodge Cara van. Installments of $466.14 including interest of 3.858% ar e due monthly to October 28, 2016.

The amount of interest cost incurred for the period ended March 31, 2013 was $134,407, all of which was charged to operations.

Maturities of long-term debt for 2013 and succeeding years are as follows:

2013 $ 642,150 2014 $653,355 2015 $992,412 2016 $498,572 2017 $5,755,929

Note 4. Lease Obligations

Operating Leases

The Company conducts its operations from fac ilities that are leased under a five-year noncancelable operating lease expiri ng in July 2013. There is an opti on to renew the lease for two successive additional periods of five years each at an increased monthly rental.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 7 

### Note 4 – Lease Obligations (Continued)

In addition, the Company leases aircraft under operating leases expiring in various years through December 31, 2013. Certain of these leases contain options to rene w the lease for successive one
year terms.

The Company may also rent prop erty, equipment, and transporta tion equipment on an as needed

basis.

Minimum future rental payments under the con- cancelable operating lease having a remaining term in excess of one year as of January 1, 2013 for each of the next three years and in the
aggregate are:

Year Amount 2013 $ 1,240,481

2014 0

2015 0 Subsequent to Year 2015 0

Total Minimum Future Rental Payments: $ 1,240,481

Total rent expense under operating leases for the period January 1, 2013 to March 31, 2013 was $211,894.

Note 5. Related Party Transactions

The Company leases two aircraft from an entity which is owned by an individual who is also a member of the Company. The terms of the leases are comparable to the Company’s other aircraft

leases and are described in Note 5.

The Company also had a balance due an indivi dual who is a member of the Company for advances made to the company. The advances are unsecured. The balance owed to the individual as of March 31, 2013 was $1,423,028.

Note 6 -Commitments and Contingencies

The Company had at March 31, 2013, no important unfilled contracts for the purchase of material, merchandise, or equipment in excess of normal requirements or at prices substantially in excess of market at that date; or for the performance of services at prices that are expected to result in a loss upon completion.

The Company has adopted the guidance for uncer tainty in income ta xes in FASB ASC 740-10- 65-1. The Company will record a liability for un certain tax positions when it is probable that a

loss has been incurred and the amount can be reasonably estimated. The Company continually evaluates expiring statutes of limitations, audits, proposed settle ments, changes in tax law and new authoritative rulings.ULTIMATE JETCHARTERS LLC
NOTES TO INTERIM FINANCIAL STATEMENTS 3 Months Beginning January 1, 2013 and Ending March 31, 2013



### 8 

### Note 6 -Commitments and Contingencies (Continued)

The Company’s evaluation on March 31, 2013 reveal ed no tax positions that would have a material impact on the financial statements . The 2010, 2011, and 2012 tax years remain subject to examination by the IRS. In addition, th e tax years 2010, 2011, and 2012 remain subject to examination by certain states. The Company does not believe that any reasonably possible changes will occur within the next twelve mont hs that will have a material impact on the

financial statements.

Note 7 - Government Regulation

Substantially all of the Company’s facilities are subject to federal, stat e, and local provisions regulating the discharge of materials into the environment. Compliance with these provisions has not had, nor does the Company expect such compliance to have , any material effect upon the capital expenditures, net income, financial condi tion or competitive position of the Company. Management believes that its current practices and procedures for the co ntrol and disposition of such waste comply with applicable federal and state requirements.

Note 8 – Subsequent Events

The Company has evaluated subsequent events through April 22, 2013, the date which the

financial statements were available to be issue d. No events have occurred which would have a

material effect on the financial statemen ts of the Company as of that date.