UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K





(Mark
One)




x ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934





For
the Fiscal Year Ended June 30, 2008





OR




o 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: 001-15035





ABLE
ENERGY, INC.


(Exact
name of registrant as specified in its charter)








Delaware
            
            22-3520840(State or other
      jurisdiction of incorporation or organization)
            
            (I.R.S. employer
      identification No.)198 Green Pond
      Road
              Rockaway, NJ
            
            07866(Address of
      principal executive offices)
            
            (Zip code)






Registrant's
telephone number, including area code: (973) 625-1012





Securities
registered pursuant to Section 12(b) of the Act: None





Securities
registered pursuant to Section 12(g) of the Act:





Common Stock, Par value
$.001 Per Share


(Title of
class)





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Exchange Act. Yes o No x





Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No x





Indicate
by check mark whether 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 registrant was required to
file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes o No x





Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) 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 amendment to this Form 10-K o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.  See the definitions of “large accelerated filer”,
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act (Check one):




Large Accelerated
      Filer o
            Accelerated Filer
      oNon-Accelerated
      Filer o
            Smaller reporting
      company x


(Do not
check if s smaller reporting company)





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No x





The
aggregate market value of the common stock held by non-affiliates of the
registrant was approximately $2.7 million on December 31, 2007, based on the
last reported sales price of the registrant’s common stock on the Pink Sheets on
such date. All executive officers, directors and 10% or more beneficial owners
of the registrant’s common stock have been deemed, solely for the purpose of the
foregoing calculation, “affiliates” of the registrant.





As of
November 14, 2008, there were 14,965,389 shares of the registrant’s common
stock, $.001 par value, issued and outstanding.











ABLE ENERGY, INC. AND SUBSIDIARIES


FORM
10-K


For
the Years Ended


June
30, 2008 and 2007





TABLE
OF CONTENTS








Page
      No.PART IITEM 1.
            Business
            3ITEM 1A.
            Risk
    Factors
            16ITEM 1B.
            Unresolved Staff
      Comments
            25ITEM 2.
            Properties
            25ITEM 3.
            Legal
      Proceedings
            26ITEM 4.
            Submission of
      Matters to a Vote of Security Holders
            28PART IIITEM 5.
            Market for
      Registrant’s Common Equity, Related Stockholder Matters and
      Issuer Purchases of Equity Securities
            29ITEM 6.
            Selected Financial
      Data
            31ITEM 7.
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operation
            31ITEM 7A.
            Quantitative and
      Qualitative Disclosures About Market Risk
            41ITEM 8.
            Financial Statements
      and Supplementary Data
            41ITEM 9.
            Changes In and
      Disagreements With Accountants on Accounting and Financial
      Disclosure
            41ITEM 9A.
            Controls
      and Procedures
            41ITEM 9B.
            Other
      Information
            43PART IIIITEM 10.
            Directors and
      Executive Officers of the Registrant
            45ITEM 11.
            Executive
      Compensation
            50ITEM 12.
            Security Ownership
      of Certain Beneficial Owners and Management and Related
      Stockholder Matters
            51ITEM 13.
            Certain
      Relationships and Related Transactions, and Director
Independence
            59ITEM 14.
            Principal Accountant
      Fees and Services
            60PART
      IVITEM 15.
            Exhibits, Financial
      Statement Schedules
            62Signatures
            
            67Exhibit
    31.1Exhibit
    31.2Exhibit
    32.1Exhibit
    32.2




2




PART
I





Item 1.
Business





Forward-Looking
Statements





Certain
matters discussed herein may constitute forward-looking statements and as such
may involve risks and uncertainties.  In this Report, the words
“anticipates,” “believes,” “expects,” “intends,” “future” and similar
expressions identify certain forward-looking statements.  These
forward-looking statements relate to, among other things, expectations of the
business environment in which we operate, projections of future performance,
perceived opportunities in the market and statements regarding our mission and
vision.  Our actual results, performance, or achievements may differ
significantly from the results, performance or achievements expressed or implied
in such forward-looking statements.  For discussion of the factors
that might cause such a difference, see “Item 7.  Management’s
Discussion and Analysis of Financial Condition and Results of
Operation”.  We undertake no obligation to update or revise such
forward-looking statements.





General





Able
Energy, Inc. (“Able”) was incorporated on March 13, 1997, in the state of
Delaware. Its current subsidiaries are Able Oil Company, Inc. (“Able Oil”), Able
Energy New York, Inc. (“Able NY”), Able Oil Melbourne, Inc. (inactive, as of
February 8, 2008), (“Able Melbourne”), Able Energy Terminal, LLC,
PriceEnergy.com Franchising, LLC (inactive), Able Propane, LLC (inactive),
PriceEnergy.com, Inc. (“PriceEnergy”) and All American Plazas, Inc.
(“Plazas”).  Able, together with its operating subsidiaries, are
hereby referred to as the Company.





Overview





During
the year ended June 30, 2008, the Company’s total revenues were $276.4
million.  The Company is engaged in two primary business activities,
organized in two segments; the Oil Segment and the Travel Plaza
Segment.





The
Company’s Oil Segment, consisting of Able Oil, Able NY, Able Melbourne, Able
Energy Terminal, LLC and PriceEnergy, is engaged in the retail distribution of,
and the provision of services relating to, #2 home heating oil, propane gas,
kerosene and diesel fuels. In addition to selling liquid energy products, the
Company offers complete heating, ventilation and air conditioning (“HVAC”)
installation and repair and other services and also markets other petroleum
products to commercial customers, including on-road and off-road diesel fuel,
gasoline and lubricants.  During the year ended June 30, 2008, the Oil
Segment accounted for $74.5 million of the Company’s net revenues.  On
February 8, 2008, the Company sold the assets and liabilities of Able Melbourne
to a former employee of Able Melbourne.  Please refer to Able
Melbournebelow
for further disclosure relating to this sale.  Please refer to Note 21
- Subsequent Events, found in the Notes to the Consolidated Financial
Statements, for disclosure relating to the July 22, 2008 sale of 49% of the
common stock of Able NY and the sale of a portion of the Company’s Oil Segment
operations in Easton and Horsham PA (“Able PA”) and the subsequent right granted
to the Company on October 31, 2008 to repurchase those shares of stock in Able
NY and the interest in Able PA.





The
Company’s Travel Plaza Segment, operated by Plazas, is engaged in the retail
sale of food, merchandise, fuel, personal services, onsite and mobile vehicle
repair, services and maintenance to both the professional and leisure driver
through a current network of 10 travel plazas, located in Pennsylvania, New
Jersey, New York and Virginia.  During the year ended June 30, 2008,
the Travel Plaza Segment accounted for $201.9 million of the Company’s net
revenues.





Oil
Segment





During
the year ended June 30, 2008, sales of heating oil accounted for approximately
73% of the Oil Segment’s net revenues. The remaining 27% of revenues were from
sales of gasoline, diesel fuel, kerosene, propane gas, home heating equipment
services, central air conditioning sales and service and related sales. As of
the date of this Annual Report, the Oil Segment currently serves approximately
29,000 home heating oil customers from three locations, which are located in
Rockaway, New Jersey, Easton, Pennsylvania and Warrensburg, New
York.





The Oil
Segment also provides installation and repair of heating equipment as a service
to its customers. The Oil Segment considers service and installation, repair and
other services to be an integral part of its business. Accordingly, the Oil
Segment regularly provides service incentives to obtain and retain customers.
The Oil Segment provides home heating equipment repair service on a 24
hour-a-day, seven day-a-week basis, generally within four hours of request.
Except in isolated instances, the Oil Segment does not provide service to any
person who is not a customer as an incentive to become a customer of the Oil
Segment.




3




The Oil
Segment believes that it obtains new customers and maintains existing customers
by offering full service home energy products at competitive prices, providing
quick response refueling and repair operations, providing automatic deliveries
to customers by monitoring historical use and weather patterns, and by providing
customers a variety of payment options. The Oil Segment also regularly provides
service incentives to obtain and retain customers. The Oil Segment aggressively
promotes its services through a variety of direct marketing media, including
mail and telemarketing campaigns, by providing discounts to customers who refer
new customers to the Oil Segment, and through an array of advertising, including
television advertisements, newspaper advertising, refrigerator magnets and
billboards, which aim to increase brand name recognition.





The Oil
Segment intends to expand its operations by acquiring select operators in the
Oil Segment’s present markets as well as other markets, capturing market share
from competitors through increased advertising and other means, diversifying its
products, diversifying its customer base and replicating its marketing and
service formula in new geographic areas. The Oil Segment may also enter into
marketing alliances with other entities in product areas that are different from
the Oil Segment’s current product mix.





Retail
Fuel Oil Distribution





The Oil
Segment's retail fuel oil distribution business is conducted through the
Company’s subsidiaries Able Oil, Able NY and Able Melbourne (until February 8,
2008 at which time the Company sold the assets and certain of the liabilities of
the Melbourne operation). The Oil Segment serves both residential and commercial
fuel oil accounts. The Oil Segment sells premium quality #2 home heating oil to
its residential customers offering delivery seven days a week. To its commercial
customers, in addition to selling heating oil, the Oil Segment sells diesel
fuels, lubricants, gasoline and kerosene. The Oil Segment also provides an oil
burner service that is available 24 hours a day for the maintenance, repair and
installation of oil burners. These services are performed on an as needed basis.
Customers are not required to enter into service contracts to utilize the Oil
Segment's service department; however, the Oil Segment does offer such service
contracts, if desired.





Approximately
41% of the Oil Segment's customers receive their home heating oil pursuant to an
automatic delivery system without the customer having to make an affirmative
purchase decision. Based on each customer’s historical consumption patterns and
prevailing weather conditions, the Oil Segment’s computers schedule these
deliveries.  Customers can also order deliveries of home heating oil
through the Oil Segment's website located at www.ableenergy.com, or the website
of the Company's subsidiary, PriceEnergy at www.priceenergy.com. The Oil Segment
delivers home heating oil approximately six times each year to the average
customer. The Oil Segment bills customers promptly upon delivery or receives
payment upon delivery. The Oil Segment’s customers can pay for fuel deliveries
with cash, check, electronic account debit or credit card.





In
addition, approximately 14% of the Oil Segment’s customers have an agreement
that pre-establishes the maximum annual sales price of fuel oil and is paid by
customers over a ten-month period in equal monthly installments. Such prices are
renegotiated in April of each year and the Oil Segment has historically
purchased fuel oil for these customers in advance and at a fixed
cost.





The Oil
Segment delivers with its own fleet of 33 custom fuel oil trucks, 3 propane
trucks and 4 owner-operator fuel oil delivery trucks. The Oil Segment's fuel
trucks have fuel capacities ranging from 3,000 to 8,000 gallons. Each vehicle is
assigned to a specific delivery route, and services between 4 and 40 customer
locations per day depending on market density and customers' fuel requirements.
The Oil Segment also operates 23 Company-owned service vans and one
owner-operated service van, which are equipped with state of the art diagnostic
equipment necessary to repair and/or install heating equipment. The number of
customers each van serves primarily depends upon the number of service calls
received on any given day.





Able
Oil





Able Oil
was established in 1989 and is the Company's largest Oil Segment subsidiary,
accounting for approximately 63% and 69% of the Oil Segment's total revenues for
the years ended June 30, 2008 and 2007, respectively.  Able Oil is
headquartered in Rockaway, New Jersey, and serves approximately 16,000 oil
customer accounts throughout northern New Jersey, primarily in Morris, Sussex,
Warren, Passaic and Essex counties, from its distribution terminal in Rockaway,
New Jersey and in Pennsylvania, primarily in Northampton and Lehigh counties and
from its distribution terminal in Easton, Pennsylvania. Of these accounts,
approximately 92% are residential customers and 8% are commercial
customers.





Of the
Oil Segment's 33 fuel oil trucks, 30 are reserved for use by Able Oil, of which
25 trucks operate from the Rockaway facility and 5 trucks operate from the
Easton, Pennsylvania facility. In addition, Able Oil utilizes the services of
five owner-operated trucks. Each owner-operator is under contract with the
Company, which provides that each owner operator is responsible for all
vehicle-operating expenses including insurance coverage.  All of the
trucks, including the owner-operated trucks, are well marked with the Oil
Segment's logo and contact information.




4




Able
Oil's fuel oil delivery trucks, which operate from the Rockaway facility, and
the owner-operator trucks, acquire fuel inventory at the Company's terminal
facility in Rockaway, New Jersey. Dispatch of fuel oil trucks is conducted from
the Rockaway terminal facility. Billing is conducted from the Company’s
corporate headquarters in Rockaway.





The
Rockaway and Newton (which is currently out of service) facilities have the
capacity to store 3.0 million gallons and 200,000 gallons of fuel, respectively.
Please refer to Note 21 - Subsequent Events, found in the Notes to the
Consolidated Financial Statements in Item 8 of this Annual Report for disclosure
regarding the Company's lease of the Newton facility. During seasons where
demand for heating oil is higher, or when wholesale oil prices are favorable, a
slightly larger inventory is kept on hand. However, management generally
believes that high inventory turnover enables the Oil Segment to rapidly respond
to changes in market prices. Thus, management typically employs a "just in time"
inventory practice and rarely stores fuel to capacity levels. Additional fuel
oil purchases are made daily on the spot market using electronic funds
transfers. Able Oil transports its fuel purchases from wholesale purchase sites
to its Rockaway facility with two tractor-trailer tankers owned by the Oil
Segment, and by other outside vendors that are contracted by the Oil Segment to
provide additional fuel transport capacity.





Able
Oil's oil burner service operates out of the Route 46 facility in Rockaway, New
Jersey. Able Oil dispatches a total of 19 service vans, plus one owner-operated
service van.





Please
refer to Note 21 - Subsequent Events, found in the Notes to the Consolidated
Financial Statements in Item 8 of this Annual Report, for disclosure relating to
the Company’s July 22, 2008 sale of 90% of its interest in Able Oil’s Easton and
Horsham, Pennsylvania operations and the subsequent right granted to the Company
on October 31, 2008 to repurchase that interest by the Company.





Able
Melbourne





Able
Melbourne (currently inactive, see below) was established in July 1996, and was
located in Cape Canaveral, Florida. For the year ended June 30, 2008, revenues
from Able Melbourne accounted for approximately 5% of the Oil Segment's total
revenue. Able Melbourne was engaged primarily in the sale of diesel fuel for
commercial fleet fueling and other on-road vehicles, and dyed diesel fuel, which
was used for off-road vehicles and purposes, including commercial and
recreational fishing vessels, heating oil, and generator fuel. Additionally, a
small portion of Able Melbourne's revenue was generated from the sale of home
heating oil, lubricant and lubricant products.Able Melbourne served
approximately 200 customer accounts in Brevard County, Florida, primarily in the
Cape Canaveral area.





Able
Melbourne delivered fuel with two fuel delivery trucks, which were capable of
storing 6,000 gallons of fuel, in the aggregate. Because Able Melbourne's peak
season was at the opposite time of the year than the rest of the Oil Segment’s,
during this season, Able Melbourne used one of Able Oil's trucks to meet its
demands. Able Melbourne did not have facilities to store fuel oil beyond what
was held on its trucks, and thus, purchased fuel inventory from local
refineries. However, since Able Melbourne is located only three miles from the
bulk storage facility, the lack of inventory capacity was not material to the
Oil Segment's operations or revenues.





On
February 8, 2008 (the “Closing Date”), the Company and Able Melbourne executed
an Asset Purchase Agreement (“APA”) with Able Oil of Brevard, Inc. (“Able
Brevard”), a Florida corporation, owned by a former employee of Able
Melbourne.  For consideration in the amount of $375,000, the APA
provided for the sale to Able Brevard of all of the tangible and intangible
assets (excluding corporate books and records), liabilities and lease
obligations of Able Melbourne, as is, on the Closing Date.  As a
result of this transaction, the Company recorded a loss on the sale in the
amount of $121,634, of which $40,000 was accrued to expense in the year ended
June 30, 2007 and the balance of $81,634 was charged to expense in the year
ended June 30, 2008.





Able
NY





Able NY
is engaged in the retail distribution of #2 home heating oil, in addition to
kerosene, propane gas and propane gas equipment and also provides related
services to its customer base in the Warren, northern Saratoga, and
southern Essex Counties of upstate New York.





The
retail and commercial heating oil and diesel fuel operations are similar to
those of Able Oil.  Able NY has its office and storage located in an
industrial park off of Route 9 in Warrensburg, New York.  There is
storage capacity for 67,500 gallons of heating oil, kerosene and
diesel.  This is currently the only Oil Segment location that stores
and sells propane gas.  Propane gas can be used for virtually all
household and business utility applications. Although burned as a gas, propane
is transported as a liquid and stored in tanks that vaporize the liquid for use.
Able NY provides its propane customers with such tanks, some at no charge, and
by doing so, remains such customers’ exclusive supplier of propane. Able NY
employs a delivery system similar to the Oil Segment's retail oil distribution
business, whereby customers receive propane deliveries pursuant to an automatic
delivery system without the customer having to make an affirmative purchase
decision.  Based on each customer’s historical consumption patterns
and prevailing weather conditions, Able NY’s computers schedule these
deliveries.  A small percentage of its customers prefer to order
refill deliveries on their own schedule and Able NY accommodates those requests
as appropriate.




5




Able NY
conducts its propane operations from its storage facility in Warrensburg, New
York, which has 60,000 gallons of propane storage capacity. The delivery trucks
have the capacity to deliver 3,000 gallons of propane, and can service
approximately 35 customers per day. Able NY purchases wholesale propane on the
spot market at local facilities and utilizes the services of contract carriers
to bring the product to its Warrensburg facility.





Please
refer to Note 21 - Subsequent Events, found in the Notes to the Consolidated
Financial Statements in Item 8 of this Annual Report, for disclosure relating to
the Company’s July 22, 2008 sale of 49% of the common stock of Able NY and the
subsequent right granted to the Company on October 31, 2008 to repurchase those
shares of stock in Able NY.





PriceEnergy





PriceEnergy
started business in October 2000, and as of June 30, 2008 was a 67.3% owned
subsidiary of Able.  On September 22, 2008, the Company’s ownership
interest in PriceEnergy was increased to 92%. See, Note 21 - Subsequent
Events to the Notes to the Consolidated Financial Statements in Item 8 of this
Annual Report.  PriceEnergy was developed in order to bring about
efficient transactions in the liquid fuels market by streamlining the ordering
and delivery process utilizing Internet technology. PriceEnergy has developed a
business technology platform that enables it to sell and deliver liquid fuels
and related energy products. This has been possible by utilizing a branded
distribution channel of dealers and the Oil Segment’s own delivery network. By
leveraging its proprietary Internet technology and wireless dispatch platform,
PriceEnergy has achieved cost leadership while providing it with a competitive
advantage in the industry.





As of the
date of this Annual Report, PriceEnergy has a network of 66 dealers in eight
states in the Northeast and Mid-Atlantic regions. PriceEnergy customers order
products and services from PriceEnergy over the Internet and then PriceEnergy
computers forward the orders to the local dealer to schedule delivery on behalf
of PriceEnergy.





During
the period from July 28, 2006 to August 15, 2006, PriceEnergy entered into
future contracts for #2 heating oil to hedge a portion of its forecasted heating
season requirements. PriceEnergy purchased 40 contracts through a broker for a
total of 1,680,000 gallons of #2 heating oil at an average call price of $2.20
per gallon. Due to warmer than average temperatures through the heating season,
as of June 30, 2007, PriceEnergy experienced a substantial drop in fuel
consumption and price, resulting in a loss on these
contracts.  Through June 30, 2007, PriceEnergy deposited a total of
$923,017 in margin requirements with the broker and realized a loss of $923,017
on 40 closed contracts representing 1,680,000 gallons.





PriceEnergy
processed orders for approximately 5.8 million gallons of #2 home heating oil
over the Internet through PriceEnergy.com in the fiscal year ended June 30,
2008.





Travel Plaza
Segment





Acquisition
of Travel Plaza Assets





On May
30, 2007, the Company completed its business combination with its largest
shareholder, All American Plazas, Inc. a Pennsylvania
corporation.  Subsequent to the business combination, All American
Plazas, Inc. changed its name to All American Properties, Inc. (“Properties”).
This business combination resulted in the Company acquiring the operating assets
of eleven multi-use truck stop plazas, formerly operated by Properties, and
assuming certain of Properties debt. (One of the acquired plazas, Strattanville,
Pennsylvania, was subsequently shut-down in April, 2008 due to unprofitable
operations at that site.)  Properties retained ownership of the
underlying real property on which each of the acquired travel plazas was
situated.  Able formed a new wholly-owned subsidiary, All American
Plazas, Inc. (“Plazas”), a Delaware corporation, to operate the acquired
plazas.  Able also acquired a ten year option to acquire any of the
travel plaza real estate owned by Properties, providing that the Company assume
all existing debt obligations related to the applicable properties or refinance
the existing debt with a new loan.  The option has been valued at $5.0
million and is exercisable as long as the Plaza’s leases relating to the
applicable real estate remain in effect.  The Plaza leases
automatically renew, upon the mutual consent of Plazas and Properties, for
consecutive one-year terms so that the total term of each lease shall be for a
period of ten years.





The
Company issued to Properties 10 million restricted shares of its common stock in
consideration for the business combination, which was approved by more than 90%
of the Company’s disinterested stockholders at a special meeting of Able's
stockholders held on August 29, 2006.





In
addition, the Company issued 1,666,667 shares in the name of Properties, held in
escrow. In the event that Able's Board, in exchange for additional consideration
from Properties, agrees to assume Properties obligations as to certain
convertible debentures it had previously issued, then the escrowed shares will
be issued to the debenture holders that elect to convert their debentures into
Able common stock, with any remaining escrowed shares to be released to
Properties. The Board's determination to assume the convertible debentures will
be based on whether or not the debenture holders elect to convert their
respective debentures into shares of the Company’s common stock and the
additional consideration to be provided by Properties. In the event that the
debenture holders do not elect to convert or the Board does not agree to assume
the debenture obligations, then all of the shares held in escrow will be
released to Properties.




6




As a
result of the closing of the business combination with Properties, as of May 30,
2007, Able had 14,808,090 shares of common stock issued and outstanding (which
includes the 1,666,667 shares held in escrow). As of May 30, 2007, Properties
was the owner of record of 12,666,667 shares of the Company’s common stock
(including the shares held in escrow), or approximately 85.5% of Able's
outstanding shares. The closing price of the Company’s common stock on May 30,
2007 was $1.65.





Both
Properties and its controlling stockholder have agreed to a voting lock-up of
the shares that Properties holds in Able regarding election of members of the
Company’s Board until such time as Properties and its majority stockholder no
longer hold a majority of Able's issued and outstanding shares of common
stock.





Approximately
85% of the common stock of Properties is owned by the Chelednik Family Trust, a
trust established by Frank Nocito, an officer of the Company, and his wife for
the benefit of their family members.  In addition, pursuant to an
agreement between the Chelednik Family Trust and Gregory Frost, through an
entity controlled by him and his wife (Crystal Heights, LLC), Gregory Frost, the
Company’s Chief Executive Officer and Chairman of the Board of Directors, is the
beneficial holder of the balance of the outstanding common stock of
Properties.





Travel
Plaza Operations




The
Company’s Travel Plaza Segment is engaged in the retail provision of food,
merchandise, fuel, lodging (in select locations), personal services, onsite and
mobile vehicle repair, services and maintenance to both the professional and
leisure driver through a current network of 10 travel plazas, located in
Pennsylvania, New Jersey, New York and Virginia.   Two of the
locations are operated under a Petro franchise, three operate under the Gables
brand name and the remaining travel plazas operate under the All American Plazas
banner.  The Travel Plaza Segment’s operations range from full service
facilities, such as the Milton Petro in Milton Pennsylvania, to facilities with
more limited amenities, such as the Gables of Harrisburg, located in Harrisburg,
Pennsylvania.




The
Travel Plazas Segment’s facilities are designed to offer a number of benefits to
truck fleet operators and drivers.  These benefits generally include
well-lit and fenced parking lots to enhance security for drivers, trucks, and
freight; spacious parking areas and traffic flow patterns designed to reduce
accidents; and fewer stops and out-of-route miles through the use of one-stop,
multi-service facilities.  The facilities offer separate gas and
diesel fueling islands, restaurants, truck preventative maintenance and repair
services and travel and convenience stores offering an array of merchandise
selected to cater to professional truck drivers’ needs during their long periods
away from home.  Additionally, the Travel Plazas provide amenities
such as telephones, fax machines, computers and other communication services,
photocopying and postal services.  The Travel Plazas also offer
certified truck weighing scales, truck washes, laundry facilities, private
showers, game, television and movie rooms, and barber shops.  Set
forth below is information with respect to each of the Travel Plazas operated by
the Company’s wholly-owned subsidiary, All American Plazas, Inc.




Frystown All American,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
50 acre irregularly shaped site conveniently located on the west side of Route
645, less than 1/4 mile south of exit 10 of Interstate 78.  The
property is equipped with restaurant/driver amenities (showers, lounge, etc.)
and a motel/convenience store facility.  The stop was built in
1972.  A part metal-and-concrete block five-bay truck repair building
and a metal maintenance building are 100% occupied.  The improvements
encompass approximately 30,000 square feet.




Clarks Ferry All American,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
7.4 acre irregularly shaped site conveniently located on the east side of
Benvenue Road (Route 22/322), less than 1/2 mile south of US Route 11 /
15.  The property is equipped with a 17,100 square foot truck stop
facility that was built in 1990 and is 100% occupied.  The
improvements include 8,800 square foot one-story (with a basement)
restaurant/driver amenities (showers, lounge, etc), convenience store facility,
a 2,000 square foot two-story single-family house, a 2,500 square foot two-story
8-unit single room facility, a 2,700 square foot two-story management building,
and a 1,100 square foot two-story concrete maintenance building.




Breezewood Petro,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
7.7 acre irregularly shaped site conveniently located just south of Route 30,
just east of Interstate 70 and just west of Interstate 76. The property is
equipped with a 16,500 square foot truck stop facility that was built in 1963
and is 100% occupied. The improvements include a 14,400 square foot one-story
(with a basement) restaurant/driver amenities /convenience store facility, and a
2,100 square foot two-story concrete-block truck repair building. An action has
been commenced by the franchisor against Properties and Plazas for an alleged
breach of the Petro franchise agreement with respect to this plaza. Plazas
believes it has adequate defenses and counterclaims with respect to this action.
See, Note 21, Subsequent Events – Litigation, in the notes to the Consolidated
Financial Statements in Item 8 of this Annual Report.




7




Carlisle Gables,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
8.0 acre irregularly shaped site conveniently located off of Interstate 81 (Exit
52) as well as Interstate 76, or the Pennsylvania Turnpike (Exit 16). The site
is equipped with a brick 3,500 square foot one-story gasoline
station/convenience store and truck wash building that was built in 1987 and is
100% occupied. Effective November 1, 2008, All American Plazas, Inc.
(“Plazas”) subleased the operation of this plaza to an independent third party
for a term of three years. Plazas determined the sublease of this facility would
cut its costs, but maintained the right to supply the fuel to this plaza on a
cost plus basis which it believes will result in a net profit to the Company.
The sublease provides for the purchase of the existing inventory. See, Note 21,
Subsequent Events – Sublease of the Plazas, in the notes to the Consolidated
Financial Statements in Item 8 of this Annual Report.




Frystown Gables,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
10 acre irregularly shaped site conveniently located on the east side of Route
645, less than 1/4 mile south of Exit 10 of Interstate 78. The property is
equipped with a masonry-panel 2,200 square foot one-story gasoline
station/convenience store facility including amenities (showers) that was built
in 1990 and is 100% occupied. There are approximately an additional 40 acres of
industrial/commercial-zoned land located adjacent to this facility that has been
approved for subdivision, but no plans are currently in place to develop the
land.  Effective November 1, 2008, All American Plazas, Inc. subleased
the operation of this plaza to an independent third party for a term of three
years. Plazas determined the sublease of this facility would cut its costs, but
maintained the right to supply the fuel to this plaza on a cost plus basis which
it believes will result in a net profit to the Company. The sublease provides
for the purchase of the existing inventory and a three month abatement of rent.
See, Note 21, Subsequent Events – Sublease of the Plazas, in the notes to the
Consolidated Financial Statements in Item 8 of this Annual Report.




Doswell All American,
Virginia




The
facility is comprised of a full-service truck stop situated on an approximately
54.3 acre irregularly shaped site conveniently located on the northeast quadrant
of King’s Dominion Boulevard (Route 30) and Interstate 95 (Exit 98),
approximately 12 miles north of Richmond, Virginia. Approximately 20 acres of
this facility consist of business-zoned land that has been approved for a
recreational vehicle park. The property consists of a two-story restaurant,
retail, and restaurant/retail/service building, a two-story EconoLodge Motel,
and a truck wash and service building built in 1964. The motel is a concrete
block structure with 86 rooms, and the truck wash and service building is a
concrete block structure with two wash and five service bays. The building area
encompasses approximately 81,400 square feet. On May 12, 2008, Plazas entered
into a sale agreement with T.S.O., Inc. (“TSO”) for the sale of Plaza’s assets
located at its leased Doswell, VA travel plaza.  In exchange for total
consideration to Plazas of approximately $0.4 million, Plazas has agreed to
transfer to TSO title to all tangible and intangible assets (excluding corporate
records) and liabilities relating to the operations of the Doswell, VA travel
plaza.  Under the sale agreement, TSO had until October 12, 2008 to
obtain and deliver a firm commitment letter for the purchase price. By letter
dated November 6, 2008, the owner of the real property underlying the Doswell
travel plaza sent a notice to TSO terminating the contract of
sale.  During the period July 12, 2008 through termination of the
contract of sale, TSO is obligated to pay the Company rent in the amount of
$75,000 per month.




All American Belmont, New
York




The
facility is comprised of a full-service truck stop situated on an approximately
9.4 acre irregularly shaped site conveniently located off of State Route 17
(Exit 30) and at the  intersection of State Route 19 and County Road
20. The site is equipped with a frame one-story gasoline station/convenience
store building (amenities not included) as well as two ancillary storage sheds
(450 SF and 120 SF). The buildings were built in 1977, renovated in 1999, and
are 100% occupied.




All American Carney’s Point,
New Jersey




This
facility is comprised of a full-service truck stop situated on an approximately
11.0 acre irregularly shaped site conveniently located off of Interstate 95
(Exit 1), or the New Jersey Turnpike as well as Interstate-295 (Exit 2). The
property is equipped with a masonry one-story gasoline station, convenience
store/restaurant building (amenities not included) as well as a truck garage
building. The buildings were built in 1970, renovated in 1995, and are 100%
occupied. The two buildings have an aggregate area of 9,500 square feet.
Properties, the owner of the real property underlying this plaza, sought to
refinance the property because the term of the loan with the lender was about to
terminate. Properties was unable to refinance due to current economic conditions
resulting in the lender obtaining a judgment of foreclosure. However, the
parties are continuing to discuss a restructuring of the loan and Plazas is also
considering its right of purchase by refinancing the existing loan encumbering
the property. To date neither the lender nor Properties has taken any steps to
terminate the lease and Plazas continues to operate this plaza.




8




Harrisburg Gables,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
9.7 acre irregularly shaped site conveniently located on the north side of
Linglestown Road (Route 39), approximately 1/4 mile east of Exit 27 off of
Interstate 81 in Harrisburg. The property is equipped with a brick 4,300 square
foot one-story gasoline station/convenience store (amenities not included) and
Subway franchise that was built in 1991 and is 100% occupied. Effective November 1,
2008, All American Plazas, Inc. (“Plazas”) subleased the operation of this plaza
to an independent third party for a term of three years. Plazas determined the
sublease of this facility would cut its costs, but maintained the right to
supply the fuel to this plaza on a cost plus basis which it believes will result
in a net profit to the Company. The sublease provides for the purchase of the
existing inventory. See, Note 21, Subsequent Events - Sublease of the Plazas, in
the notes to the Consolidated Financial Statements in Item 8 of this Annual
Report.




Milton Petro,
Pennsylvania




This
facility is comprised of a full-service truck stop situated on an approximately
71.9 acre irregularly shaped site conveniently located on the south side of
Route 254, less than 1/4 mile west of Exit 215 of Interstate 80 in Milton. The
property is equipped with concrete-block truck stop facilities encompassing
37,000 square feet. These facilities were built in 1992, are 100% occupied and
include a 275-seat restaurant, a travel/convenience store, a driver’s lounge, a
truck wash, showers, scales, and a 5-bay truck repair shop. Separate actions
have been commenced against Properties and Plazas by the holder of the mortgage
of the real property underlying the plaza. In addition, an action has been
commenced by the franchisor against Properties and Plazas for an alleged breach
of the Petro franchise agreement with respect to this plaza. Plazas believe it
has adequate defenses and counterclaims with respect to these actions. See, Note
21, Subsequent Events – Litigation, to the Notes to the Consolidated Financial
Statements in Item 8 of this Annual Report.




All American Plazas at
Strattanville




This
facility is comprised of a full-service truck stop situated on an approximately
63.9 acre irregularly shaped site conveniently located on the north side of
Route 322, less than a 1/4 mile south of exit 70 of Interstate 80 in
Strattanville. Approximately 35 acres of this site is considered excess land.
The property is equipped with a masonry-panel 16,650 square foot two-story
multi-purpose rest area, amenities (showers) and a 5,925 square foot garage
facility.  The Company determined in April 2008 to close this plaza
since it was experiencing substantial, continuing losses. The Company is
presently considering reopening the facility, but limiting its operations to the
sale of gasoline and the convenience store and restaurant located on the
premises.





Related Parties
Financing





Properties
Financing





On June
1, 2005, Properties completed a financing that may impact the Company. Pursuant
to the terms of the Securities Purchase Agreement (the "Agreement") among
Properties and certain purchasers (“Purchasers”), the Purchasers loaned
Properties an aggregate of $5,000,000, evidenced by Secured Debentures dated
June 1, 2005 (the "Debentures").  The Debentures were due and payable
on June 1, 2007, subject to the occurrence of an event of default, with interest
payable at the rate per annum equal to LIBOR for the applicable interest period,
plus 4% payable on a quarterly basis on April 1st, July
1st,
October 1st and
January 1st,
beginning on the first such date after the date of issuance of the
Debentures.  Upon the May 30, 2007 completion of the business
combination with Properties and the Company’s board approving the transfer of
the debt that would also require the transfer of additional assets from
Properties as consideration for the Company to assume this debt, then the
Debentures are convertible into shares of our common stock at a conversion rate
of the lesser of (i) the purchase price paid by us for issuance of our
restricted common stock for the assets of Properties upon completion of the
business combination, or (ii) $3.00, subject to further adjustment as set forth
in the agreement.





The loan
is secured by real estate property owned by Properties in Pennsylvania and New
Hampshire.  Pursuant to the Additional Investment Right (the “AIR
Agreement”) among Properties and the Purchasers, the Purchasers may loan
Properties up to an additional $5,000,000 of secured convertible debentures on
the same terms and conditions as the initial $5,000,000 loan, except that the
conversion price will be $4.00.  Pursuant to the Agreement, these
Debentures are in default, as Properties did not complete the business
combination with the Company prior to the expiration of the 12-month anniversary
of the Agreement.




9




Subsequent
to the consummation of the business combination, we may assume the obligations
of Properties under the Agreement.  However, the Company’s board of
directors must approve the assumption of this debt, which requires that
Properties transfer additional assets or consideration for such assumption of
debt.  Based upon these criteria, it is highly unlikely the Company
will assume the obligations of Properties, including the Debentures and the AIR
Agreement, through the execution of a Securities Assumption, Amendment and
Issuance Agreement, Registration Rights Agreement, Common Stock Purchase Warrant
Agreement and Variable Rate Secured Convertible Debenture Agreement, each
between the Purchasers and us (the “Able Energy Transaction
Documents”).  Such documents provide that Properties shall cause the
real estate collateral to continue to secure the loan, until the earlier of full
repayment of the loan upon expiration of the Debentures or conversion by the
Purchasers of the Debentures into shares of our common stock at a conversion
rate of the lesser of (i) the purchase price paid by us for issuance of our
restricted common stock for the assets of Properties upon the completion of the
business combination, or (ii) $3.00, (the “Conversion Price”), subject to
further adjustment as set forth in the Able Energy Transaction
Documents.  However, the Conversion Price with respect to the AIR
Agreement shall be $4.00.  In addition, the Purchasers shall have the
right to receive five-year warrants to purchase 2,500,000 of our common stock at
an exercise price of $3.75 per share.  Pursuant to the Able Energy
Transaction Documents, the Company also has an optional redemption right (which
right shall be mandatory upon the occurrence of an event of default) to
repurchase all of the Debentures for 125% of the face amount of the Debentures
plus all accrued and outstanding interest, as well as a right to repurchase all
of the Debentures in the event of the consummation of a new financing in which
we sell securities at a purchase price that is below the Conversion
Price.  The stockholders of Properties have agreed to escrow a
sufficient number of shares to satisfy the conversion of the $5,000,000 in
outstanding Debentures in full.  As of the date of this Annual Report,
the Company has not assumed any of Properties’ obligations with respect to the
Debentures.





July
27, 2005 Loan to Properties





The
Company loaned Properties $1,730,000 as evidenced by a promissory note dated
July 27, 2005. As of June 30, 2008, this note and related interest was paid
in-full. The interest income related to this note for the years ended June 30,
2008 and 2007 was $152,721 and $164,350, respectively.





Manns
Haggerskjold of North America, Ltd. (“Manns”) Agreement





On May
19, 2006, the Company entered into a letter of interest agreement with Manns,
for a bridge loan to the Company in the amount of $35,000,000 and a possible
loan in the amount of $100 million based upon the business combination with
Properties ("Manns Agreement"). The terms of the letter of interest provided for
the payment of a commitment fee of $750,000, which was non-refundable to cover
the due-diligence cost incurred by Manns. On June 23, 2006, the Company advanced
to Manns $125,000 toward the Manns Agreement due diligence fee. During the
period from July 7, 2006 through November 17, 2006, the Company advanced an
additional $590,000 toward the Manns Agreement due diligence fee. The amount
outstanding relating to these advances as of June 30, 2007 was
$715,000.  As a result of not obtaining the financing (see below), the
entire $715,000 was expensed to amortization of deferred financing costs in the
twelve month period ended June 30, 2007.





As a
result of the Company receiving a Formal Order of Investigation from the SEC on
September 7, 2006, the Company and Manns agreed that the commitment to fund
being sought under the Manns Agreement would be issued to Properties, since the
Company’s stockholders had approved a business combination with Properties and
since the collateral for the financing by Manns would be collateralized by real
estate owned by Properties. Accordingly, on September 22, 2006, Properties
agreed that in the event Manns funds a credit facility to Properties rather than
the Company, upon such funds being received by Properties, it will immediately
reimburse the Company for all expenses incurred and all fees paid to Manns in
connection with the proposed credit facility from Manns to the
Company.  On or about February 2, 2007, Properties received a term
sheet from UBS Real Estate Investments, Inc. (“UBS”) requested by Manns as
co-lender to Properties. Properties rejected the UBS offer as not consistent
with the Manns’ commitment of September 14, 2006. Properties subsequently
demanded that Manns refund all fees paid to Manns by the Company and Properties.
In order to enforce its rights in this regard, Properties has retained legal
counsel and commenced an arbitration proceeding against Manns and its
principals.  See, “Item 3. Legal Proceedings”.
The Company and Properties intend to pursue their remedies against Manns. All
recoveries and fees and costs of the litigation will be allocated between the
Company and Properties in proportion to the amount of the Manns due diligence
fees paid.





Laurus
Master Fund, Ltd. (“Laurus”) Agreement





On July
5, 2006, the Company received $1,000,000 from Laurus in connection with the
issuance of a convertible term note.  Of the proceeds received from
Laurus in connection with the issuance of the convertible term note, the Company
loaned $905,000 to Properties in exchange for a note
receivable.  Properties used such proceeds to pay (i) certain
obligations of CCI Group, Inc. (“CCIG”) and its wholly-owner subsidiary, Beach
Properties Barbuda Limited (“BPBL”), which owned and operated an exclusive
Caribbean resort hotel known as the Beach House located on the island of
Barbuda, and (ii) a loan obligation owed by BPBL to Laurus which loan was used
by CCIG to acquire the Beach House.  Properties had previously
acquired a 70% interest in CCIG pursuant to a Share Exchange
Agreement.  The Company received from Laurus a notice of a claim of
default dated January 10, 2007.  Laurus claimed
  10
  default
under section 4.1(a) of the Term Note as a result of non-payment of interest and
fees in the amount of $8,826 that was due on January 5, 2007, and a default
under sections 6.17 and 6.18 of the securities purchase agreement for “failure
to use best efforts (i) to cause CCIG to provide Holder on an ongoing basis with
evidence that any and all obligations in respect of accounts payable of the
project operated by CCIG’s subsidiary, BPBL, have been met; and (ii) cause CCIG
to provide within 15 days after the end of each calendar month,
unaudited/internal financial statements (balance sheet, statements of income and
cash flow) of the Beach House and evidence that BPBL and the Beach House are
current in all of their ongoing operational needs”.




The
aforementioned interest and fees were paid by the Company on January 11, 2007.
Further, the Company has used its best efforts to cause CCIG to provide reports
and information to Laurus as provided for in the securities purchase
agreement.





In
connection with the claim of default, Laurus claimed an acceleration of maturity
of the principal amount of the Note of $1,000,000 and approximately $154,000 in
default payment (“Default Payment”) as well as accrued interest and fees of
approximately $12,000. On March 7, 2007, Laurus notified the Company that it
waived the event of default and that Laurus had waived the requirement for the
Company to make the Default Payment.  The Company and Laurus are in
discussions to modify the term of the loan.





Effect of Change in General
Economy





The
Company's business is relatively unaffected by business cycles. Because fuel
oil, propane and gasoline are such basic necessities, variations in the amount
purchased as a result of general economic conditions are limited; however, the
Company is affected by the cost of fuel it purchases for resale to its
residential and commercial customers as well as weather conditions, especially
regarding the sale of heating oil.





Customer
Stability





The Oil
Segment has a relatively stable customer base due to the tendency of homeowners
to remain with their traditional distributors. In addition, a majority of the
homebuyers tend to remain with the previous owner's distributor. As a result,
the Oil Segment’s customer base each year includes most customers retained from
the prior year, or homebuyers who have purchased from such customers. Like many
other companies in the industry, the Oil Segment delivers fuel oil and propane
to each of its customers an average of six times during the year, depending upon
weather conditions and historical consumption patterns. Most of the Company's
customers receive their deliveries pursuant to an automatic delivery system,
without the customer having to make an affirmative purchase decision each time
home heating oil or propane is needed. In addition, the Oil Segment provides
home heating equipment repair service on a seven-days-a-week basis. No single
customer accounts for 10% or more of the Oil Segment’s consolidated
revenues.  Based upon current economic conditions, the Company
anticipates certain of its customers to experience credit problems which may
have an unfavorable effect on the Company’s sales.





The
Travel Plaza Segment also has a relatively stable customer base due to the
tendency of both the professional and leisure drivers to remain with their
traditional, familiar service providers.  As a result, the Travel
Plaza’s customer base includes most customers retained from prior years. Like
many other companies in the industry, the Travel Plaza Segment’s operation
delivers fuel, food and related travel services and merchandise to their
customers 24 hour a day.  No single customer accounts for 10% or more
of the Travel Plaza Segment’s consolidated revenues. Based upon current economic
conditions, the Travel Plaza Segment has and continues to experience an
approximate 35% reduction in over the road truck traffic, which negatively
impacts the Travel Plaza Segment sales of fuel and merchandise.




Product
Lines





The
Travel Plaza Segment accounted for $201.9 million of the Company’s revenue for
the year ended June 30, 2008.  Of this amount, approximately 86%
related to fuel sales with the balance related to lodging, food, services,
maintenance and merchandise sales.  The Travel Plaza Segment
facilities generally operate 24 hours a day, seven-days-a-week.





In fiscal
year 2008, sales of #2 heating oil accounted for approximately 73% of the Oil
Segment's revenues. The remaining 27% of revenues were from sales of gasoline,
diesel fuel, kerosene, propane, home heating equipment services and related
sales. The Oil Segment installs heating equipment and repairs such equipment on
a 24 hours a day, seven-days-a-week basis, generally within four hours of
request.





Industry
Overview





The
Company's businesses are highly competitive.




11


In
addition to competition from alternative energy sources, the Oil Segment
competes with distributors offering a broad range of services and prices, from
full service distributors similar to the Oil Segment, to those offering delivery
only. Competition with other companies in the propane industry is based
primarily on customer service and price. Longstanding customer relationships are
typical in the retail home heating oil and propane industry. Many companies in
the industry, including the Oil Segment, deliver fuel oil or propane to their
customers based upon weather conditions and historical consumption patterns
without the customers having to make an affirmative purchase decision each time
fuel oil or propane is needed. In addition, most companies, including the Oil
Segment, provide equipment repair service on a 24 hour-a-day basis, which tends
to build customer loyalty. As a result, the Oil Segment may experience
difficulty in acquiring new retail customers due to existing relationships
between potential customers and other fuel oil or propane
distributors.





In
addition to competition from much larger, better financed travel plaza
operators, the Travel Plaza Segment competes with operators offering a broad
range of services and prices, from full service establishments similar to the
Travel Plaza Segment, to deep discount operators offering only
fuel.  Competition with other companies in the travel plaza industry
is based primarily on customer service, location, hours of operation and price.
Longstanding customer relationships are typical in the industry.  In
addition, most travel Plaza operators, including the Travel Plaza Segment;
provide service on a 24 hour-a-day basis, which tends to build customer
loyalty.  As a result, the Travel Plaza Segment may experience
difficulty in acquiring new customers due to existing relationships between
potential customers and their current providers, competitive pricing and new or
upgraded travel plaza operators.





Research and
Development





During
the past two fiscal years ending June 30, 2008, the Company has not engaged in
any research and development activities.





Marketing, Sales and
Strategic Partnerships





The Oil
Segment believes that it obtains new customers and maintains existing customers
by offering its full service home energy products at discount prices, providing
quick response in refueling and repair operations, providing automatic
deliveries to customers by monitoring historical use and weather patterns, and
by providing customers a variety of payment options. To expand its customer base
and aggressively promote its service, the Oil Segment engages in direct
marketing campaigns, advertises regularly, offers employee incentives and
encourages referrals.





The Oil
Segment has successfully expanded its customer base by employing a variety of
direct marketing tactics, including telemarketing campaigns, billboards, mass
and direct mailings and by distributing hand-bills and promotional items, such
as refrigerator magnets, sweatshirts and hats. Additionally, the Oil Segment's
delivery personnel are an integral part of the Company's direct marketing
activities. While in the field, drivers isolate potential new customers by
taking note of where the Oil Segment is not servicing accounts, and act as
salespersons for the Oil Segment.





The Oil
Segment uses advertising campaigns to increase brand recognition and expand its
customer base, including radio and television advertisements, billboards, and
newsprint and telephone directory advertisements. Additionally, the Oil Segment
utilizes its fleet of fuel delivery trucks and service vans as moving
advertisements by emblazoning them with the Oil Segment's logo.





Historically,
referrals have been an important part of the Oil Segment's efforts to expand its
business and the Oil Segment offers incentives to customers who refer business.
The Oil Segment also offers other special limited time promotions designed to
increase business in specific targeted business segments. The Company also
encourages civic and religious organizations to refer business to the Oil
Segment through group rate discounts.





The
Travel Plaza Segment utilizes numerous marketing, sales and partnership
arrangements to promote its products, services and merchandise.  The
Travel Plaza Segment makes extensive use of partnerships and co-ops with
nationally known travel service providers.  This approach provides our
travel plaza guests and customers with immediate comfort in knowing they are
receiving the best service and products from nationally recognized
providers.  For example, our locations distribute nationally known
brand name products, welcome guests into nationally recognized, top quality
restaurants and fast food courts, offer market priced lodging accommodations in
our nationally recognized hotels (at selected locations), provide professional
drivers with innovative, cutting edge pod technology, including access to air
conditioning, telephone, cable, including on-demand programming, and Internet
access, all in the comfort of their cab.  In addition, we provide our
guests with well-stocked merchandise and convenience stores and numerous
personal services.




12




In
addition to word-of-mouth advertising, the Travel Plaza Segment advertises our
services and locations on interstate highway billboards, the Internet, and
through trade association websites and newsletters.  From time-to-time
we advertise restaurant or merchandise specials in local newspapers to both
maintain and grow our local customer base.  We have also entered into
non-binding loyalty service agreements with regional and national corporations
and professional driver associations, offering special billing and credit terms,
discounts on products and services and cross promotional benefits that encourage
guests to visit our other travel plaza locations.  Our roadside
service vehicles serve as moving advertisements, displaying the livery of their
home travel plaza location.





Patents and
Trademarks





The
Company owns the exclusive right and license to use, and to license others to
use, the proprietary marks, including the service marks "Able Energy” (and
design) ("Able Energy Proprietary Marks") and "Able Oil" (and design) ("Able Oil
Proprietary Marks").





Presently
there is no effective determination by the United States Patents and Trademarks
Office, (“USPTO”), Trademark Trial and Appeal Board, the trademark administrator
of any state, or court regarding the Able Energy or Able Oil Proprietary Marks,
nor is there any pending interference, opposition or cancellation proceeding or
any pending litigation involving the Proprietary Marks or the trade names,
logotypes, or other commercial symbols of Able Oil or Able Energy. There are no
agreements currently in effect that significantly limit the rights of Able Oil
or Able Energy to use or license the use of their respective Proprietary Marks
except that, in connection with the sale of the Able Melbourne assets, the
Company granted the purchaser a perpetual license to use the trademark “Able
Oil” solely within the State of Florida and solely in conjunction with the words
“Melbourne” or “Florida”.





PriceEnergy.com
owns the exclusive right and license to use, and to license others to use, the
proprietary marks, including the service mark "PriceEnergy.com" (and design) and
“PriceEnergy.com The energy hot spot” (and design) ("PriceEnergy Proprietary
Marks").  In addition, PriceEnergy established certain common law
rights to the PriceEnergy Proprietary Marks through its continuous, exclusive
and extensive public use and advertising. The PriceEnergy Proprietary Marks are
not registered in any state. PriceEnergy also owns the domain names
PriceEnergy.com, FuelOilPrices.net, HomeHeatingOilPrices.net,
HeatingOilPrices.net and PriceEnergy.net.





Environmental Considerations
and Regulations





The
Company has implemented environmental programs and policies designed to avoid
potential liability under applicable environmental laws. The Company has not
incurred any significant environmental compliance cost, and compliance with
environmental regulations has not had a material effect on the Company's
consolidated operations or financial condition. This is primarily due to the
Company's general policies of closely monitoring its compliance with all
environmental laws. In the future, the Company does not expect environmental
compliance to have a material effect on its operations and financial condition.
The Company's policy for determining the timing and amount of any environmental
cost is to reflect an expense as and when the cost becomes probable and
reasonably capable of estimation.





Other
than the following disclosures, management is not aware of any other
environmental incident or condition that would cause the potential for
environmental liability.





Environmental
matters relating to the Oil Segment include the following:





Related
to its 1999 purchase of the property on Route 46 in Rockaway, New Jersey, the
Company settled a lawsuit with a former tenant of the property and received a
lump sum settlement of $397,500. This sum was placed in an attorney’s escrow
account for payment of all environmental remediation costs. Through June 30,
2008, Able Energy Terminal, LLC has been reimbursed for approximately $310,500
of costs and another $87,000 are not reimbursed and are included in prepaid
expenses and other current assets in the accompanying consolidated balance sheet
included elsewhere in this filing and must be presented to the attorney for
reimbursement. The environmental remediation is currently in progress on this
property.  The majority of the “free standing product” has been
extracted from the underground water table.  The remainder of the
remediation will be completed over the course of the next eight to ten years
using natural attenuation and possible bacterial injection.





On
September 15, 2003, Able Oil received approval from the New Jersey Department of
Environmental Protection of a revised Discharge Prevention Containment and
Countermeasure plan ("DPCC") and Discharge, Cleanup and Removal plan ("DCR") for
the facility at 344 Route 46 East in Rockaway, New Jersey. This plan has
received approval and will be in effect for three years. The State of New Jersey
requires companies which operate major fuel storage facilities to prepare such
plans, as proof that such companies are capable of, and have planned for, an
event that might be deemed by the State of New Jersey to be hazardous to the
environment. In addition to these plans, Able Oil has this facility monitored on
an ongoing basis to ensure that the facility meets or exceeds all standards
required by the State.




13




On
September 26, 2006, the New Jersey Department of Environmental Protection
(“NJDEP”) conducted a site update inspection, which included a review of the
Route 46 site and an update of the progress of the approved
remediation.  The NJDEP Northern Office director who conducted the
inspection, concluded that the remediation progress was proceeding appropriately
and that the department approved of the Company’s continued plan to eliminate
the remaining underground product.  The Company experienced no spill
events that would warrant investigation by state or other environmental
regulatory agencies. All locations are prepared to deal with such an event
should one occur.





Environmental
regulation for the Travel Plaza Segment generally falls into four primary
categories: (a) sewage treatment plants; (b) storm water and spill runoff
control; (c) tanks and lines used for delivery of petroleum products; and (d)
waste product disposal.  The Travel Plaza Segment owns and operates
three on-site sewage treatment plants at its Pennsylvania locations - Frystown,
Milton, and Clarks Ferry.  All three plants must be monitored and
maintained daily by licensed operators.  The Travel Plaza Segment does
have some employees who are licensed operators but has also engaged the services
of an outside company that specializes in the operation of treatment
plants.  They collect effluent samples, handle all reports that are
submitted monthly to the state and procure any permits as
required.  The plants must all comply with strict standards of
structural integrity and effluent concentrations, as they all discharge directly
to streams and rivers.  Storm water and spill control is critical,
especially at those locations that are adjacent to waterways.





The State
of Pennsylvania maintains an active Underground Storage Tank Indemnification
Fund (“USTIF”).  The Travel Plaza Segment pays money into the USTIF
based on tank capacity for diesel fuel and actual gallons of gasoline
purchased.  The Travel Plaza Segment must also abide by guidelines
relating to the disposal of waste products.  All battery cores are
taken back by their original suppliers.  Tire casings are collected in
trailers and hauled away by a certified recycler, and all oil filters are
crushed and drained prior to disposal.  Waste oil is either burned in
our own heating systems or sold to a certified recycler.





Environmental
matters relating to the Travel Plaza Segment include the following:





Clarks Ferry All
American





This site
has been subject to an ongoing groundwater cleanup program since 1996 when a
claim was filed with the Pennsylvania Underground Storage Tank Indemnification
Fund (“USTIF”).  The remedial action plan has been handled by a third
party contractor since 1998.  Active remediation efforts ceased in
2004 and a three-year period of well monitoring was started in 2005 calling for
six semi-annual well sampling events.




USTIF
coverage for the site was approved at 65% of total remediation
costs.  In 2004, cost estimates to complete the remediation project
were prepared by the third party contractor and Plazas accepted a lump sum
payout from USTIF of approximately $32,000 (65% of $48,000 estimate of
completion costs). In September 2007, the final sampling event was completed and
results were favorable.  A “Post Remedial Care Plan Completion Report”
was submitted to the PA DEP in January 2008 and was accepted the following
month. Monitoring wells were closed in March 2008, and a final billing generated
for the remedial activities.  At June 30, 2008, Plazas owed $8,000 for
completion of these activities.





Frystown All
American





This site
is subject to an ongoing groundwater cleanup program that started in 1998 when
the old tanks and fuel islands were replaced.  Tanks were not leaking,
but lines in the fuel island area had leaked and created the need for soil
removal and groundwater cleanup.  It is also believed that a heating
oil tank removed in the early 90’s was an additional source of
contamination.  The site was accepted by USTIF for 100%
coverage.  The groundwater pump and treat system was activated in
December, 2001 and was shut down in October, 2005, as the monitoring wells came
into compliance.  The quarterly well monitoring period was started in
December, 2005 and has continued through June, 2007.  The final well
sampling event in September 2007 was uneventful.   The contractor
is currently preparing the final site closure report, which will be submitted to
the PA DEP for final closure and concurrence that no further remedial activities
are necessary.





Belmont All
American





This site
has been subject to an ongoing groundwater remediation since 2004, when a leak
was found in a flex hose at a dispenser.  A groundwater filtration
system went online in November, 2005.  Monthly well samples are taken
and good progress is being shown towards the attainment of
compliance.  Full closure of the site is expected within the next
twelve (12) months, with an anticipated cost of approximately $35,000 to
Plazas.





14





Doswell All
American





This site
presently has no underground storage tanks (“UST's”) in use for storage of
petroleum products.  Diesel fuel storage is in two above ground
storage tanks (“AST’s”); one 500,000 gallons and the other is 100,000
gallons.





In
November, 2005, the Virginia Department of Environmental Quality (“VA DEQ”)
issued a violation for an unknown release of petroleum product into a storm
water runoff pond at the site.  Several source areas were identified
and ultimately ruled out, with the exception of an oil/water separator that was
found to have a faulty valve allowing oil runoff to bypass separator and drain
directly to the pond.  A new oil/water separator was put in place in
December, 2005.  On July 9, 2007, the VA DEQ issued a letter canceling
any further action relative to this violation.





In April,
2007, the VA DEQ notified Plazas that, due to a change in regulations with
respect to AST containment requirements, Plazas would be required to make
changes to the existing AST’s and/or containment berm by December 31,
2007.  After consideration of various options to bring the site into
compliance, it was decided that the best alternative was to dismantle the
500,000 gallon AST.





In
November 2007, the 500,000 gallon AST was dismantled and removed from the site
at a cost of approximately $15,000.  Soil borings in the area of the
tank and pad have been clean.  No further cost is anticipated relative
to this project.





Government
Regulations





Numerous
federal, state and local laws, including those relating to protection of the
environment and worker safety, affect the Company's operations. The
transportation of fuel oil, diesel fuel, propane and gasoline is subject to
regulation by various federal, state and local agencies including the U.S.
Department of Transportation ("DOT"). These regulatory authorities have broad
powers, and the Company is subject to regulatory and legislative changes that
can affect the economies of the industry by requiring changes in operating
practices or influencing demand for, and the cost of providing, its
services.





The
regulations provide that, among other things, the Company's drivers must possess
a commercial driver's license with a hazardous materials endorsement. The
Company is also subject to the rules and regulations concerning the Hazardous
Materials Transportation Act. For example, the Company's drivers and their
equipment must comply with the DOT's pre-trip inspection rules, documentation
regulations concerning hazardous materials (i.e. certificates of shipments which
describe the type and amount of product transported) and limitations on the
amount of fuel transported, as well as driver "hours of service" limitations.
Additionally, the Company is subject to DOT inspections that occur at random
intervals. Any material violation of DOT rules or the Hazardous Materials
Transportation Act may result in citations and/or fines upon the Company. In
addition, the Company depends upon the supply of petroleum products from the oil
and gas industry and, therefore, is affected by changing taxes, price controls
and other laws and regulations relating to the oil and gas industry generally.
The Company cannot determine the extent to which future operations and earnings
may be affected by new legislation, new regulations and/or changes in existing
regulations.





The
technical requirements of these laws and regulations are becoming increasingly
expensive, complex and stringent. These laws may impose penalties or sanctions
for damages to natural resources or threats to public health and safety. Such
laws and regulations may also expose the Company to liability for the conduct or
conditions caused by others, or for acts of the Company that were in compliance
with all applicable laws at the time such acts were performed. Sanctions for
noncompliance may include revocation of permits, corrective action orders,
administrative or civil penalties and criminal prosecution. Certain
environmental laws provide for joint and several liabilities for remediation of
spills and releases of hazardous substances. In addition, companies may be
subject to claims alleging personal injury or property damages as a result of
alleged exposure to hazardous substances, as well as damage to natural
resources.





The
Travel Plaza Segment is subject to various governmental
regulations.  These include the collection and payment of taxes,
complying with government standards, and maintaining various government permits
and licenses.  All fuel island equipment must follow the standards set
forth by the Bureau of Weights & Measures.  The bureau inspects
and tests fuel equipment twice annually.  Fuel islands must also have
adequate cut-off switches and systems in the event of an accidental spill or
fire.  The scales at each location are tested
annually.  Each scale operator must have a public weighmaster license,
which is issued by the Bureau of Standard Weights.  Most of the
locations have eating establishments that must follow regulations set forth by
the applicable state, as well as the posting of a license issued annually by the
Department of Agriculture.  Inspections of the Travel Plaza Segment’s
restaurants are performed by the respective states to verify compliance with
restaurant standards for food storage and preparation.  Fire
suppression systems are also required in all cooking areas and are subject to
periodic inspection.  Each retail store is required to post a
Cigarette Dealer license (or similar license).  In Pennsylvania, this
is issued by the Department of Revenue Bureau of Business Trust
Fund.  In Pennsylvania, the Department of Health issues a certificate
of registration, which is required to conduct and maintain a facility in
accordance with the provisions of the Controlled Substance, Drug, Device and
Cosmetic Act #64, approved September 9, 1972.  The Travel Plaza
Segment is also subject to various standard taxes.  These taxes
include federal and state corporate taxes, sales tax, payroll tax, tire
recycling fees and occupancy taxes.  The Travel Plaza Segment also
collects motor fuel




15




taxes
from customers.  These motor fuel taxes are withheld by our suppliers
upon our purchase of fuel and the supplier files and pays the motor fuel
taxes.  The Travel Plaza Segment does not directly file motor fuel tax
returns for gasoline or diesel in Pennsylvania, but does do so in New
Jersey.  All “Pressure Vessels” in Pennsylvania are regulated by the
Bureau of Occupational and Industrial Safety, which is part of the Pennsylvania
Department of Labor and Industry.  Pressure vessels include boilers
that can be a component of a location’s hot water and/or heating system, and
also all air compressors.  Air compressors are used in our truck
repair facilities, and could also be part of a location’s water delivery or HVAC
systems.  They must be registered with the state and are inspected
annually.




Although
the Company believes that it is in compliance with existing laws and regulations
and carries adequate insurance coverage for environmental and other liabilities,
there can be no assurance that substantial costs for compliance will not be
incurred in the future or that the insurance coverage in place will be adequate
to cover future liabilities. There could be an adverse affect upon the Company's
operations if there were any substantial violations of these rules and
regulations. Moreover, it is possible that other developments, such as more
stringent environmental laws, regulations and enforcement policies thereunder,
could result in additional, presently unquantifiable, costs or liabilities to
the Company.





Employees





As of
June 30, 2008, the Company’s full-time employment totaled 501
individuals.





As of
June 30, 2008, the Oil Segment’s full-time employment totaled 70 individuals.
From October through March, the Oil Segment’s peak season, the Oil Segment
employs approximately 120 persons. From April through September, the Oil Segment
generally employs approximately 90 persons. Currently, there are no organized
labor unions representing any of the employees of the Oil Segment or any of its
related companies and management considers relations with its employees to be
good.





As of
June 30, 2008, the Travel Plaza Segment’s full-time employment totaled 431
individuals. Employment levels remain relatively stable throughout the
year.  Currently, there are no organized labor unions representing any
of the employees of the Travel Plaza Segment or any of its related companies and
management considers relations with its employees to be good.





Item
1A.Risk
Factors





Set forth
below are certain risks and uncertainties relating to our business that the
Company has elected to disclose, although not required to do so because we are a
Smaller Reporting Company as defined in Rule 12b-2 of the Securities Exchange Act of
1934, as amended.





You
should
carefully  consider  the  following  information  about  risks
described below, together with the
other  information  contained in this Annual
Report  and in our  other  filings  with
the SEC,  before  you  decide to buy or maintain
an investment in our common stock. We believe the risks described below are the
risks that are material to us as of the filing date of this Annual
Report.  If any of the following risks actually occur, our business
financial condition, operating results and future growth prospects would likely
be material and adversely affected. In these circumstances, the market price of
our common stock could decline, and you may lose all or part of the money you
paid to buy our common stock.





We do not
believe we have, and we are unsure whether we will be able to generate,
sufficient funds to sustain our operations through the next twelve
months.





Our
management believes
that  currently  available  funds  will  not  be
sufficient  to sustain our  operations  at
current  levels  through the next twelve
months.  The Company has incurred losses from continuing operations
during the years ended June 30, 2008 and 2007 of approximately, $12.9 million
and $6.6 million, resulting in an accumulated deficit balance of approximately
$30.6 million as of June 30, 2008. At June 30, 2008, we had $3.0 million in cash
and cash equivalents and a working capital deficiency of $12.9
million.  Our ability to continue to operate at current levels
depends  upon,  among
other  things,  our ability to
generate  sufficient  revenue from  the sale of
our  products  and services
and  the  receipt
of  continued  funding  from our existing
short-term and long-term financing sources.





In the
long-term, our ability to continue as a going concern is dependent on generating
sufficient revenue from product sales and the sale of our services. Our ability
to generate significant revenue from any of these or other sources is
uncertain.  Historically, our operations have not generated sufficient
revenue to cover our costs.  In the event that our operations do not
generate sufficient cash, we could be required to reduce our level of operations
while attempting to raise additional working capital.  We can give no
assurance that additional financing will be available to us on acceptable terms
or at all.  The failure to obtain any necessary additional financing
would have a material adverse effect on us. If adequate funds are not available
or are not available on acceptable terms, our ability to
fund our operations and any intended expansion, to take
advantage of business opportunities, to develop or enhance products or
services or to otherwise respond to competitive pressures would be significantly
limited, and we might need to significantly restrict or
discontinue our operations.




16




The
report of our independent registered public accounting firm on our consolidated
financial statements as of June 30, 2008 and for the year then ended contains
explanatory paragraphs stating that there is substantial doubt as to our ability
to continue as a going concern and to indicate that the June 30, 2006 auditors
did not consent to reissue its report in the filing of the June 30, 2007 Annual
Report on Form 10-K. Our financial statements do not include any adjustments
that might result from the outcome of this uncertainty. This uncertainty may
affect our ability to raise additional capital and may also negatively impact
our relationships with current and potential suppliers and
customers.





These are
not the only risks and uncertainties we face. Additional risks and uncertainties
not presently known to us or that we currently deem to be immaterial may also
impair our business. If any of the following risks actually occur, the business,
operating results or financial condition could be material adversely
affected.





We
have a history of operating losses and expect to sustain losses in the future
and may still sustain losses in the future even if we successfully and
efficiently integrate the assets of Properties into our business





We have
experienced significant operating losses in five out of the last seven fiscal
years.  For the year ended June 30, 2008, we had a loss of
approximately $12.9 million.  We also expect to incur a loss for the
fiscal year ending June 30, 2009.





Managing
our growth may affect financial performance





Our
growth and expansion has required, and will continue to require, increased
investment in management and financial personnel, financial management systems
and controls, as well as facilities.  We intend to continue to expand
our business and operations, including entry into new markets, which will place
additional strain on our management and operations. Our future operating results
will depend, in part, on our ability to continue to broaden our senior
management group and administrative infrastructure, and our ability to attract,
hire and retain skilled employees. Our success will also depend on the ability
of our officers and key employees to continue to implement and improve our
operational and financial control systems and to expand, train and manage our
employee base. In addition, our future operating results will depend on our
ability to expand our sales and marketing capabilities and expand our customer
support operations commensurate with our growth, should such growth occur. If
our revenues do not increase in proportion to our operating expenses, our
management systems do not expand to meet increasing demands, we fail to attract,
assimilate and retain qualified personnel, or our management otherwise fails to
manage our expansion effectively, there would be a material adverse effect on
our business, consolidated financial condition and operating
results.





Substantial
long-term debt may adversely impact our long-term ability to expand





As of
June 30, 2008, we had long-term liabilities of $3.9 million. Our ability to
satisfy such obligations will depend on our future operating performance, which
will be affected by, among other things, prevailing economic conditions and
financial, business and other factors, many of which are beyond our control.
There can be no assurance that we will be able to service our indebtedness. If
we are unable to service our indebtedness, we will be forced to examine
alternative strategies that may include actions such as reducing or delaying
capital expenditures, restructuring or refinancing our indebtedness, or the sale
of assets or seeking additional equity and/or debt
financing.   There can be no assurance that we will be able to
implement any of these strategies even if the need arises.





Growth
dependent upon unspecified acquisitions and adequate financing




Our
growth strategy includes the acquisition of existing fuel distributors and truck
stops. There can be no assurance that we will be able to identify new
acquisition candidates or, even if a candidate is identified, that we will have
access to the capital necessary to consummate such acquisitions. Furthermore,
the acquisition of additional companies involves a number of additional risks.
These risks include the diversion of management's attention from our operations,
possible difficulties with the assimilation of personnel and operations of
acquired companies, the earnings impact associated with the amortization of
acquired intangible assets, and the potential loss of key employees of acquired
companies. The future success of our business will depend upon our ability to
manage our growth through acquisitions. The Company’s objective is to grow our
customer base through mergers and acquisitions. There can be no assurance that
we will have the financing or management and operating personnel to accomplish
this objective.




SEC
formal order of private investigation





On
September 7, 2006, we received a Formal Order of Private Investigation from the
SEC pursuant to which we, certain of our officers and a director were served
with subpoenas requesting certain documents and information.  The
Formal Order authorizes an investigation of possible violations of the
anti-fraud provisions of the federal securities laws with respect to the offer,
purchase and sale of our securities and our disclosures or failures to disclose
material information in our required filings. While we believe that we did not
violate any securities laws and we have cooperated fully with and assisted the
SEC in its inquiry, there can be no certainty with regard to the outcome of the
investigation and there can be no assurance that there will not be a material
adverse effect on us.   The cost of complying with the SEC
investigation may affect our liquidity, consolidated results of operations, and
ability to raise cash through the sale of debt or equity
securities.




17


Trademarks
and service marks




We
believe that our trademarks and service marks have significant value and are
important to the marketing of our travel plaza operations, fuel distribution
products and services. There can be no assurance, however, that our
proprietary marks do not or will not violate the proprietary rights of others,
that our marks would be upheld if challenged or that we would not be
prevented from using our marks, any of which could have an adverse effect on us
and our results of operations. In addition, there can be no assurance that we
will have the financial resources necessary to enforce or defend
our trademarks and service marks against infringement.  Should
there be an infringement, and the Company is unsuccessful in litigation, it may
negatively impact the Company’s revenue.





Liquidity
and going concern uncertainty





Our net
loss for the year ended June 30, 2008, was $12.9 million, including non-cash
charges totaling approximately $3.8 million. The Company has been funding its
operations through financing its receivables and credit card receivables, an
asset-based line of credit, the issuance of convertible debentures and the
proceeds from the exercise of options and warrants.  The Company will need
some combination of new financing, restructuring of existing financing, improved
receivable collections and/or improved operating results in order to maintain
adequate liquidity over the course of the 2009 fiscal
year.





As of
June 30, 2008, the Company had a cash balance of approximately $3.0 million, of
which $1.5 million represents an obligation for funds received in advance under
the pre-purchase fuel program.  At June 30, 2008, the Company had
available borrowings through its credit line facility of $0.8 million.  In
order to meet our liquidity requirements, the Company continues to explore
financing opportunities available to it.





The
Company is attempting to expand the customer base of its Oil Segment and is
pursuing other lines of business, which include expansion of its current
commercial business into other products and services such as bio-diesel, solar
energy and other energy related home services.  The Company is also
evaluating all of its business segments for cost reductions, consolidation of
facilities and efficiency improvements.  There can be no assurance that we
will be successful in our efforts to enhance our liquidity
situation.





The
accompanying Consolidated Financial Statements included elsewhere in this filing
have been prepared in conformity with United States generally accepted
accounting principles, which contemplate continuation of the Company as a going
concern and assume realization of assets and the satisfaction of liabilities in
the normal course of business. The Company has incurred losses from continuing
operations during the years ended June 30, 2008 and 2007 of $12.9 and $6.6
million, respectively.  Net cash used in operations during the years
ended June 30, 2008 and 2007 was $3.6 million and $1.3 million,
respectively.  At June 30, 2008, the Company has a working capital
deficiency of $12.9 million.  These factors raise substantial doubt
about the Company’s ability to continue as a going concern.  The
Consolidated Financial Statements included elsewhere in this filing do not
include any adjustments relating to the recoverability of the recorded assets or
the classification of the liabilities that may be necessary should the Company
be unable to continue as a going concern.





The
Company will require some combination of new financing, restructuring of
existing financing, improved receivable collections and/or improved operating
results in order to maintain adequate liquidity over the course of the year
ending June 30, 2009.   Also, see “Timeliness of future SEC
filings”, below.





There can
be no assurance that the financing or the cost saving measures as identified
above will be satisfactory in addressing the short-term liquidity needs of the
Company.  In the event that these plans cannot be effectively
realized, there can be no assurance that the Company will be able to continue as
a going concern.





A
limited market for our common stock and "Penny Stock" rules may make buying or
selling our common stock difficult





Our
common stock presently trades on the pink sheets. As a result, an investor may
find it difficult to dispose of, or to obtain accurate quotations as to the
price of, our securities.  In addition, our common stock is subject to
the penny stock rules that impose additional sales practice requirements on
broker-dealers who sell such securities to persons other than established
customers and accredited investors.  The SEC regulations generally
define a penny stock to be an equity that has a market price of less than $5.00
per share, subject to certain exceptions.  Unless an exception is
available, those regulations require the delivery, prior to any transaction
involving a penny stock, of a disclosure schedule explaining the penny stock
market and the risks associated therewith and impose various sales practice
requirements on broker-dealers who sell penny stocks to persons other than
established customers and accredited investors (generally
institutions).  In addition, the broker-dealer must provide the
customer with current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customer's account.  Moreover, broker-dealers who recommend such
securities to persons other than established customers and accredited investors
must make a special written suitability determination for the purchaser and
receive the purchaser's written agreement to transactions prior to
sale.  Regulations on penny stocks could limit the ability of
broker-dealers to sell our common stock and thus the ability of purchasers of
our common stock to sell their shares in the secondary market.




18




Our share
price may decline due to a large number of shares of our common stock eligible
for sale in the public markets.  As of June 30, 2008, we had
outstanding 14,965,389 shares of common stock and up to 7,127,524 shares
issuable upon exercise of the Company’s outstanding options, warrants and
convertible debentures. Of the Company’s 14,965,389 outstanding shares,
11,666,667 of these shares were issued in connection with the consummation of
the acquisition of the assets of Properties.  These shares are
restricted and will be held pursuant to Rule 144.  With such a
substantial number of shares eligible for future sale, our stock price may
decline and investors may find it difficult to sell their shares in the open
market at or above their basis in the stock.





Registration
rights agreements





On July
12, 2005, the Company consummated a financing with certain purchasers in the
sale of $2.5 million of Variable Rate Convertible Debentures (the "Debentures").
The Debentures may be converted at the option of the purchasers into shares of
our common stock at a conversion price of $6.50 per share. In addition, the
purchasers of these Debentures received five (5) year warrants to purchase an
aggregate of 192,308 of common stock at an exercise price of $7.15 per share
(the “2005 Warrants”).  Pursuant to the Registration Rights Agreement
among the parties, the Company filed a registration statement covering the
shares of its common stock that may be issued through the conversion of the
Debentures and exercise of the 2005 Warrants.  This registration
statement was declared effective on December 20, 2005.  Since that
date, the purchasers converted into shares of the Company’s common stock
approximately $2.4 million of the principal of the Debentures.  The
Company has an obligation to keep this registration statement effective on a
continuous basis, which obligation the Company breached when it failed to update
the registration statement with new audited consolidated financial statements by
October 31, 2006.  As a result of this breach, the purchasers of the
Debentures are entitled to partial liquidated damages in the amount of 2% of the
aggregate purchase price of the Debentures then held by the purchasers (which
remaining balance of the Debentures at June 30, 2008 is $132,500) for each month
that our breach continues.  There are no liquidated damages for not
maintaining an effective registration statement covering the 2005
Warrants.  The unpaid liquidated damages accrue interest daily based
on the rate of 18% per annum.  Additionally, the Company’s breach of
its registration obligations constitutes a default under the Debentures, which
enables the purchasers to declare the Debentures immediately due and
payable.  As of June 30, 2008, the Company has not received any notice
from the purchasers of the Debentures regarding this registration rights
default.





On July
5, 2006, the Company closed a Securities Purchase Agreement entered into on June
30, 2006 whereby it sold a $1 million convertible term note to Laurus Master
Fund, Ltd. ("Laurus").  In conjunction with this issuance the Company
agreed that within sixty (60) days from the date of issuance of the convertible
term note payable and warrant that it would file a registration statement with
the SEC covering the resale of the shares of the Company's convertible term
common stock issuable upon conversion of the note and the exercise of the
warrant. This registration statement would also cover any additional shares of
common stock issuable to Laurus as a result of any adjustment to the fixed
conversion price of the note or the exercise price of the
warrant.   The agreement does not provide any formula for
liquidated damages.  The Company did not file a registration statement
by August 29, 2006 covering the common stock issuable upon conversion of the
convertible term note and the exercise of warrants issued to
Laurus.  As of the filing date of this Annual Report, the Company has
yet to file that registration statement.  Consequently, the Company is
in breach of its registration obligations to Laurus.  As of June 30,
2008, the Company has not received any notice from Laurus regarding this
registration rights default and or the assessment of any penalties that might
have resulted therefrom.





On August
8, 2006, the Company issued $2,000,000 of convertible debentures to certain
investors. In conjunction with this issuance, the Company had agreed to file a
registration statement within forty-five (45) days, or by September 22, 2006,
covering the resale of the shares of common stock underlying the debentures and
warrants issued to the investors, and by October 15, 2006, to have such
registration statement declared effective.  The registration rights
agreement with the investors provides for partial liquidated damages in the case
that these registration requirements are not met.    From the
date of violation, the Company is obligated to pay liquidated damages of 2% per
month of the outstanding amount of the convertible debentures, up to a total of
24% of the initial investment, or $0.5 million.  As of the filing date
of this Annual Report, the Company has not yet filed a registration statement
regarding these securities.   Accordingly, through June 30, 2008, the
Company has incurred a liquidated damages obligation of $0.5 million, none of
which has been paid.    In addition, the Company is obligated to
pay 18% interest per annum on any damage amount not paid in full within 7
(seven) days.  Through June 30, 2008, the Company has incurred an
interest obligation of $0.1 million, none of which has been paid.  As
of the filing date of this Annual Report, the holders have not waived their
rights under this agreement.  Additionally, the Company’s breach of
its registration obligations constitutes a default under the agreement, which
enables the holders to declare the convertible debentures immediately due and
payable.  As of the filing date of this Annual Report, the Company has
not received any notice from the purchasers of the convertible debentures
regarding this registration rights default or any other default
notice.




19




As of the
filing date of this June 30, 2008 Annual Report on Form 10-K, we are in
non-compliance with the registration rights requirements of certain financings
set forth above covering in the aggregate,6,698,685 shares of our
common stock.





Listing
of common stock





Our
common stock is currently quoted on the Pink Sheets under the symbol
(“ABLE.PK”). The Company will apply for eligibility for trading on the OTC
Bulletin Board as soon as it qualifies for listing after it is in compliance
with its required SEC filings.  To continue such eligibility, we must
file our periodic reports with the SEC on a timely basis.  If we fail
to file such reports within 10 days of their due date, our stock will cease to
be eligible for quotation on the OTC Bulletin Board.  There can be no
assurance that our application for eligibility for quotation on the OTC Bulletin
Board will be accepted.  If we fail to have our common stock eligible
for quotation on the OTC Bulletin Board, the trading volume of our stock may be
adversely affected and stockholders may not able to sell any or all of their
shares at or above their basis in such stock, which would result in a loss for a
selling stockholder.





Timeliness
of future SEC filings





The
Company was unable to file this Annual Report on Form 10-K on a timely basis.
The late filing of this document may adversely affect our ability to raise
capital and erode investor confidence.  The Company will continue to
make every effort to keep all our SEC filings up-to-date.





Seasonal
factors




Our
revenues and income are derived from the home heating oil business and our auto
and travel plaza service business.  Our home heating oil business is
seasonal and is a material portion of our business. A substantial portion of the
home heating oil business is conducted during the fall and winter months.
Weather patterns during the winter months can have a material adverse impact on
our revenues. Although temperature levels for the heating season have been
relatively stable over time, variations can occur from time to time, and warmer
than normal winter weather will adversely affect the results of the Company's
fuel oil operations.  Our travel plaza services business is much less
susceptible to the seasonality issues experienced in our heating oil
business.





Approximately
60% to 65% of our revenues from our Oil Segment business are earned and received
from October through March. During the spring and summer months, revenues from
the sale of diesel and gasoline fuels increase, due to the increased use of
automobiles and construction apparatus.




Fuel
pricing and the effect on profitability




Disruption
of fuel supply and fuel pricing would adversely affect our profitability.
Increases in the pricing for fuel and home heating oil will also adversely
affect our profit margins associated with our businesses, since we may not be
able to pass on our proportional increases to our customers.




Other
factors which may have a significant effect on fuel prices include: natural
disasters, such as those which have devastated the Gulf Coast (areas that are
major producers, distributors or refiners of petroleum-based products); major
global conflicts, especially those involving the U.S. and/or oil producing
countries, strikes or political conflict in oil producing countries and the
stability of OPEC and its desire not to disrupt worldwide economies through poor
management of fuel supply and pricing.





In the
future, interruptions in the world fuel markets may cause shortages in, or total
curtailment of, fuel supplies. Moreover, a substantial portion of the oil
refining capacity in the United States is controlled by major oil companies.
These companies, for various reasons (e.g. for new standards imposed by EPA)
could in the future decide to limit the amount of fuel sold to independent
operators such as us. Any material decrease in the volume of fuel sold for any
extended period of time could have a material adverse effect on the results of
operations. Similarly, an extended period of instability in the price of fuel
could adversely affect our results.




20




Government
regulation




Federal,
state and local laws, particularly laws relating to the protection of the
environment and worker safety, can materially affect our operations. The
transportation and dispensing of fuel oil, diesel fuel, propane and gasoline is
subject to regulation by various federal, state and local agencies, including
the U.S. DOT. These regulatory authorities have broad powers and we are subject
to regulatory and legislative changes that can affect the economies of the
industry by requiring changes in operating practices or influencing demand for,
and the cost of providing, its services. Additionally, we are subject to random
DOT inspections. Any material violation of DOT rules or the Hazardous Materials
Transportation Act may result in citations and/or fines on us. In addition, we
depend on the supply of petroleum products from the oil and gas industry and,
therefore, we may be affected by changing taxes, price controls and other laws
and regulations relating to the oil and gas industry generally. We cannot
determine the extent to which future operations and earnings may be affected by
new legislation, new regulations or changes in existing
regulations.





The
technical requirements of these laws and regulations are becoming increasingly
expensive, complex and stringent. These laws may impose penalties or sanctions
for damages to natural resources or threats to public health and safety. Such
laws and regulations may also expose us to liability for the conduct or
conditions caused by others. Sanctions for noncompliance may include revocation
of permits, corrective action orders, administrative or civil penalties and
criminal prosecution. Certain environmental laws provide for joint and several
liabilities for remediation of spills and releases of hazardous substances. In
addition, companies may be subject to claims alleging personal injury or
property damages as a result of alleged exposure to hazardous substances, as
well as damage to natural resources.




Potential
environmental liability




Our fuel
distribution is subject to all of the operating hazards and risks that are
normally incidental to handling, storing, transporting and delivering fuel oils,
gasoline, diesel and propane, which are classified as hazardous materials. We
face potential liability for, among other things, fuel spills, gas leaks and
negligence in performing environmental clean-ups for our customers.
Specifically, we maintain fuel storage facilities on sites owned or leased by
us, and could incur significant liability to third parties or governmental
entities for damages, clean-up costs and/or penalties in the event of certain
discharges into the environment. Such liability can be extreme and could have a
material adverse effect on our financial condition or results of operations.
Although we believe that we are in compliance with existing laws and
regulations, there can be no assurance that substantial costs for compliance
will not be incurred in the future. Any substantial violations of these rules
and regulations could have an adverse affect upon our operations. Moreover, it
is possible that other developments, such as more stringent environmental laws,
regulations and enforcement policies thereunder, could result in additional,
presently unquantifiable, costs or liabilities to us.




No
assurance of adequate insurance protection




We
maintain insurance policies in such amounts and with coverage and deductibles as
our management believes are reasonable and prudent. There can be no assurance,
however, that such insurance will be adequate to protect us from liabilities and
expenses that may arise from claims for personal and property damage arising in
the ordinary course of business or that such level of insurance will be
maintained by us at adequate levels or will be available at economic prices.
Should the Company not be able to negotiate additional coverage at economical
rates, it may negatively affect the Company’s consolidated results of
operations.





Competition
from alternative energy sources (for the home heating oil division)




Our
retail home heating business competes for customers with suppliers of alternate
energy products, principally natural gas and electricity. Every year, a small
percentage of our oil customers convert to other home heating sources, primarily
natural gas. In addition, we may lose additional customers due to conversions
during periods in which the cost of its services exceeds the cost of alternative
energy sources.  If this trend continues and the Company is not able
to replace these lost customers through expansion or increased market share, it
could cause the Company to lose significant revenues. At this point, Able has
not suffered any significant loss as a result of conversion to these alternative
energy sources.




Concentration
of wholesale suppliers for heating oil





We
purchase our #2 heating oil fuel supplies on the spot market. We currently
satisfy our inventory requirements with ten different suppliers, the majority of
which have significant domestic fuel sources, and many of which have been
suppliers to us for over five years. Our current suppliers are Hess,
Conectiv Energy, Mirabito, Fossil Fuel, Burke Petroleum, Leighow Oil, BioHeat of
Colorado, Farm & Home, North Jersey Oil and Sunoco, Inc.  We
monitor the market each day and determine when to purchase our oil inventory and
from whom.




During
the year ended June 30, 2008, eleven suppliers (Sunoco, Hess, Sprague
Energy, Catamount Petroleum, Petrocom Energy, Petron Oil Corp., Gulf Oil
Corporation, Royal North Jersey Oil, Farm & Home Oil Company, Burke
Petroleum, and Valero Supply and Marketing) provided Able Oil and Able NY
with approximately 89 %of its heating oil
requirements.




21




TransMontaigne
Product Services, Inc. provided Able Melbourne with 100% of its diesel fuel
product requirements for the year ended June 30, 2008 and Fleetwing provided
Able Melbourne with all of its lubricant and related product requirements for
the year ended June 30, 2008.





Management
believes that if our supply of any of the foregoing products was interrupted, we
would be able to secure adequate supplies from other sources without a material
disruption in its operations. However, there can be no assurance that adequate
supplies of such products will be readily available in the future or that the
price the Company may be required to pay for such fuel or the credit terms for
such purchases will be acceptable to the Company.  Furthermore,
currently these suppliers extend us credit toward the purchase of our fuel
supplies. There can be no assurance that these suppliers will continue to offer
us acceptable credit terms.  Should the Company need to secure
alternative suppliers for these products, the pricing would be approximately the
same.





Absence
of written agreements




Approximately
86% of our home heating customers do not have written agreements with us and can
terminate services at any time, for any reason. Although we have never
experienced a significant loss of our customers, if we were to experience a
high rate of terminations, our business and financial condition could be
adversely affected.  While the Travel Plaza Segment has a number of
loyalty based supply and services agreements with commercial fleet customers,
none of these agreements require the commercial fleet operators to purchase
their fuel and services from the Travel Plaza Segment.




Risks
associated with expansion into new markets




A
significant element of our future growth strategy involves the expansion of our
business into new geographic and product markets. Expansion of our operations
depends, among other things, on the success of our marketing strategy in new
markets, successfully establishing and operating new locations, hiring and
retaining qualified management and other personnel and obtaining adequate
financing for vehicle and site purchases and working capital
purposes.





Dependence
on and relative inexperience of key personnel




Our
future success will depend, to a significant extent, on the efforts of current
key management personnel, including Gregory D. Frost, Chairman and Chief
Executive Officer, Richard A. Mitstifer, President, Daniel L. Johnston, Chief
Financial Officer, William Roger Roberts, Chief Operating Officer, Frank Nocito,
Executive Vice-President, Louis Aponte, President, Home Heating Oil Segment and
John L.Vrabel, Chief Operating Officer, Price Energy Unit.   On
May 24, 2007, Gregory D. Frost gave notice to the Board of Directors that he was
ending his leave of absence as Chief Executive Officer and Chairman of the Board
and was resuming his duties.  Messrs Mitstifer, Johnston, Roberts and
Nocito were appointed to their current positions by the Board of Directors on
September 24, 2007.  Mr. Aponte was appointed to his position on
October 22, 2008.  The loss of one or more of these key employees
could have a material adverse effect on our business. In addition, we believe
that our future success will depend, in large part, upon our continued
ability to attract and retain highly qualified management, technical
and sales personnel. There can be no assurance that we will be able to
attract and retain the qualified personnel necessary for our
business.





Competition





Our Oil
Segment business is highly competitive. In addition to competition from
alternative energy sources, we compete with distributors offering a broad range
of services and prices, from full service distributors similar to ours, to those
offering delivery of home heating fuel only. Competition with other companies in
the retail home heating industry is based primarily on customer service and
price. Longstanding customer relationships are typical in the home heating
industry. Many companies, including ours, deliver fuel to their customers based
upon weather conditions and historical consumption patterns without the
customers making an affirmative purchase decision each time fuel is needed. In
addition, most companies, including ours, provide equipment repair service on a
24 hour-a-day basis, which tends to build customer loyalty. We compete against
companies that may have greater financial resources than ours. As a result, we
may experience difficulty in acquiring new retail customers due to existing
relationships between potential customers and other retail home heating
distributors.  If the Oil Segment cannot effectively compete, we would
suffer losses of revenue and net income.




22


Weather





Weather
conditions can impact the demand for home heating fuel.  Demand for
home heating oil is primarily seasonal, utilized in the colder months of the
fall, winter, and early spring.  Demand is determined by weather
patterns and how cold the temperature gets.  Ordinarily, most demand
is determined by the measurement of heating degree days, a measurement of the
average temperature for the day that is below the mean temperature of 65 degrees
fahrenheit.  If weather patterns are such that temperatures are warmer
than normal, then less heating degree days will be used, and less of the
Company’s home heating products will be sold thereby negatively impacting our
revenues and net income (loss).





Heating
oil futures contracts





During
the period from July 28, 2006 to August 15, 2006, the Company’s PriceEnergy
subsidiary entered into futures contracts for #2 heating oil to hedge a portion
of its forecasted heating season requirements. The Company purchased 40
contracts through various suppliers for a total of 1,680,000 gallons of #2
heating oil at an average price of $2.20 per gallon. Due to warmer than average
temperatures through the heating season (lower than average degree days), as of
June 30, 2007, the Company experienced a substantial drop in fuel consumption
and price, resulting in a loss on these contracts.




Through
June 30, 2007, the Company’s PriceEnergy subsidiary deposited a total of
$923,017 in margin requirements with the broker.  Through June 30,
2007, the Company realized a loss, including fees, of $926,170 on 40 closed
contracts representing 1,680,000 gallons.  The Company entered into no
futures contracts in fiscal 2008.





Risks
Particular to the Travel Plaza Segment





We
are highly dependent on fuel sales which have low margins.





During
the year ended June 30, 2008, net revenues from fuel sales of the Travel Plaza
Segment accounted for approximately 65% of the Company’s total net revenues. The
volume of fuel sold by us and the profit margins associated with these sales are
affected by numerous factors outside of our control, including the condition of
the long-haul trucking industry, the supply and demand for these products and
the pricing policies of competitors. Fuel sales generate very low gross
margins.





The
U.S. truck stop industry is highly competitive and fragmented, and our
competitors may have greater resources or other competitive
advantages.





In
addition to competition from much larger, better financed travel plaza
operators, the Travel Plaza Segment competes with operators offering a broad
range of services and prices, from full service establishments similar to the
operations of the Travel Plaza Segment, to deep discount operators offering only
fuel.  Competition with other companies in the travel plaza industry
is based primarily on customer service, location, hours of operation and price.
Longstanding customer relationships are typical in industry.  In
addition, most travel Plaza operators, including the Travel Plaza Segment,
provide service on a 24 hour-a-day basis, which tends to build customer
loyalty.  As a result, the Travel Plaza Segment may experience
difficulty in acquiring new customers due to existing relationships between
potential customers and their current providers, competitive pricing and new or
upgraded travel plaza operators.





The
Travel Plaza Segment is highly dependent on the financial condition of the
trucking industry.





Our
business is dependent upon the trucking industry in general and upon long-haul
trucks in particular. In turn, the trucking industry is dependent on economic
factors, such as the level of domestic economic activity and interest rates and
operating factors such as fuel prices and fuel taxes, over which we have no
control and which could contribute to a decline in truck travel. The long-haul
trucking business is also a mature industry that has historically been
susceptible to recessionary downturns. Available data indicate that diesel
consumption by the trucking industry has grown more slowly than trucking
ton-miles, as technological improvements in truck engines have increased their
fuel efficiency. In addition, many small trucking companies have filed for
bankruptcy protection in recent years. A decline in operations by the long-haul
trucking industry would adversely affect us.





Our
profitability can be significantly impacted by cyclical factors beyond our
control such as decreases in manufacturing output.





The
volume of truck shipments is in part dependent on changes in manufacturing
output. Sustained decreases in manufacturing production can significantly reduce
truck traffic, which in turn reduces fuel purchases and visits to our travel
plazas, and negatively impacts our results of operations.




23




A
domestic terrorist incident affecting the trucking industry could adversely
affect our business.





A
domestic terrorist incident, particularly an incident involving a truck, could
produce adverse effects on our business in several ways, including:





•
            
            a
      reduction in the volume of truck traffic for more than a brief
      period;





•
            
            the
      bankruptcy of certain trucking companies;
and





•
            
            the
      imposition of additional regulations affecting truck traffic, increasing
      the expenses of truck operations and businesses that service trucks or
      provide overnight facilities for trucks and truck drivers, such as our
      business. For example, additional fences or other security for parked
      trucks might be required.





The
occurrence of any of these effects could have a material negative impact on our
results of operations.





We
are subject to environmental laws and regulations and the cost of compliance
with these requirements could negatively impact the results of our
operations.





A
significant portion of our business consists of storing and dispensing petroleum
products, activities that are subject to increasingly stringent regulation by
both the federal and state governments. Moreover, governmental authorities can
impose significant fines and penalties on us for any alleged noncompliance with
environmental requirements. In addition, under certain environmental laws,
private parties can bring lawsuits against us for any property damage or
personal injury that allegedly is caused by our operations. We may incur
increased expenditures if additional requirements are imposed by federal and
state governments, or we fail to comply with environmental requirements and are
fined or penalized, or if we must defend or settle lawsuits that might be
brought by private parties.





In
addition, under various environmental laws, a current or previous owner or
operator of real property may be liable for the costs of removal or remediation
of hazardous or toxic substances (including petroleum and petroleum products)
on, under, in, or migrating from such property. Certain laws impose liability
whether or not the owner or operator knew of, or was responsible for, the
presence of such hazardous or toxic substances. Moreover, under certain
environmental laws, persons who arrange, or are deemed to have arranged, for the
disposal or treatment of hazardous or toxic substances may also be liable for
the costs of removal or remediation of such substances at the disposal or
treatment site, regardless of whether such site is owned or operated by such
person and regardless of whether the original disposal or treatment activity
accorded with applicable requirements. As a result of our business and the
quantity of petroleum products we handle, there can be no assurance that
hazardous substance contamination does not exist or that material liability will
not be imposed in the future for the remediation of such
contamination.





A
disruption in the supply of fuel could adversely affect our
profitability.





We would
be adversely affected in the event of a disruption in our supply of fuel. In
addition, sharp increases in fuel prices at truck stop plazas have historically
tended to lead to temporary declines in fuel margins. Fuel prices have risen
sharply in the recent past and may continue to rise.  Factors which
have had significant effects on fuel prices include: the interaction of several
factors including low inventories, high demand caused by a spike in the cost of
natural gas, major global conflicts, especially those involving the U.S. and/or
oil producing countries, strikes or political conflict in oil producing
countries, intervention by OPEC in the form of restricted output and changes in
output by domestic oil refineries.





In the
future, interruptions in world fuel markets may cause shortages in, or total
curtailment of, fuel supplies. Moreover, a substantial portion of the oil
refining capacity in the United States is controlled by major oil companies.
These companies could in the future decide to limit the amount of fuel sold to
independent operators like us. Although our current suppliers provide fuel to
us, a significant portion of our fuel needs continues to be supplied from
third-parties contracted by them. In addition, any new standards that the EPA
may impose on refiners that would necessitate changes in the refining process
could limit the volume of petroleum products available from refiners in the
future. A material decrease in the volume of fuel sold for an extended time
period would have a material adverse effect on our results of operations.
Similarly, an extended period of instability in the price of fuel could
adversely affect our results.




24




In
addition, our patronage by customers desiring to purchase fuel accounts for a
significant portion of customer traffic and has a direct impact on the revenues
and profitability of our other operations, including our restaurant and non-fuel
operations. Accordingly, any significant reductions in fuel supplies or other
reductions in fuel volume would materially adversely affect our
results.





Weather
or seasonal issues have an insignificant impact on the Company’s Travel Plaza
Segment.  While leisure travel has a tendency to moderate somewhat in
the winter months in the geographic areas in which we operate, revenue related
to the leisure traveler is relatively insignificant compared to fuel and
services related revenue generated by our professional driver
customers.





Item
1B. Unresolved Staff Comments





Not
applicable.





Item 2. Properties





The
Company's administrative headquarters are located in a 9,800 square foot
facility in Rockaway, New Jersey. This facility accommodates the Company's
administrative, marketing and sales personnel. The lease expired on October 31,
2007 and carries an annual rent of $122,287, which includes common area charges.
We continue to occupy the space on a month-to-month basis.  The
Company owns property located at 344 Route 46 in Rockaway, New Jersey. This
facility accommodates the Company's fuel terminal, including fuel storage tanks,
truck yard space and dispatch operations. The Company purchased the property in
August 1999, through a newly formed wholly-owned subsidiary, Able Energy
Terminal, LLC, at a purchase price of $1,150,000. The Company also owns a
building, totaling approximately 1,450 square feet, consisting of a wood frame
facility located at 38 Diller Avenue, Newton, New Jersey, that will serve as a
supply depot, storage area and administrative offices and service facility when
damage that occurred on March 14, 2003 in connection with a fire is
repaired.  Please refer to Note 21 - Subsequent Events found in the
notes to the Consolidated Financial Statements in Item 8 of this Annual Report
for disclosure relating to the lease of the Newton facility.





On July
1, 2006, Able NY moved into a brand new terminal located at 10 Industrial Park
in Warrensburg, NY.  This 118,556 square foot property was purchased
by the Company in 2003, and accommodates Able NY fuel terminal, including liquid
fuel storage tanks, truck yard space, dispatch operations and a small office
staff.





Able
subleases an office located at 1140 Sixth Avenue in New York City. The lease
expires on April 29, 2009 and carries an annual rent increasing from $196,467 to
$208,432 over the term of the lease. This 4,569 square foot space is used as our
executive offices.





Effective June 1, 2007, Plazas executed
ten leases with Properties for ten of Plazas travel plaza
locations.  The leases expire on September 30, 2009 and provide for an
initial aggregate annual lease payment of $6.5 million.  The Plaza
leases automatically renew, upon the mutual consent of Plazas and Properties,
for consecutive one-year terms so that the total term of each lease shall be
for a period of ten years.


The ten
properties and their location by state are:





Belmont-NY


Carney-NJ


Doswell-VA


Clarks
Ferry-PA


Frystown-PA


Gables of
Carlisle-PA


Gables of
Frystown-PA


Gables of
Harrisburg-PA


Milton-PA


Strattanville-PA
(Inactive)




25




See, Item
1- Business – Travel Plaza Operations, for a more detailed description of these
plazas.





In
addition, Plazas leases its Breezewood, PA travel plaza facility from
unaffiliated third parties.  The primary facility lease was executed
on December 31, 2005, expires on December 31, 2010 and was assumed by Plazas
upon the completion of the business combination with Properties on May 30,
2007.  The annual rent is $420,000.  Plazas also lease an
adjacent parking area under a lease that expires February 28,
2009.  The annual rent for the parking area is $98,000.





Typically,
these travel plazas include fuel islands, restaurants, retail and convenience
stores, maintenance services, game rooms, personal services, lodging (in certain
locations) and other amenities for both the professional and leisure
traveler.





In
connection with the business combination with Properties, Able acquired a ten
year option to acquire any of the travel plaza real estate owned by Properties,
providing that the Company assume all existing debt obligations related to the
applicable properties or refinance the existing debt with new loans with the
Company as to mortgagor.  The option has been valued at $5.0 million
and is exercisable as long as Plazas’ leases relating to the applicable real
estate remain in effect.  Plazas’ leases automatically renew, upon the
mutual consent of Plazas and Properties, for consecutive one-year terms so that
the total term of each lease shall be for a period of ten years.





Item
3. Legal Proceedings





Except as
described hereafter, as of June 30, 2008, the Company was not a party to any
pending material legal proceeding.  To the knowledge of management, no
director, executive officer or affiliate of the Company or owner of record or
beneficially of more than 5% of the Company’s common stock is a party adverse to
the Company or has a material interest adverse to the Company in any
proceeding.





Following
an explosion and fire that occurred at the Company's Facility in Newton, NJ on
March 14, 2003, and through the subsequent clean up efforts, the Company has
cooperated fully with all local, state and federal agencies in their
investigations into the cause of this accident.  A lawsuit (known as
Hicks vs. Able Energy,
Inc.) has been filed against the Company by residents who allegedly
suffered property damages as a result of the March 14, 2003 explosion and fire.
The Company's insurance carrier is defending the Company as it relates to
compensatory damages. The Company has retained separate legal counsel to defend
the Company against the punitive damage claim. On June 13, 2005, the Court
granted a motion certifying a plaintiff class action which is defined as "All
Persons and Entities that on and after March 14, 2003, residing within a 1,000
yard radius of Able Oil Company's fuel depot facility and were damaged as a
result of the March 14, 2003 explosion". The Company sought and received Court
permission to serve interrogatories to all class members and in November 2007
answers to interrogatories were received by less than 125 families and less than
15 businesses. The Company successfully moved to exclude any and all persons and
entities from the class that did not previously provide answers to
interrogatories.  The class certification is limited to economic loss
and specifically excludes claims for personal injury from the Class
Certification. The Company believes that the Class Claims for compensatory
damages is within the available limits of its insurance coverage. On September
13, 2006, the plaintiff’s counsel made a settlement demand of $10,000,000, which
the Company believes to be excessive and the methodology upon which it is based
to be fundamentally flawed. On May 7, 2008, this matter entered mediation. As of
the date of this Report, mediation has not been successful but the Company
remains open to reasonable settlement discussions with the plaintiffs. The
Company intends to vigorously defend the claim.





Relating
to the March 14, 2003 explosion and fire, a total of 227 claims have been filed
against the Company for property damages and 224 claims have been settled by the
Company's insurance carrier. In addition to the Hicks action, six property
owners, who were unable to reach satisfactory settlements with the Company's
insurance carrier, filed lawsuits for alleged property damages suffered as a
result of the March 14, 2003 explosion and fire. Subsequently, four of the
lawsuits were settled. Two of the lawsuits are pending.  The Company's
insurance carrier is defending the Company as it relates to the Hicks action and
the remaining two property damage claims. The Company's counsel is defending
punitive damage claims. The Company believes that compensatory damage claims are
within the available limits of insurance and reserves for losses have been
established, as deemed appropriate, by the insurance carrier. The Company
believes the remaining three unsettled lawsuits will not have a material adverse
effect on the Company's consolidated financial condition or
operations.




26




On
September 7, 2006, the Company received a Formal Order of Private Investigation
from the SEC pursuant to which the Company, certain of its officers and a
director were served with subpoenas requesting certain documents and
information. The Formal Order authorizes an investigation of possible violations
of the anti-fraud provisions of the federal securities laws with respect to the
offer, purchase and sale of the Company's securities and the Company's
disclosures or failures to disclose material information. The Company believes
that it did not violate any securities laws and intends to cooperate fully with
and assist the SEC in its inquiry. The scope, focus and subject matter of the
SEC investigation may change from time to time and the Company may be unaware of
matters under consideration by the SEC. The Company has produced and will, if
required, continue to produce responsive documents and intends to continue
cooperating with the SEC in connection with the investigation.  On May
13, 2008, the Company received correspondence from the SEC requesting the
Company respond, in writing, to eleven questions proffered by the SEC
staff.  The Company provided its responses to the eleven questions in
its response to the SEC, dated May 21, 2008.  The responsive
correspondence was signed by the Company’s outside SEC counsel, Buchanan
Ingersoll & Rooney, PC, after the correspondence was reviewed by the
Company’s senior management, as well as the Company’s outside financial
consultants.





On July
29 and 30, 2008, the Company’s CEO, Mr. Frost, and the Company’s Executive
Vice-President, Business Development, Mr. Nocito, were deposed by the
SEC.  The Company has been advised by its SEC counsel, who also
attended the depositions, that the primary focus of the investigation is for the
Company to complete its outstanding, delinquent filings in order to obtain
filing compliance.





On June
26, 2007, the Company and its affiliate, All American Properties, Inc. (together
with the Company the “Claimants”), filed a Demand for Arbitration and Statement
of Claim in the Denver, Colorado office of the American Arbitration Association
against Manns Haggerskjold of North America, Ltd. (“Manns”), Scott Smith and
Shannon Coe (collectively the “Respondents”), Arbitration Case No. 77 148 Y
00236 07 MAV. The Statement of Claim filed seeks to recover fees of $1.2 million
paid to Manns to obtain financing for the Company and All American. The
Claimants commenced the Arbitration proceeding based upon the Respondents breach
of the September 14, 2006 Commitment letter from Manns to All American that
required Manns to loan All American $150 million. The Statement of Claim sets
forth claims for breach of contract, fraud and misrepresentation and lender
liability. On July 23, 2007, Respondents filed their answer to the Statement of
Claim substantially denying the allegations asserted therein and interposing
counterclaims setting forth claims against the Company for breach of the
Non-Circumvention Clause, breach of the Exclusivity Clause and unpaid expenses.
Respondents also assert counterclaims for fraudulent misrepresentation and
unjust enrichment. On Respondents’ counterclaim for breach of the
Non-Circumvention Clause, Respondents claim damages of $6,402,500. On their
counterclaim for breach of the Exclusivity Clause, Respondents claim damages of
$3,693,750, plus an unspecified amount related to fees on loans exceeding
$2,000,000 closed by All American or the Company over the next five years.
Respondents do not specify damages relative to their other
counterclaims.





On August
7, 2007, the Claimants filed their reply to counterclaims denying all of
Respondents material allegations therein. Respondents’ counterclaims were based
on the false statement that the Claimants had, in fact, received the financing
agreed to be provided by Manns from a third party.   The
Respondents subsequently withdrew their counterclaims.





The
parties have selected an Arbitrator and are presently engaged in
discovery.  Document production has been completed and depositions of
the parties have commenced.  It is anticipated that these depositions
will be concluded by the end of November, 2008.  The hearing is
currently scheduled to commence before the Arbitrator on December 8,
2008.





On
October 1, 2007, the Company and its Chief Executive Officer (“CEO”) filed an
action in New York state court against Marcum & Kliegman, LLP (the Company’s
former auditors) and several of its partners for numerous claims, including
breach of contract, gross negligence and defamation.  The Company and
its CEO are seeking compensatory damages in the amount of at least $1 million
and punitive damages of at least $20 million. The claims asserted by the Company
and its CEO arise out of Marcum & Kliegman’s conduct with respect to the
preparation and filing of the Company’s SEC Reports.  On November 26,
2007, Marcum & Kliegman and its partners filed a motion to dismiss the
complaint on the ground that it fails to state a claim for relief as a matter of
law.  On May 5, 2008, the Court issued a written decision and order
sustaining the Company’s claims against Marcum & Kliegman for breach of
contract and defamation, but dismissed the Company’s claims for negligence,
gross negligence, breach of fiduciary duty and breach of covenant of good faith
and fair dealing against Marcum & Kliegman and the defamation claim against
the individual defendants.  Both the Company and Marcum & Kliegman
have filed appeals from the decision and order.  Discovery proceedings
have commenced and the Company intends to vigorously prosecute this
action.




27




On
January 7, 2008, the Company, its Chief Executive Officer, Gregory D. Frost, and
its Vice-President of Business Development, Frank Nocito, were served with a
summons and complaint in a purported class action complaint filed in the United
States District Court, District of New Jersey. This action, which seeks class
certification, was brought by shareholders of CCI Group, Inc. (“CCIG”). The
complaint relates to a Share Exchange Agreement (the “Share Exchange
Agreement”), dated July 7, 2006, between Properties and CCIG, pursuant to which
seventy percent (70%) of the outstanding and issued shares of CCIG were
exchanged for 618,557 shares of the Company’s common stock which were owned by
Properties of which 250,378 shares were to be distributed to the shareholders of
CCIG and the balance of the shares were to be used to pay debts of
CCIG.  Neither the Company nor Messrs. Frost or Nocito were parties to
the Share Exchange Agreement. Properties remain the largest shareholder of the
Company. The Share Exchange Agreement was previously disclosed by the Company in
its Current Report on Form 8-K filed with the SEC on July 7, 2006 as part of a
disclosure of a loan by the Company to Properties.





Each of
the Company and Messrs. Frost and Nocito believes it/he has defenses against the
alleged claims and intends to vigorously defend itself/himself against this
action and have filed a motion to dismiss the compliant.  The motion
has been fully briefed and submitted to the Court.  As of the date of
this Report, no decision has been issued with respect to the
motion.




See, Note
21 – Subsequent Events – Litigation, found in the Notes to the Consolidated
Financial Statements in Item 8 of this Annual Report for disclosure relating to
other legal proceedings in which the Company is currently involved which may
have a material adverse effect on the consolidated operations or financial
results of the Company. On occasion, the Company may become a party to
litigation incidental to its business. There can be no assurance that any legal
proceedings will not have a material adverse affect on the Company.





Item
4. Submission of Matters to a Vote of Security Holders





None




28


PART II





Item
5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities





(a)
Market Price and Dividend Information





Since
October 13, 2006, the Company's Common Stock has been quoted on the Pink Sheets
under the symbol "ABLE".  From 1999 until October 13, 2006, the
Company’s common stock traded on the Nasdaq Capital Market (formerly the Nasdaq
Small Cap Market) under the symbol “ABLE”.  The following table sets
forth the high and low bid prices of the Common Stock on a quarterly basis for
the 2007 and 2008 fiscal years as reported by Nasdaq or quoted through the Pink
Sheets:




Fiscal Year Ending June 30,
      2008
            
            High
            
            
            LowFirst
    Quarter
            
            $
            2.25
            
            
            $
            1.35Second
    Quarter
            
            
            1.50
            
            
            
            0.60Third
    Quarter
            
            
            0.94
            
            
            
            0.60Fourth
    Quarter
            
            
            0.70
            
            
            
            0.34Fiscal Year Ended June 30,
      2007
            
            High
            
            
            LowFirst
    Quarter
            
            $
            7.70
            
            
            $
            4.43Second
    Quarter
            
            
            4.55
            
            
            
            1.80Third
    Quarter
            
            
            2.80
            
            
            
            1.82Fourth
    Quarter
            
            
            2.30
            
            
            
            1.35





(b) As of
June 30, 2008, the Company’s common stock was held beneficially by approximately
2,600 persons.





(c)
Dividends





We have
never paid a cash dividend on our common stock.  It is the current
policy of our Board of Directors to retain any earnings to finance the
operations and expansion of our business.  The payment of dividends in
the future will depend upon our earnings, financial condition and capital needs
and on other factors deemed pertinent by the Board of Directors.





(d)
Recent Sales of Unregistered Securities





On
January 11, 2008, the Company executed a consulting agreement with Hammond
Associates, LLC to provide consulting services in connection with satisfying the
Company’s SEC reporting requirements.  On April 30, 2008, the Company
issued 14,442 restricted shares of its common stock, $0.001 par value, at $0.56
per share as partial consideration for services provided by the
consultant.  The Company recorded consulting expense of $8,088 related
to this share issuance in the year ended June 30, 2008.  On April 16,
2008, the Company also issued Hammond Associates, LLC a five-year warrant to
purchase 25,000 shares at $0.56 per share as partial consideration for services
provided by the consultant.  Using the Black Scholes valuation model,
the Company valued the Company’s common stock underlying the warrant at $0.31
per share and recorded additional consulting expense of $7,750 relating to the
issuance of the warrant. One sixth of the hourly fee paid to the consultant is
payable by the Company in shares of the Company’s common stock, based on the per
share market value of the Company’s common stock on the trading day preceding
issuance of the shares.  Shares are issued from time-to-time in
satisfaction of the Company’s obligation to the consultant.





No other
unregistered equity securities were sold or issued by the Company during Fiscal
2008.





(e)
Purchases of Equity Securities by the Company and Affiliated
Purchasers





Neither
the Company nor any of its affiliates repurchased any of the Company’s equity
securities during Fiscal 2008.




Comparison
of Cumulative Total Returns





The
following table shows a comparison of cumulative total returns on the common
stock of the Company from June 30, 2003 through June 30, 2008 with the
cumulative total return on the NASDAQ Stock Market-U.S. and the cumulative total
return on a group of NASDAQ Fuel Oils Companies (SIC Code 5983) (the “Peer
Group”).





29









30




Item 6. Selected Financial Data





The
following selected financial data presented for Able and its Subsidiaries on a
consolidated basis should be read in conjunction with the Consolidated Financial
Statements, including the related notes, and "Item 7 - Management's Discussion and
Analysis of Financial Condition and Results of Operation".





For
      the Year Ended June 30,2008
            
            
            2007
            
            
            2006
            
            
            2005
            
            
            2004Results
      of Operation Data-Continuing Operations
            
            
            
            
            
            
            
            
            
            
            (1)
            
            
            (1)(2)Sales
            
            $
            276,440,588
            
            
            $
            93,641,548
            
            
            $
            75,093,104
            
            
            $
            61,872,623
            
            
            $
            42,847,123Gross
      Profit
            
            
            17,582,654
            
            
            
            8,538,014
            
            
            
            7,467,895
            
            
            
            6,150,470
            
            
            
            5,579,654Operating
      Loss
            
            
            (9,749,034
            )
            
            
            (4,007,513
            )
            
            
            (2,857,627
            )
            
            
            (1,928,309
            )
            
            
            (2,310,863
            )Net
      Loss
            
            
            (12,913,233
            )
            
            
            (6,632,303
            )
            
            
            (6,241,559
            )
            
            
            (2,180,091
            )
            
            
            (1,732,959
            )Depreciation
      andAmortization
            
            
            1,888,906
            
            
            
            740,203
            
            
            
            755,700
            
            
            
            1,225,197
            
            
            
            1,194,958Interest
      Expense
            
            
            2,213,955
            
            
            
            949,016
            
            
            
            642,517
            
            
            
            449,776
            
            
            
            576,578Basic
      and DilutedLoss
      Per Share -Continuing
      Operations
            
            
            (0.86
            )
            
            
            (1.60
            )
            
            
            (2.23
            )
            
            
            (1.04
            )
            
            
            (0.86
            )Basic
      and DilutedWeighted
      AverageNumber
      of SharesOutstanding
            
            
            14,953,440
            
            
            
            4,133,090
            
            
            
            2,800,476
            
            
            
            2,094,629
            
            
            
            2,013,250Consolidated
      BalanceSheet
      DataCash
            
            $
            3,025,577
            
            
            $
            3,034,183
            
            
            $
            2,144,729
            
            
            $
            1,754,318
            
            
            $
            1,309,848Current
      Assets
            
            
            11,514,927
            
            
            
            23,143,640
            
            
            
            7,164,977
            
            
            
            6,100,464
            
            
            
            5,531,423Current
      Liabilities
            
            
            24,423,978
            
            
            
            26,768,567
            
            
            
            7,597,294
            
            
            
            6,853,089
            
            
            
            5,500,095Total
      Assets
            
            
            34,742,998
            
            
            
            48,162,096
            
            
            
            13,090,868
            
            
            
            12,433,858
            
            
            
            12,229,536Long-Term
      Liabilities
            
            
            3,937,230
            
            
            
            4,362,542
            
            
            
            3,821,488
            
            
            
            3,966,041
            
            
            
            3,724,692Total
      Stockholders’Equity
            
            
            6,381,790
            
            
            
            17,030,987
            
            
            
            1,672,086
            
            
            
            1,614,728
            
            
            
            3,095,927




Notes


(1)
            The
      consolidated balance sheet data as of June 30, 2005 and 2004 and the
      consolidated statement of operations data for the years ended June 30,
      2005 and 2004 have been derived from
      the consolidated financial statements for such
  periods.


(2)
            The
      consolidated results of operations data for the years ended June 30, 2004
      have been adjusted to reflect the discontinued operations of Able Propane,
      LLC.








Item 7. Management’s Discussion
and Analysis of Financial Condition and Results of
Operation





The
following discussion should be read in conjunction with our Consolidated
Financial Statements, and Notes thereto, contained elsewhere in this Annual
Report.




31




Overview





Able was
incorporated in Delaware in 1997. Able Oil, a wholly-owned subsidiary of Able,
was established in 1989 and sells both residential and commercial heating oil,
diesel fuel and complete HVAC service to it heating oil customers. Able NY, a
wholly-owned subsidiary of Able, sells residential and commercial heating oil,
propane, diesel fuel and kerosene to customers in and around the Warrensburg, NY
area. Price Energy, Inc., a majority owned subsidiary of Able, was established
in 1999 and has developed a platform that has extended the Company’s ability to
sell and deliver liquid fuels and related energy products over the Internet. The
Company’s newest subsidiary, All American Plazas, Inc., was formed to operate
eleven travel plazas acquired in connection with the Company’s business
combination with All American Properties, Inc. (formerly known as All American
Plazas, Inc.) which was consummated on May 30, 2007.  These plazas
serve the professional and leisure traveler in the mid-Atlantic and northeast
regions of the United States of America.





Management’s
Discussion and Analysis of Financial Condition and Results of Operation contains
forward-looking statements, which are based upon current expectations and
involve a number of risks and uncertainties.  Investors are hereby
cautioned that these statements may be affected by the important factors, among
others, set forth below, and consequently, actual operations and results may
differ materially from those expressed in these forward-looking statements. The
important factors include:





·
            Commodity
      Supply


·
            Commodity
      Pricing


·
            Customers
      Converting to Natural Gas


·
            Alternative
      Energy Sources


·
            Winter
      Temperature Variations (Loss of Heating Degree
  Days)


·
            Availability
      of Financing


·
            Legislative
      Changes


·
            The
      Availability (Or Lack of) Acquisition
Candidates


·
            The
      Success of Our Risk Management
Activities


·
            The
      Effects of Competition


·
            Changes
      in Environmental Law





We
undertake no obligation to update or revise any such forward-looking
statements.





Business
Strategy





Our
business plan calls for maximization of sales throughout our existing Oil
Segment and Travel Plaza Segment market areas by means of aggressive market
penetration to recapture lost business as well as to attract new customers who
have moved into or travel through our market areas.  In addition, our
external strategy is to acquire related heating oil and travel plaza businesses,
which strengthen and expand our current service areas along with moving into
planned new areas.  In this way, we can realize new residential and
commercial business and take advantage of expected population growth in new
market regions.





We also
are in the process of becoming more vertically integrated through
acquisition.  In addition to acquiring businesses in the core #2
heating oil portion of our business, we are also developing relationships with
potential acquisitions in the area of diesel fuel distribution, truck stop
facilities, convenience store/gasoline fueling stations and alternative
fuels.  Also, the Company is building its delivery coverage area in
the northeast by expanding its dealer network and volume capabilities through
Internet sales via our PriceEnergy.com platform.





Critical
Accounting Policies and Estimates





Our
significant accounting policies are described in Note 3 of the consolidated
financial statements included in this Annual Report on Form 10-K for the fiscal
year ended June 30, 2008.  The consolidated financial statements are
prepared in accordance with United States generally accepted accounting
principles which require 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 those
estimates.





We
consider the following policies to be the most critical in understanding the
judgments involved in preparing the consolidated financial statements and the
uncertainties that could impact our results of consolidated operations,
financial condition and cash flows.




32


Revenue
Recognition, Unearned Revenue and Customer Pre-Purchase Payments





Sales of
travel plaza services, fuel and heating equipment are recognized at the time of
delivery to the customer, and sales of equipment are recognized at the time of
installation. Revenue from repairs and maintenance service is recognized upon
completion of the service. Payments received from customers for heating
equipment service contracts are deferred and amortized into income over the term
of the respective service contracts, on a straight-line basis, which generally
do not exceed one year.  Payments received from customers for the
pre-purchase of fuel are recorded as a current liability until the fuel is
delivered to the customer, at which time the payments are recognized as revenue
by the Company.





Depreciation,
Amortization and Impairment of Long-Lived Assets





We
calculate our depreciation and amortization based on estimated useful lives and
salvage values of our assets. When assets are put into service, we make
estimates with respect to useful lives that we believe are reasonable. However,
subsequent events could cause us to change our estimates, thus impacting the
future calculation of depreciation and amortization.




Additionally,
we assess our long-lived assets for possible impairment whenever events or
changes in circumstances indicate that the carrying value of the assets may not
be recoverable. Such indicators include changes in our business plans, a change
in the extent or manner in which a long-lived asset is being used or in its
physical condition, or a current expectation that, more likely than not, a
long-lived asset that will be sold or otherwise disposed of significantly before
the end of its previously estimated useful life. If the carrying value of an
asset exceeds the future undiscounted cash flows expected from the asset, an
impairment charge would be recorded for the excess of the carrying value of the
asset over its fair value. Determination as to whether and how much an asset is
impaired would necessarily involve numerous management estimates. Any impairment
reviews and calculations would be based on assumptions that are consistent with
our business plans and long-term investment decisions.





Allowance
for Doubtful Accounts





We
routinely review our receivable balances to identify past due amounts and
analyze the reasons such amounts have not been collected. In many instances,
such uncollected amounts involve billing delays and discrepancies or disputes as
to the appropriate price or volumes of oil delivered, received or exchanged. We
also attempt to monitor changes in the creditworthiness of our customers as a
result of developments related to each customer, the industry as a whole and the
general economy. Based on these analyses, we have established an allowance for
doubtful accounts that we consider to be adequate, however, there is no
assurance that actual amounts will not vary significantly from estimated
amounts.




Income
Taxes





As part
of the process of preparing consolidated financial statements, the Company is
required to estimate income taxes in each of the jurisdictions in which it
operates. Significant judgment is required in determining the income tax expense
provision. The Company recognizes deferred tax assets and liabilities based on
differences between the financial reporting and tax bases of assets and
liabilities using the enacted tax rates and laws that are expected to be in
effect when the differences are expected to be recovered. The Company assesses
the likelihood of our deferred tax assets being recovered from future taxable
income. The Company then provides a valuation allowance for deferred tax assets
when the Company does not consider realization of such assets to be more likely
than not. The Company considers future taxable income and ongoing prudent and
feasible tax planning strategies in assessing the valuation allowance. Any
decrease in the valuation allowance could have a material impact on net income
in the year in which such determination is made.





Recent
Accounting Pronouncements





In June
2005, the Financial Accounting Standards Board (FASB) published Statement of
Financial Accounting Standards No. 154, “Accounting Changes and Error
Corrections” (“SFAS 154”). SFAS 154 establishes new standards on accounting for
changes in accounting principles. Pursuant to the new rules, all such changes
must be accounted for by retrospective application to the financial statements
of prior periods unless it is impracticable to do so. SFAS 154 completely
replaces Accounting Principles Bulletin No. 20 and SFAS 3, though it carries
forward the guidance in those pronouncements with respect to accounting for
changes in estimates, changes in the reporting entity and the correction of
errors. The requirements in SFAS 154 are effective for accounting changes made
in fiscal years beginning after December 15, 2005. The Company applied
these requirements to accounting changes made after the implementation
date.





EITF
Issue No. 05-4 “The Effect of a Liquidated Damages Clause on a Freestanding
Financial Instrument Subject to EITF Issue No. 00-19, Accounting for Derivative
Financial Instruments Indexed to, and Potentially Settled in, a Company's Own
Stock” (“EITF No. 05-4”) addresses financial instruments, such as stock purchase
warrants, which are accounted for under EITF 00-19 that may be issued at the
same time and in contemplation of a registration rights agreement that includes
a liquidated damages clause. The consensus of EITF No. 05-4 has not been
finalized. In July and August 2006, the Company entered into two private
placement agreements for convertible debentures and a note payable, a
registration rights agreement and issued warrants in connection with the private
placement (See Note 12). Based on the interpretive guidance in EITF Issue No.
05-4, view C, since the registration rights agreement includes provisions for
uncapped liquidated damages, the Company determined that the registration rights
is a derivative liability.  The Company has measured this liability in
accordance with SFAS No. 5.




33




In
February 2006, the FASB issued SFAS No. 155 “Accounting for Certain Hybrid
Financial Instruments”, which eliminates the exemption from applying SFAS 133 to
interests in securitized financial assets so that similar instruments are
accounted for similarly regardless of the form of the instruments. SFAS 155 also
allows the election of fair value measurement at acquisition, at issuance or
when a previously recognized financial instrument is subject to a remeasurement
event. Adoption is effective for all financial instruments acquired or issued
after the beginning of the first fiscal year that begins after September 15,
2006. Early adoption is permitted. The adoption of SFAS 155 has not had a
material effect on the Company's consolidated financial position, results of
operations or cash flows.





In March
2006, the FASB issued SFAS No. 156, “Accounting for Servicing of Financial
Assets”, which amended SFAS No. 140, “Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities”, with respect to the
accounting for separately recognized servicing assets and servicing
liabilities.  SFAS 156 permits an entity to choose either the
amortization method or the fair value measurement method for each class of
separately recognized servicing assets or servicing
liabilities.  Adoption is effective after the beginning of the first
fiscal year that begins after September 15, 2006.  The application of
this statement has not had a material impact on the Company’s consolidated
financial statements.





In July
2006, the FASB issued FASB Interpretation No. 48, "Accounting for Uncertainty in
Income Taxes - an interpretation of FASB Statement No. 109" ("FIN 48"), which
clarifies the accounting for uncertainty in tax positions. This interpretation
requires that the Company recognize in its consolidated financial statements,
the impact of a tax position, if that position is more likely than not of being
sustained on audit, based on the technical merits of the position. The
provisions of FIN 48 are effective as of July 1, 2007, with the cumulative
effect of the change in accounting principle recorded as an adjustment to
opening retained earnings. The application of this statement has not had a
material impact on the Company’s consolidated financial statements.





In
September 2006, the FASB issued SFAS No.157, "Fair Value Measurements", which
defines fair value, establishes a framework for measuring fair value in United
States generally accepted accounting principles and expands disclosures about
fair value measurements. This statement does not require any new fair value
measurements, but provides guidance on how to measure fair value by providing a
fair value hierarchy used to classify the source of the
information.  SFAS No. 157 is effective for fiscal years beginning
after November 15, 2007, and all interim periods within those fiscal
years.  In February 2008, the FASB released FASB Staff Position (FSP
FAS 157-2 – Effective Date of FASB Statement No. 157) which delays the effective
date of SFAS No. 157 for all non-financial assets and nonfinancial liabilities,
except those that are recognized or disclosed at fair value in the financial
statements on a recurring basis (at least annually), to fiscal years beginning
after November 15, 2008 and interim periods within those fiscal
years.  The Company is currently evaluating the impact of adoption of
this statement on its financial and nonfinancial assets and
liabilities.





In
September 2006, the FASB issued SFAS No. 158, “Employers Accounting for Defined
Pension and Other Postretirement Plans-an amendment of FASB No.’s 87, 88, 106
and 132(R).”  SFAS 158 requires an employer and sponsors of one or
more single employer defined plans to recognize the funded status of a benefit
plan; recognize as a component of other comprehensive income, net of tax, the
gain or losses and prior service costs or credits that may arise during the
period; measure defined benefit plan assets and obligations as of the employer’s
fiscal year; and enhance footnote disclosure.  For fiscal years ending
after December 15, 2006, employers with equity securities that trade on a public
market are required to initially recognize the funded status of a defined
benefit postretirement plan and to provide the enhanced footnote
disclosures.  For fiscal years ending after December 15, 2008,
employers are required to measure plan assets and benefit
obligations.  Management of the Company is currently evaluating the
impact of adopting this pronouncement on the consolidated financial
statements.





In
December 2006, the FASB issued FASB Staff Position ("FSP") EITF 00-19-2
"Accounting for Registration Payment Arrangements" ("FSP EITF 00-19-2") which
specifies that the contingent obligation to make future payments or otherwise
transfer consideration under a registration payment arrangement should be
separately recognized and measured in accordance with SFAS No. 5, "Accounting
for Contingencies." Adoption of FSP EITF 00-19-02 was required for fiscal years
beginning after December 15, 2006, and has not had a material impact on the
Company's consolidated financial position, results of operations or cash
flows.




34




In
February 2007, the FASB issued SFAS No. 159 "The Fair Value Option for Financial
Assets and Financial Liabilities-Including an amendment of FASB Statement No.
115", which permits entities to choose to measure many financial instruments and
certain other items at fair value. The fair value option established by this
Statement permits all entities to choose to measure eligible items at fair value
at specified election dates. A business entity shall report unrealized gains and
losses on items for which the fair value option has been elected in earnings at
each subsequent reporting date. Adoption is required for fiscal years beginning
after November 15, 2007. Early adoption is permitted as of the beginning of a
fiscal year that begins on or before November 15, 2007, provided the entity also
elects to apply the provisions of SFAS Statement No. 157, Fair Value
Measurements.The
application of this statement has not had a material impact on the Company’s
consolidated financial statements.





In
December 2007, the FASB issued SFAS No. 160 “Noncontrolling Interests in
Consolidated Financial Statements–an amendment of ARB No. 51.”  SFAS
160 establishes accounting and reporting standards pertaining to ownership
interests in subsidiaries held by parties other than the parent, the amount of
net income attributable to the parent and to the noncontrolling interest,
changes in a parent’s ownership interest, and the valuation of any retained
noncontrolling equity investment when a subsidiary is
deconsolidated.  This statement also establishes disclosure
requirements that clearly identify and distinguish between the interests of the
parent and the interests of the noncontrolling owners.  SFAS 160 is
effective for fiscal years beginning on or after December 15,
2008.  The Company is in the process of evaluating the effect that the
adoption of SFAS 160 will have on its consolidated results of operations,
financial position and cash flows.





In
December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business
Combinations” (SFAS 141R).  SFAS 141R establishes principles and
requirements for how an acquirer recognizes and measures in its financial
statements the identifiable assets acquired, the liabilities assumed, any
noncontrolling interest in the acquiree and the goodwill
acquired.  SFAS 141R also establishes disclosure requirements to
enable the evaluation of the nature and financial effects of the business
combination.  SFAS 141R is effective for financial statements issued
for fiscal years beginning after December 15, 2008.   The Company
is currently evaluating the potential impact of adoption of SFAS 141R on its
consolidated financial statements.





In March
2008, the FASB issued SFAS No. 161 “Disclosures about Derivative Instruments and
Hedging Activities”.  The new standard is intended to improve
financial reporting about derivative instruments and hedging activities by
requiring enhanced disclosures to enable investors to better understand their
effects on an entity’s financial statements issued for fiscal years and interim
periods beginning after November 15, 2008, with early adoption
encouraged.  The Company is currently evaluating the impact of
adopting SFAS No. 161 on its consolidated financial statements.




In May
2008, the FASB issued SFAS No. 162 “The Hierarchy of Generally Accepted
Accounting Principles”.  The new standard identifies the sources of
accounting principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy).  SFAS No. 162 will become
effective 60 days following the SEC’s approval of the Public Company Accounting
Oversight Board amendments to AU Section 411, The Meaning of Present Fairly
in Conformity With Generally Accepted Accounting Principles.  Adoption
of SFAS No. 162, upon its effectiveness, is not expected to have a material
impact on the Company's consolidated financial position, results of operations
or cash flows.




Results
of Operations - Fiscal 2008 Compared to Fiscal 2007





During
the year ended June 30, 2008, the Company’s total revenues from its Oil and
Travel Plaza Segments were $276.4 million.  The $182.8 million
increase in revenue over the same period last year is predominately the result
of the business combination with Properties on May 30, 2007.





Oil
Segment





Net sales
were $74.6 million for the year ended June 30, 2008 compared to $74.1 million in
the same period last year, an increase of $0.5 million, or 0.7%. This increase
was primarily due to an increase in #2 Heating Oil sales of 5.41%, partially
offset by a decrease in other fuel sales of 9.6%.





Gross
profit decreased approximately $0.7 million to $6.8 million and gross profit
margin percent for the year ended June 30, 2008 decreased to 9.0% from 10.0%
last year. The drop in gross profit was primarily attributable to a decrease in
#2 heating oil gross profit margin percent of approximately 4.9% points due
primarily to out of product situations with some of our vendors and having to
purchase product from more expensive suppliers during times of extreme
product price volatility.  This was mitigated to some extent by our
gross margin on all other fuel and service products.





Selling,
general and administrative expense for the year ended June 30, 2008 decreased by
$2.7 million to $7.4 million, or 26.7%, compared to the same period in the prior
year. This is predominately related to a decrease in the Oil Segment audit and
legal fees and reductions in staff.




35


Total
other expenses increased to a net expense of $2.9 million in the year ended June
30, 2008 from $2.6 million last year.





As a
result of the above noted performance for the year ended June 30, 2008, net loss
improved approximately $1.6 million or 27.2%, to a net loss of $4.4
million.





Travel Plaza
Segment





Net sales
for the year ended June 30, 2008 were $201.9 million, reflecting our first full
year of consolidated reporting of the Travel Plaza Segment, acquired May 30,
2007.





Gross
profit for the year ended June 30, 2008 was $10.8 million.





Selling,
general and administrative expense for the year ended June 30, 2008 was
approximately $17.9 million.





Total
other income for the year ended June 30, 2008 was approximately
$5,000.





Net loss
of the Travel Plaza Segment was $8.5 million for the year ended June 30,
2008.





No
comparable information for the Travel Plaza Segment exists for the prior fiscal
period since the business combination with Properties was not closed until May
30, 2007 and therefore, the Company was engaged in the travel plaza business for
only one month during that period.





Depreciation
and Amortization





Depreciation
and amortization expense increased from $0.7 million in fiscal 2007 to $1.9
million in fiscal 2008.  The increase was primarily due to $0.5
million in first year amortization of the Company’s option to purchase real
estate and $0.6 million relating to the first full year consolidation of
operating results for the Travel Plaza Segment.





Liquidity and
Capital Resources





We
incurred a net loss of $12.9 million and used cash in operations of $3.6 million
for the twelve month period ended June 30, 2008. Our principal sources of
working capital have been the proceeds from borrowing against the Company’s
receivables and credit card sales. During the three month period ended June 30,
2008, the Company issued $0.8 million in notes payable.  During the
twelve month period ended June 30, 2008, the Company secured $7.2 million from
the proceeds of notes payable. Other than for the day–to-day operations of
the Company, nothing was expended for advances to related parties and $6.5
million was expended for repayment of notes payable during the twelve month
period ended June 30, 2008.





We had a
working capital deficiency of $12.9 million at June 30, 2008 compared to a
working capital deficiency of $3.6 million at June 30, 2007. The working capital
decrease of $9.3 million was primarily due to decreases in accounts receivable,
inventories and advances to related parties, partially offset by a decrease in
accounts payable.





These
factors raise substantial doubt about the Company's ability to continue as a
going concern. These condensed consolidated financial statements do not include
any adjustments relating to the recoverability of the recorded assets or the
classification of the liabilities that may be necessary should the Company be
unable to continue as a going concern.  The Company will need some
combination of the collection of notes receivable, new financing, restructuring
of existing financing, improved receivable collections and/or improved operating
results in order to maintain adequate liquidity.





The
Company is pursuing other lines of business, which include expansion of its
current commercial business into other products and services such as bio-diesel,
solar energy and other energy related home services. The Company is also
evaluating all of its business segments for cost reductions, consolidation of
facilities and efficiency improvements. There can be no assurance that we will
be successful in our efforts to enhance our liquidity situation.





On May
13, 2005, the Company entered into a $1,750,000 line-of-credit agreement (the
“Agreement”) with Entrepreneur Growth Capital, LLC (“EGC”). The loan is secured
by certain eligible accounts receivable, inventory and certain other assets as
defined in the agreement. The line bears interest at Citibank's prime rate, plus
4% per annum (9.0% at June 30, 2008 and 12.25% at June 30, 2007) not to exceed
24%, with a minimum interest of $9,000 per month. The line also requires an
annual facility fee and monthly collateral management fees equal to 2% and
0.025%, respectively. In addition, deposits are not credited to our account
until four business days after receipt by EGC. On December 27, 2007 and February
11, 2008 the Company received an Over Advance each in the amount of $250,000 on
its line of credit with EGC. Terms on the over advance were thirty days. On
December 28, 2007 and February 25, 2008, the Company increased an existing
credit line by executing a Fuel Purchase Loan (“FPL”) agreement with
EGC.  The increase, in the amount of $0.5 million, is a further
extension of credit under an existing May 13, 2005 agreement




36




between
the Company and EGC (the “Loan Agreement”) (See Note 10).  In addition
to the general terms of the Loan Agreement, under the repayment terms of the
FPL, EGC will reduce the loan amount outstanding by applying specific amounts
from the Company’s availability under the Loan Agreement.  These
amounts start at $2,500 per business day, commencing March 1, 2008, gradually
increasing to $10,000 per business day on June 1, 2008 and thereafter until the
FPL is paid in full.  In further consideration for making the FPL,
commencing February 22, 2008, EGC shall be entitled to receive a revenue share
of four cents ($0.04) per gallon of fuel purchased with the FPL funds, subject
to a $5,000 per week minimum during the first seven weeks of the
program.  The balance due as of June 30, 2008 and June 30, 2007 was
$979,818 and $481,602, respectively, with an available balance as of June 30,
2008 of $770,182.  The Agreement renews annually unless terminated by
either party, as provided for in the Agreement.




On
January 8, 2007, Plazas entered into an Account Purchase Agreement with Crown
Financial (“Crown”) whereby Crown advanced $1,444,775 to Plazas in exchange for
certain existing accounts receivables and taking ownership of new accounts
originated by Plazas.  Repayment of the loan is to be made from the
direct payments to Crown from the accounts it purchased from Plazas and a fee
equal to 2.5% of the outstanding advance for the preceding period payable on the
15th
and 30th day of
each month.  The Crown loan is secured by the mortgages on the real
property and improvements thereon owned by Properties known as the Strattanville
and Frystown Gables truck stop plazas and a personal guarantee by Frank Nocito,
an Executive Vice President of the Company and through a family trust the
largest shareholder of the Company.  Subsequent to the May 2007
closing of the business combination between the Company and Properties, on July
1, 2007 the Account Purchase Agreement between Plazas and Crown Financial was
amended and modified from “Eligible Accounts having a 60 day aging” to a “90 day
aging that are not reasonably deemed to be doubtful for collections” and the fee
of 2.5% payable on the 15th and
30th
day of each month has been modified to 1.375%. The Company has assumed this
obligation based on the business combination; however, Properties has agreed to
continue to secure this financing with the aforementioned mortgages on real
property owned by Properties. The balance due on the Crown note at June 30, 2008
and June 30, 2007 was $817,367 and $1,324,775, respectively.





On March
20, 2007, the Oil Segment entered into a credit card receivable advance
agreement with Credit Cash, LLC ("Credit Cash") whereby Credit Cash agreed to
loan the Company $1.2 million. The loan is secured by the Company's existing and
future credit card collections. Terms of the loan call for a repayment of
$1,284,000, which includes a one-time finance charge of $84,000, over a
seven-month period. This will be accomplished through Credit Cash withholding
18% of Credit Card collections of Able Oil Company and 10% of Credit Card
collections of PriceEnergy.com, Inc. over the seven-month period, which began on
March 21, 2007. There are certain provisions in the agreement, which allows
Credit Cash to increase the withholding, if the amount withheld by Credit Cash
over the seven-month period is not sufficient to satisfy the required repayment
of $1,284,000.  On July 18, 2007, August 3, 2007, November 9, 2007,
January 18, 2008, February 4, 2008, February 14, 2008, and April 11, 2008, the
Company, in accordance with its agreement with Credit Cash, refinanced the loan
in the amounts of $250,000, $300,000, $1,100,000, $500,000, $250,000, $500,000
and $800,000, respectively (see Note 10). The outstanding Credit Cash loan as of
June 30, 2008 and 2007 was $292,618 and 493,521, respectively.  Please
refer to Note 21 – Subsequent Events, found in the Notes to the Consolidated
Financial Statements in Item 8 of this Annual Report for disclosure relating to
additional transactions with Credit Cash subsequent to June 30, 2008, that
helped improve or affected the Company’s liquidity.





Prior to
the business combination between Properties and the Company, Properties entered
into a loan agreement with Credit Cash, which was an advance against credit card
receivables at the truck stop plazas then operated by Properties.  As
a result of the business combination, this obligation was assumed by the
Company’s newly formed, wholly-owned subsidiary, Plazas as it became the
operator of the truck stop plazas. Credit Cash, while acknowledging the business
combination, has continued to obligate both Properties and Plazas in their loan
documents as obligors of the loan.





On July
16, 2007, Credit Cash agreed to extend further credit of $400,000 secured by the
credit card receivables at the truck stops operated by Plazas.  This
July 16, 2007 extension of credit agreement was in addition to and supplemented
all previous agreements with Credit Cash. Terms of the original loan and
extensions called for repayment of $1,010,933 plus accrued interest which will
be repaid through Credit Cash withholding 15% of credit card collections from
the operations of the truck stop plazas until the loan balance is paid in full.
The interest rate is prime plus 3.75% (8.75% at June 30, 2008). There are
certain provisions in the agreement, which allows the Lender to increase the
withholding, if the amount it is withholding is not sufficient to satisfy the
loan in a timely manner. However, on November 2, 2007 and again on January 18,
2008, Credit Cash again agreed to extend an additional credit in the amount of
$1,100,000 and $600,000, respectively. Terms of the agreement are the same as
the prior July 16, 2007 financing. The outstanding balance of the loan as of
June 30, 2008 and 2007 was $328,474 and $1,160,235, respectively, plus accrued
interest.  Please refer to Note 21 – Subsequent Events, found in the
Notes to the Consolidated Financial Statements in Item 8 of this Annual Report
for disclosure relating to additional transactions with Credit Cash subsequent
to June 30, 2008, that helped improve or affected the Company’s
liquidity.




37




On
October 17, 2007, the Company entered into a loan agreement with S&S NY
Holdings, Inc. (“S&S”) for $500,000 to purchase #2 heating fuel. The term of
the agreement is for 90 days with an option to refinance at the end of the 90
day period for an additional 90 days. The repayment of the principal amount will
be $.10 cents per gallon of fuel sold to the Company’s customers excluding
pre-purchase gallons. An additional $.075 per gallon will be paid as interest.
The agreement also provides that in each 30 day period the interest amount can
be no less than $37,500.00.  The amount outstanding on this note at
June 30, 2008 was $362,820.  As of February 15, 2008 the Company had
repaid $137,180 and exercised its right to refinance the amount until March 31,
2008.  The Company has provided for repayment of this loan in exchange
for granting S&S a 49% interest in Able Energy NY, Inc., a wholly owned
subsidiary of the Company, and a 90% interest in the Company’s Easton and
Horsham, PA operations (“Able PA”).





On
December 20, 2007, the Company entered in to a second loan agreement with
S&S for $500,000 to purchase #2 heating fuel.  The term of the
agreement is through March 31, 2008.  The repayment of principle is
not due until the maturity date.  An additional $0.075 per gallon will
be paid as interest. The agreement also provides that in each 30-day period the
interest amount can be no less than $37,500.  On July 22, 2008, the
Company entered into an agreement with S&S which provided for repayment of
the loans from S&S in exchange for granting S&S a 49% interest in Able
Energy NY, Inc. (“Able NY”), a wholly owned subsidiary of the Company, and a 90%
interest in Able PA. This agreement was subsequently amended on October 31, 2008
granting the Company the right to repurchase S&S’s interests in Able NY and
Able PA (“Able PA”). See “S&S Settlement Agreement” and “Amendment to
S&S Settlement Agreement” in Note 21 – Subsequent Events, in the
Consolidated Financial Statements in Item 8 of this Annual Report.





As of
June 30, 2008, the Company had a cash balance of $3.0 million and $0.8 million
of available borrowings through its credit line facility, potentially offset by
$1.5 million in obligations for funds received in advance under the pre-purchase
fuel program. In order to meet our liquidity requirements, the Company continues
to explore financing opportunities available to it.





The
business combination between Properties and the Company pursuant to which the
Company would acquire the businesses, which would constitute the Company’s
Travel Plazas Segment, was approved by a special supermajority (as required
under Delaware corporate law) of the Company’s unrelated-party shareholders at a
special meeting of shareholders held on August 29, 2006. Separately, on August
30, 2006, the Company received a Formal Order of Private Investigation from the
SEC pursuant to which the Company and certain of its officers and a director
were served with subpoenas requesting certain documents and
information.  The Formal Order authorizes an investigation of possible
violations of the anti-fraud provisions of the federal securities laws with
respect to the offer, purchase and sale of our securities and our disclosures or
failures to disclose material information in the Company’s SEC required filings.
Upon the Company notifying its then auditors, Marcum & Kliegman, LLP
(“M&K”) of the Company’s receipt of the Formal Order and subpoenas, M&K,
as a condition to its continued engagement as the Company’s auditors, required
that the Company delay the completion of the business combination until after
M&K completed the audit for year ended June 30, 2006. The Company acquiesced
to that condition. By letter dated September 27, 2006, M&K notified the
Company that it would implement new and additional auditing procedures in light
of the Formal Order. The audit for the year ended June 30, 2006 was not
completed until April 12, 2007. M&K billed approximately 3,500 hours for the
audit at a cost in excess of $800,000. In addition, the Company retained outside
consultants, Financial Consulting Strategies, LLC (FCS”) to assist with the
audit at a cost of more than $175,000. FCS was recommended by M&K to assist
the Company since M&K stated it has worked with FCS on audit matters for
other clients of M&K.  The fees incurred by the Company in
connection with the audit for the year ended June 30, 2006 significantly
exceeded the Company’s initial expectations as a result of the events described
in this paragraph.





The
result of M&K’s condition that the completion of the business combination be
delayed until the 2006 audit was completed together with the substantial delay
in completing the 2006 audit caused the Company substantial loss of opportunity,
substantial expense and resulted in the Company not being current with its SEC
filing requirements.





On May
30, 2007, the Company  finally completed its previously announced
business combination between Properties and the Company whereby the Company, in
exchange for an aggregate of 11,666,667 shares of the Company’s restricted
common stock, purchased the operating businesses of eleven truck stop plazas
owned and operated by Properties. 10 million shares were issued directly to
Properties and the remaining 1,666,667 shares were issued in the name of
Properties in escrow pending the decision by the Company’s Board of Directors
relating to the assumption of certain Properties secured debentures. The
acquisition included all assets comprising eleven truck plazas other than the
underlying real estate and the buildings thereon.





Thereafter,
as the Company commenced the integration of the two entities, the Company had
immediate short-term cash issues resulting from the extraordinary additional
legal and accounting expenses relating to the 2006 audit and the SEC
investigation.  Those expenses coupled with the Company’s inability to
raise debt or equity capital as a result of it being out of SEC filing
compliance and the lack of current financial statements left the Company in a
precarious position. By the fall of 2007, All American Plazas, Inc. (“Plazas”),
the Company’s wholly-owned subsidiary formed to operate the travel plaza
businesses acquired in the business combination, was utilizing its current cash
to meet not only its needs, but also those of the Company. The Company was also
experiencing a substantial decline in its business in the period from September
through December 2007 due, in large part, to an unusually warm fall and early
winter season. During this period a substantial portion of the Company’s cash
requirements were paid by Plazas from operations of the Travel Plazas
Segment.  Also during this period, the Travel Plazas Segment started
to experience a reduction of truck traffic at its facilities. By
the




38




spring of
2008 the Travel Plazas Segment had experienced a reduction of approximately 35%
to 40% in its diesel fuel sales. This reduction was the result of a weakening
economy and the substantial escalation of the cost of diesel fuel. In addition,
with the substantial increase of the cost of the Travel Plazas Segment’s main
product, Plazas also experienced an increase in the cost of its credit card
processing fees. The fee charged Plazas for processing credit cards at its
travel plazas is based upon a multiple of the purchase price. The unprecedented
increase in the cost of motor fuel through the summer of 2008 and the concurrent
increase in credit card processing fees required the Company to enter into
short-term loans with Credit Cash, LLC by financing its credit card receivables
to permit the Company to meet its expenses. The costs and rates incurred on
these loans were extremely expensive. As a result, the Company’s financial
condition rapidly deteriorated.





The
Company entered into a fuel supply agreement on May 8, 2008 with Atlantis
Petroleum, LLC, which has assisted Plazas in meeting the diesel fuel
requirements for the Travel Plaza Segments facilities in Pennsylvania by
providing a ten day credit facility for the payment of these fuel
purchases.





By
September, 2008 the cost of fuel began to decline which has helped the Company
with certain of its cash requirements; however, the domestic and global economy
has continued to experience a turbulent decline creating great uncertainty in
the United States markets and economy. The Company is taking actions to meet
this challenge, however, there can be no assurances that the Company will be
able to adequately meet the uncertainties of the current economic
down-turn.





In order
to conserve its capital resources as well as to provide an incentive for the
Company’s employees and other service vendors, the Company will continue to
issue, from time to time, common stock and stock options to compensate employees
and non-employees for services rendered. The Company is also focusing on
its home heating-oil business by expanding distribution programs and developing
new customer relationships to increase demand for its products. In addition, the
Company is pursuing other lines of business, which include expansion of its
current commercial business into other products and services such as bio-diesel,
solar energy and other energy related home services.





Please
refer to Item 1A. Risk
Factors, Registration rights agreements for additional disclosure of
prior year transactions that may eventually have a negative impact the Company’s
future liquidity.





Please
also refer to Notes 10, 11 and 12 of the consolidated financial statements
included in this Annual Report on Form 10-K for the fiscal year ended June 30,
2008 for additional disclosures relating to the Company’s potential future
payment obligations for notes payable, capital leases and convertible
debentures, respectively.





Subsequent
to June 30, 2008, the Company executed numerous financing agreements, sold
certain assets and engaged in other activities to enhance its
liquidity.  Please refer to Note 21 - Subsequent Events, found in the
Notes to the Consolidated Financial Statements in Item 8 of this Annual Report,
for detailed disclosure of these activities, subsequent to June 30, 2008, that
helped to improve the Company’s liquidity





The
Company must also bring current each of its SEC filings as part of a plan to
raise additional capital. In order to achieve filing compliance, the Company, in
addition to the filing of this Form 10-K for the year ended June 30, 2008, must
also complete and timely file its Report on Form 10-Q for the quarter ended
September 30, 2008.





There can
be no assurance that the financing or the cost saving measures as identified
above will be satisfactory in addressing the short-term liquidity needs of the
Company. In the event that these plans cannot be effectively realized, there can
be no assurance that the Company will be able to continue as a going concern.





Off-Balance
Sheet Arrangements





The
Company does not have any off-balance sheet financing arrangements.




39


Contractual
Obligations





The
following schedule summarizes our contractual obligations as of June 30, 2008 in
the periods indicated:





Less
      Than
              
              
              
              
              
              
              
              
              More
      thenContractual
      Obligation
              
              Total
              
              
              1
      Year
              
              
              1-3
      Years
              
              
              3-5
      years
              
              
              5
      yearsLong
      term debt
              
              $
              7,492,942
              
              
              $
              4,123,602
              
              
              $
              467,576
              
              
              $
              211,923
              
              
              $
              2,689,842Capital
      lease obligations
              
              
              687,694
              
              
              
              366,804
              
              
              
              259,186
              
              
              
              61,704
              
              
              
              -Operating
      leases
              
              
              9,193,883
              
              
              
              7,183,883
              
              
              
              2,010,000
              
              
              
              -
              
              
              
              -Other
      long term obligations
              
              
              214,517
              
              
              
              141,600
              
              
              
              -
              
              
              
              -
              
              
              
              -Total
      contractual obligations
              
              $
              17,589,035
              
              
              $
              11,815,888
              
              
              $
              2,736,762
              
              
              $
              273,627
              
              
              $
              2,689,842




Excluded
from the table above are estimated interest payments on long-term debt and
capital lease obligations of approximately $534,000, $463,000, $350,000 and
$1,684,000 for the periods less than 1 year, 1-3 years, 3-5 years and more than
5 years, respectively.   In addition, excluded from above are
unconditional purchase obligations of approximately $0.3 million that the
Company entered into subsequent to June 30, 2008.





Additional
Factors That May Affect Future Results





Purchase
of Horsham





On
December 13, 2006, the Company purchased the assets of its Horsham franchise
from Able Oil Montgomery, Inc., a non- related party, for $764,175. Able Oil
Montgomery is a full service retail fuel oil and service company located in
Horsham, Pennsylvania. Pursuant to the agreement, the Company paid cash at
closing of $128,000, issued a 5 year note payable bearing interest at a rate of
7% per annum in the amount of $345,615 and forgave an amount of $290,560 due
from the seller to the Company. Separately, the seller paid to the Company
$237,359 for monies collected in advance by Able Oil Montgomery from its
customers.





Seasonality





The
Company’s Oil Segment operations are subject to seasonal fluctuations, with a
majority of the Oil Segment’s business occurring in the late fall and winter
months. Approximately 60% to 65% of the Oil Segment’s revenues are earned and
received from October through March; most of such revenues are derived from the
sale of home heating products, primarily #2 home heating
oil.  However, the seasonality of the Oil Segment’s business is
offset, in part, by an increase in revenues from the sale of HVAC products and
services, diesel and gasoline fuels during the spring and summer months due to
the increased use of automobiles and construction apparatus.





From May
through September, Able Oil can experience considerable reduction of retail
heating oil sales. Similarly, Able NY’s propane operations can experience up to
an 80% decrease in heating related propane sales during the months of April to
September, which is offset somewhat by increased sales of propane gas used for
pool heating, heating of domestic hot water in homes and fuel for outdoor
cooking equipment.





Seasonal
issues have an insignificant impact on the Company’s Travel Plaza
Segment.  While leisure travel has a tendency to moderate somewhat in
the winter months in the geographic areas in which we operate, revenue related
to the leisure traveler is relatively insignificant compared to fuel and
services related revenue generated by our professional driving
customers.





Future
Operating Results





Future
operating results, which reflect management’s current expectations, may be
impacted by a number of factors that could cause actual results to differ
materially from those stated herein.  These factors include worldwide
economic and political conditions, terrorist activities, industry specific
factors and governmental agencies.




40


Item
7A. Quantitative and Qualitative Disclosures about Market Risk





Not
applicable.





Item
8. Financial Statements and Supplementary Data





Our
consolidated financial statements and the related notes thereto called for by
this item appear under the caption “Consolidated Financial Statements” beginning
on page F-1 attached hereto of this Annual Report on Form 10-K.





Item
9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.





On August
13, 2007, the Company dismissed Marcum & Kliegman, LLP as its independent
registered public accounting firm. The report of Marcum & Kliegman, LLP on
the Company's financial statements for the fiscal year ended June 30, 2006 (“FY
2006”) was modified as to uncertainty regarding (1) the Company’s ability to
continue as a going concern as a result of, among other factors, a working
capital deficiency as of June 30, 2006 and possible failure to meet its short
and long-term liquidity needs, and (2) the impact on the Company’s financial
statements as a result of a pending investigation by the SEC of possible federal
securities law violations with respect to the offer, purchase and sale of the
Company’s securities and the Company’s disclosures or failures to disclose
material information.





The
Company’s Audit Committee unanimously recommended and approved the decision to
change independent registered public accounting firms.





In
connection with the audit of the Company’s financial statements for FY 2006, and
through August 13, 2007, there have been no disagreements with Marcum &
Kliegman, LLP on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure, which disagreements, if not
resolved to the satisfaction of Marcum & Kliegman, LLP would have caused it
to make reference to the subject matter of such disagreements in connection with
its audit report. There were no reportable events as defined in Item
304(a)(1)(v) of Regulation S-K. On August 24, 2007, Marcum & Kliegman, LLP
sent a responsive letter to the Current Report on Form 8-K dated August 13,
2007, filed by the Company, which discussed the Company’s termination of Marcum
and Kliegman, LLP as its auditors. This responsive letter claimed that there
were two reportable events.  The Company filed an amended Form 8-K
Report acknowledging one reportable event that Marcum and Kliegman, LLP had
advised the Company of material weaknesses in the Company’s internal controls
over financial reporting. The Company added disclosure in the Amended 8-K to
reflect this reportable event. This reportable event occurred in conjunction
with Marcum & Kliegman’s audit of the consolidated financial statements for
the year ended June 30, 2006 and not, as stated in the Auditor’s Letter, in
conjunction with Marcum & Kliegman’s “subsequent reviews of the Company’s
condensed consolidated financial statements for the quarterly periods ended
September 30, 2006 and December 31, 2006.” In June 2007, when Marcum &
Kliegman began its review of the Company quarterly financial statements for the
periods ended September 30, 2006 and December 31, 2006, the Company had already
disclosed the material weakness in its internal controls over financial
reporting in the Company’s Annual Report on Form 10-K for the year ended June
30, 2006 (filed on April 12, 2007). Further, no such advice of these material
weaknesses over internal controls was discussed, in writing or orally, with the
Company by representatives of Marcum & Kliegman during the review of such
quarterly financial statements.





Subsequent
to their dismissal on August 13, 2007, on October 1, 2007, the Company and its
Chief Executive Officer (“CEO”) filed an action in New York state court against
Marcum & Kliegman, LLP. See, Item 3, “Litigation” of this
Report.





The
Company engaged Lazar Levine & Felix, LLP (“LLF”) as its new independent
registered public accounting firm as of September 21, 2007. Prior to its
engagement, LLF had been serving as independent auditors for Properties, an
affiliate and the largest stockholder of the Company.





Item
9A. Controls and Procedures





Evaluation
of Disclosure Controls and Procedures




An
evaluation of the Company's disclosure controls and procedures (as defined in
Section13a-15(e) of the Securities Exchange Act of 1934 (the "Act")) was carried
out under the supervision and with the participation of the Company's Chief
Executive Officer and Chief Financial Officer and several other members of the
Company's senior management at June 30, 2008. Based on this evaluation, and as
noted below, the Company's Chief Executive Officer and Chief Financial Officer
concluded that as of June 30, 2008, the Company's disclosure controls and
procedures were not effective, for the reasons discussed below, at a reasonable
level of assurance, in ensuring that the information required to be disclosed by
the Company in the Reports it files or submits under the Act is (i) accumulated
and communicated to the Company's management (including the Chief Executive
Officer and Chief Financial Officer) in a timely manner, and (ii) recorded,
processed, summarized and reported within the time periods specified in the
SEC's rules and forms.




41




The
Company had previously identified a weakness during the preparation of
its June 30, 2006 Form 10-K. The weakness related to the Company’s loss of
its then Chief Financial Officer and the appointment of an Acting Chief
Financial Officer. As a result of the SEC’s Formal Order of Private
Investigation and the subpoenas issued in connection therewith and the change of
the Company’s auditors, the Company became delinquent in filing its SEC Reports
During the preparation of the June 30, 2006 Form 10-K, the Company retained
independent consultants with experience in public company disclosure
requirements to assist the Chief Executive Officer and the then acting Chief
Financial Officer in their respective duties during the review, preparation and
disclosures required in SEC rules and regulations.  A new Chief
Financial Officer was appointed as of September 24, 2007 and the Company
continues to engage independent consultants with experience in public company
disclosure requirements to assist such officers in their respective duties
during the review, preparation and disclosures required in SEC rules and
regulations. The Company believes that its appointment of its new Chief
Financial Officer, along with the continued retention of independent
consultants, will result in its disclosure controls and procedures being
sufficiently effective to insure that the Company will become compliant with its
SEC reporting requirements.





Management’s
Report on Internal Control over Financial Reporting




Management
of the Company is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in the Securities
Exchange Act of 1934 Rule 13a-15(f). Internal control over financial reporting
refers to the process designed by, or under the supervision of, the Company’s
Chief Executive Officer and Chief Financial Officer, and effected by the
Company’s Board of Directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles, and includes those policies and
procedures that:





·
            Pertain
      to the maintenance of records that, in reasonable detail, accurately and
      fairly reflect the transactions and dispositions of the Company’s
      assets;





·
            Provide
      reasonable assurance that transactions are recorded as necessary to permit
      preparation of financial statements in accordance with generally accepted
      accounting principles, and that receipts and expenditures are being made
      only in accordance with authorizations of the Company’s management and
      directors; and





·
            Provide
      reasonable assurance regarding prevention or timely detection of
      unauthorized acquisition, use or disposition of the Company’s assets that
      could have a material effect on the Company’s financial
      statements.





Under the
supervision and with the participation of the Company's management, including
the Chief Executive Officer and the Chief Financial Officer, the Company's
management conducted an evaluation of the effectiveness of the Company's
internal control over financial reporting as of June 30, 2008 as required by the
Securities Exchange Act of 1934 Rule 13a-15(c). In makinig this assessment, the
Company's management used the criteria set forth in the framework in "Internal
Control - Integrated Framework" issued by the Committee of Sponsoring
organizations of the Treadway Commission ("COSO"). Based on the evaluation
conducted under the framework in "Internal Control - Integrated Framework"
issued by COSO the Company's management concluded that the Company's internal
control over financial reporting was not effective as of June 30, 2008. The
previously identified weakness pertaining to timely filing of the Company's
annual and interim periodic SEC filings has not been remediated as of June 30,
2008. Remediation of the weakness will not occur until the Company is in
compliance with all of its periodic filings and has the ability to file future
filings on a timely basis.




42




This
Annual Report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the SEC that permit the
Company to provide only management’s report in this Annual Report on Form
10-K.





Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness into future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.





Changes in Internal
Controls





There
have been no changes to the Company’s system of internal control over financial
reporting during the year ended June 30, 2008 that has materially affected, or
is reasonably likely to materially affect, the Company’s system of controls over
financial reporting.




As part
of a continuing effort to improve the Company’s business processes management is
evaluating its internal controls and may update certain controls to accommodate
any modifications to its business processes or accounting
procedures.




Item
9B. Other Information


Credit
Card Receivable Financing





On April
11, 2008 the Oil Segment of the Company and its subsidiary, PriceEnergy.com,
refinanced their loans with Credit Cash, in the aggregate amount of $800,000
with similar terms to that of the original financing..





Fuel
Supply





On May 8,
2008, Plazas entered into a Fuel Supply Agreement (“FSA”) with Atlantis
Petroleum, LLC (“Atlantis”).  The FSA provides that for a term of
three years, Atlantis will be the sole and exclusive diesel fuel supplier to
eight (8) of the travel plazas operated by Plazas located in Pennsylvania. The
price per gallon of the diesel fuel supplied by Atlantis provides Plazas with a
favorable wholesale rate. The price per gallon is based upon the delivery of a
full transport truckload of product. All prices charged by Atlantis are subject
to the provisions of applicable law. It is estimated that pursuant to the FSA,
Atlantis will supply at least 44,000,000 gallons of diesel fuel for the first
year and increase thereafter as Plazas increases its market share.





The
obligations of Plaza under the FSA have been guaranteed by Properties, which
guaranty is limited to a thirty day period beginning thirty days prior to
Atlantis’ written notice to Properties of Plazas’ breach of the
FSA.





Doswell Sale
Agreement





On May
12, 2008, Plazas entered into a sale agreement with T.S.O., Inc. (“TSO”) for the
sale of Plaza’s assets located at its leased Doswell, VA travel
plaza.  In exchange for total consideration to Plazas of approximately
$0.4 million, Plazas has agreed to transfer to TSO title to all tangible and
intangible assets (excluding corporate records) and liabilities relating to the
operations of the Doswell, VA travel plaza.  Under the sale agreement,
TSO had until October 12, 2008 to obtain and deliver a firm commitment letter
for the purchase price. By letter dated November 6, 2008, the owner of the real
property underlying the Doswell travel plaza sent a notice to TSO terminating
the contract of sale.  During the period July 12, 2008 through
termination of the contract of sale, TSO is obligated to pay the Company rent in
the amount of $75,000 per month.




43


Filing
Requirements





This
Annual Report on Form 10-K for the year ended June 30, 2008 was filed beyond the
applicable filing deadline.




44




ABLE
ENERGY, INC. AND SUBSIDIARIES


Consolidated
Financial Statements




For the
Years Ended


June 30,
2008 and 2007










PageReport of
      Independent Registered Public Accounting Firm - Lazar Levine & Felix,
      LLP
            F-2Consolidated Balance
      Sheets as of June 30, 2008 and 2007
            F-3Consolidated
      Statements of Operations for the Years Ended June 30, 2008 and
    2007
            F-4Consolidated
      Statements of Stockholders' Equity for the Years Ended June 30, 2008 and
      2007
            F-5Consolidated
      Statements of Cash Flows for the Years Ended June 30, 2008 and
    2007
            F-6Notes to
      Consolidated Financial Statements
            F-8






F-1




Lazar
Levine & Felix LLP


CERTIFIED PUBLIC
ACCOUNTANTS & BUSINESS CONSULTANTS
   REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
 
 
 To the
Stockholders and Board of Directors
 Able
Energy, Inc and Subsidiaries
 Rockaway,
New Jersey
 
 We have
audited the accompanying consolidated balance sheets of Able Energy, Inc. and
Subsidiaries (the “Company”) as of June 30, 2008 and 2007 and the related
consolidated statements of operations, stockholders' equity, and cash flows for
the each of the two years in the period ended June 30, 2008.  We have
also audited the financial statement schedule listed in the accompanying
index.  These financial statements and financial statement schedule
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements and financial statement
schedule based on our audits.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audits to obtain reasonable assurance about whether
the consolidated financial statements and financial statement schedule are free
of material misstatement.  We were not engaged to perform an audit of
the Company’s internal control over financial reporting.  Our audits
included consideration of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the
Company’s internal control over financial reporting.  Accordingly, we
express no such opinion.  An audit also includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements and financial statement schedule, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits  provides
a reasonable basis for our opinion.
 
 In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of the Company as of June 30,
2008 and 2007 and the results of its operations and its cash flows for each of
the two years in the period ended June 30, 2008, in conformity with accounting
principles generally accepted in the United States of
America.  Also, in our opinion, the financial statement schedule
presents fairly, in all material respects, the information set forth
therein.
 
 The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern.  As more fully described in
Note 2, the Company has incurred losses from continuing operations of
approximately $12,900,000 and $6,600,000 during the years ended June 30, 2008
and 2007, respectively, resulting in an accumulated deficit of approximately
$30,600,000 at June 30, 2008.  In addition, the Company has used cash from
operations of approximately $3,600,000 and $1,272,000 for the years ended June
30, 2008 and 2007, respectively, and has a working capital deficiency of
approximately $12,900,000 at June 30, 2008.  These conditions raise
substantial doubt about the Company's ability to continue as a going concern.
 Management's plans in regard to this matter are described in Note 2.
 The consolidated financial statements do not include anyadjustments
that might result from the outcome of this uncertainty.
 
  
 LAZAR
LEVINE & FELIX LLP
 Morristown,
New Jersey
 November
14, 2008




F-2




ABLE
ENERGY, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE
SHEETS




June
      30,2008
              
              
              2007ASSETSCurrent
      Assets:Cash
      and cash equivalents
              
              $
              3,025,577
              
              
              $
              3,034,183Accounts
      receivable, net of  allowance for doubtful accounts
      of$1,283,013
      and $744,253, at June 30, 2008 and
      2007,  respectively
              
              4,088,377
              
              
              
              5,648,996Inventories
              
              
              2,724,315
              
              
              
              4,191,790Notes
      receivable - current portion
              
              
              -
              
              
              
              725,000Advances
      to related parties
              
              
              -
              
              
              
              8,374,496Prepaid
      expenses and other current assets
              
              
              1,676,658
              
              
              
              1,169,175Total
      Current Assets
              
              
              11,514,927
              
              
              
              23,143,640Property
      and equipment, net
              
              
              6,414,011
              
              
              
              7,603,263Goodwill
              
              
              11,046,179
              
              
              
              11,139,542Intangible
      assets, net
              
              
              5,531,345
              
              
              
              5,970,303Deferred
      financing costs, net
              
              
              159,718
              
              
              
              225,430Security
      deposits
              
              
              76,818
              
              
              
              79,918Total
      Assets
              
              $
              34,742,998
              
              
              $
              48,162,096LIABILITIES
      & STOCKHOLDERS' EQUITYCurrent
      Liabilities:Line
      of credit
              
              $
              979,818
              
              
              $
              481,602Notes
      payable, current portion
              
              
              4,123,602
              
              
              
              3,236,168Capital
      leases payable, current portion
              
              
              366,804
              
              
              
              376,042Convertible
      debentures and notes payable, net of unamortizeddebt
      discounts of $623,962 and $1,784,233 as of June 30, 2008and
      2007, respectively
              
              
              2,164,094
              
              
              
              1,348,267Accounts
      payable and accrued expenses
              
              
              15,152,749
              
              
              
              17,711,401Customer
      pre-purchase payments and unearned revenue
              
              
              1,636,911
              
              
              
              3,615,087Total
      Current Liabilities
              
              
              24,423,978
              
              
              
              26,768,567Notes
      payable, less current portion
              
              
              3,369,340
              
              
              
              3,632,726Capital
      leases payable, less current portion
              
              
              320,890
              
              
              
              729,816Deferred
      income taxes
              
              
              247,000
              
              
              
              -Total
      Long Term Liabilities
              
              
              3,937,230
              
              
              
              4,362,542Total
      Liabilities
              
              
              28,361,208
              
              
              
              31,131,109COMMITMENTS
      AND CONTINGENCIESStockholders'
      Equity:Preferred
      Stock; par value $.001, authorized 10,000,000 shares;issued
      - none
              
              
              -
              
              
              
              -Common
      Stock; $.001 par value; 75,000,000 and 10,000,000 shares
      authorized;at
      June 30, 2008 and 2007, respectively;14,965,389
      and 14,950,947 shares issued and outstandingat
      June 30, 2008 and  2007, respectively
              
              
              14,966
              
              
              
              14,951Additional
      paid in capital
              
              
              37,856,321
              
              
              
              37,840,498Accumulated
      deficit
              
              
              (30,584,497
              )
              
              
              (17,671,264
              )Notes
      and loans receivable - related parties
              
              
              (905,000
              )
              
              
              (3,153,198
              )Total
      Stockholders' Equity
              
              
              6,381,790
              
              
              
              17,030,987Total
      Liabilities and Stockholders' Equity
              
              $
              34,742,998
              
              
              $
              48,162,096




See
accompanying notes to the consolidated financial statements
  F-3




ABLE
ENERGY, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF
OPERATIONS


For
      the years ended June 30,2008
              
              
              2007Net
      Sales
              
              $
              276,440,588
              
              
              $
              93,641,548Cost of Sales(exclusive
      of depreciation and amortizationshown separately
      below)
              
              
              258,857,934
              
              
              
              85,103,534Gross
      Profit
              
              
              17,582,654
              
              
              
              8,538,014Operating
      Expenses:Selling,
      general and administrative
              
              
              25,442,782
              
              
              
              11,805,324Depreciation
      and amortization
              
              
              1,888,906
              
              
              
              740,203Total
      Operating Expenses
              
              
              27,331,688
              
              
              
              12,545,527Loss
      from Operations
              
              
              (9,749,034
              )
              
              
              (4,007,513
              )Other
      Income (Expenses)Interest
      and other income
              
              
              518,744
              
              
              
              554,767Interest
      income - related parties
              
              
              235,938
              
              
              
              280,048Interest
      expense
              
              
              (2,213,955
              )
              
              
              (937,345
              )Interest
      expense-related party
              
              
              
              
              
              
              (11,671
              )Amortization
      of deferred financing costs
              
              
              (65,712
              )
              
              
              (814,088
              )Amortization
      of debt discounts on convertible debenturesand note
      payable
              
              
              (1,160,271
              )
              
              
              (1,286,135
              )Registration
      rights penalty
              
              
              (203,263
              )
              
              
              (381,542
              )Total
      Other Income (Expenses), Net
              
              
              (2,888,519
              )
              
              
              (2,595,966
              )Loss
      before provision for income taxes
              
              
              (12,637,553
              )
              
              
              (6,603,479
              )Provision
      for income taxes
              
              
              275,680
              
              
              
              28,824Net
      Loss
              
              $
              (12,913,233
              )
              
              $
              (6,632,303
              )Basic
      and diluted loss per common share
              
              $
              (0.86
              )
              
              $
              (1.60
              )Weighted
      average number of common shares outstanding-basic and
    diluted
              
              
              14,953,440
              
              
              
              4,133,090




See
accompanying notes to the consolidated financial statements
  F-4




ABLE
ENERGY, INC. AND SUBSIDIARIES
 CONDENSED
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
 For The Years Ended June 30, 2008
and  2007


Common
      StockShares
              
              
              Amount
              
              
              Additional
      Paid - in Capital
              
              
              Accumulated
      Deficit
              
              
              Notes
      andLoans
      Receivable-Related Parties
              
              
              Total
      Stockholders' EquityBalance
      June 30, 2006
              
              
              3,128,923
              
              
              $
              3,129
              
              
              $
              14,812,723
              
              
              $
              (11,038,961
              )
              
              $
              (2,104,805
              )
              
              $
              1,672,086Options
      granted to outside directors
              
              
              -
              
              
              
              -
              
              
              
              439,825
              
              
              
              -
              
              
              
              -
              
              
              
              439,825Common
      stock issued inconnection
      with option exercise
              
              
              12,500
              
              
              
              12
              
              
              
              54,488
              
              
              
              -
              
              
              
              -
              
              
              
              54,500Common
      stock issued inconnection
      with Summit settlement
              
              
              142,857
              
              
              
              143
              
              
              
              171,286
              
              
              
              
              
              
              
              
              
              
              
              171,429Discounts
      on convertibledebentures
      and note payable
              
              
              -
              
              
              
              -
              
              
              
              3,000,000
              
              
              
              -
              
              
              
              -
              
              
              
              3,000,000Amortization
      of deferred compensation
              
              
              -
              
              
              
              -
              
              
              
              123,843
              
              
              
              -
              
              
              
              -
              
              
              
              123,843Notes
      receivable from related partiesfor
      reimbursement of certain fees
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (590,000
              )
              
              
              (590,000
              )Issuance
      of notes receivable
              
              
              -and
      related accrued interestreceivable
      upon advance tostockholders
      and related party
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (458,393
              )
              
              
              (458,393
              )Issuance
      of stock for the purchaseof
      the assets of All AmericanPlaza,
      Inc.
              
              
              11,666,667
              
              
              
              11,667
              
              
              
              19,238,333
              
              
              
              -
              
              
              
              -
              
              
              
              19,250,000Net
      loss
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (6,632,303
              )
              
              
              -
              
              
              
              (6,632,303
              )Balance
      June 30, 2007
              
              
              14,950,947
              
              
              
              14,951
              
              
              
              37,840,498
              
              
              
              (17,671,264
              )
              
              
              (3,153,198
              )
              
              
              17,030,987Repayment
      of notes receivable fromrelated
      party
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              2,473,079
              
              
              
              2,473,079Interest
      related to notes receivable fromrelated
      party
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (224,881
              )
              
              
              (224,881
              )Common
      stock and warrants issued inconjunction
      with consultingagreement
              
              
              14,442
              
              
              
              15
              
              
              
              15,823
              
              
              
              
              
              
              
              
              
              
              
              15,838Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (12,913,233
              )
              
              
              
              
              
              
              (12,913,233
              )Balance
      June 30, 2008
              
              
              14,965,389
              
              
              $
              14,966
              
              
              $
              37,856,321
              
              
              $
              (30,584,497
              )
              
              $
              (905,000
              )
              
              $
              6,381,790




See
accompanying notes to consolidated financial statements
  F-5
  ABLE
ENERGY, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH
FLOWS
  For
      the years ended June 30,2008
                
                
                2007Cash
      flow from operating activities:Net
      loss
                
                $
                (12,913,233
                )
                
                $
                (6,632,303
                )Adjustments
      to reconcile net loss to net cashused
      in operating activities:Depreciation
      and amortization
                
                
                1,888,906
                
                
                
                740,203Provision
      for bad debts
                
                
                564,551
                
                
                
                107,167Amortization
      of discounts on convertible debentures and notes payable
                
                
                1,160,271
                
                
                
                1,286,135Amortization
      of deferred financing costs
                
                
                65,712
                
                
                
                814,088Accrual
      of interest income on note receivable and loan-related
    parties
                
                
                (224,881
                )
                
                
                (182,942
                )Loss
      on sale of Able Melbourne assets
                
                
                121,634
                
                
                
                -Stock
      - based compensation
                
                
                -
                
                
                
                735,096Gain
      on sale of property and equipment
                
                
                -
                
                
                
                (11,964
                )Derivative
      losses
                
                
                -
                
                
                
                926,170Noncash
      consulting fees
                
                
                15,838
                
                
                
                -(Increase)
      decrease in operating assets:Accounts
      receivable
                
                
                392,507
                
                
                
                585,218Advances
      to related parties
                
                
                -
                
                
                
                (8,374,496
                )Inventories
                
                
                1,433,805
                
                
                
                180,046Receivable
      from related parties
                
                
                -
                
                
                
                -Prepaid
      expenses and other current assets
                
                
                (509,409
                )
                
                
                (1,255,675
                )Security
      deposits
                
                
                3,100
                
                
                
                5,000Increase
      (decrease) in operating liabilities:Accounts
      payable and accrued expenses
                
                
                6,127,936
                
                
                
                10,042,855Customer
      pre - purchase payments unearned revenue
                
                
                (1,978,178
                )
                
                
                (236,711
                )Deferred
      income taxes
                
                
                247,000
                
                
                
                -Net
      cash used in operating activities
                
                
                (3,604,441
                )
                
                
                (1,272,113
                )Cash
      flows from investing activities:Purchases
      of property and equipment
                
                
                (343,836
                )
                
                
                (843,112
                )Cash
      acquired in purchase of Horsham Franchise, net of $128,000 cash
      paid
                
                
                -
                
                
                
                109,539Cash
      acquired in purchase of All American Plazas, Inc
                
                
                -
                
                
                
                2,201,977Advances\(repayments)
      (to)\from related parties
                
                
                2,473,079
                
                
                
                (1,580,451
                )Collection
      of notes receivable
                
                
                725,000
                
                
                
                231,878Net
      Cash recived on sale of Able Melbourne assets
                
                
                306,217Cash
      received on sale of property and equipment
                
                
                -
                
                
                
                13,884Net
      cash provided by investing activities
                
                
                3,160,460
                
                
                
                133,715Cash
      flows from financing activities:Net
      (repayments) borrowings under line of credit
                
                
                498,216
                
                
                
                (750,038
                )Proceeds
      from notes payable
                
                
                7,150,000
                
                
                
                1,200,000Repayment
      of notes payable
                
                
                (6,501,591
                )
                
                
                (1,043,617
                )Repayment
      of capital leases payable
                
                
                (366,806
                )
                
                
                (350,787
                )Proceeds
      from exercise of options
                
                
                -
                
                
                
                54,500Deferred
      financing costs
                
                
                -
                
                
                
                (82,207
                )Proceeds
      from sale of convertible debentures and notes payable
                
                
                -
                
                
                
                3,000,000Repayments
      of convertible debentures
                
                
                (344,444
                )
                
                
                -Net
      cash provided by financing activities
                
                
                435,375
                
                
                
                2,027,851Net
      increase in cash and cash equivalents
                
                
                (8,606
                )
                
                
                889,453Cash
      and cash equivalents at beginning of period
                
                
                3,034,183
                
                
                
                2,144,729Cash
      and cash equivalents at end of period
                
                $
                3,025,577
                
                
                $
                3,034,182
  See
accompanying notes to the consolidated financial statements
  F-6
  ABLE
ENERGY, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH
FLOWS-CONTINUED
 For
      the years endedJune
      30,2008
                
                
                2007Supplemental
      disclosure of cash flow information:Cash
      paid during the year for interest
                
                $
                2,075,398
                
                
                $
                949,015Reduction
      in goodwill since certain liabilities were not assumed by
      Plazas
                
                $
                93,363
                
                
                $
                -Transfer
      of Work in Progress in Property and Equipment from a previous periodto Intangible
      Assets
                
                $
                312,538
                
                
                $
                -Advance
      to related party utilized to settle trade payables
                
                $
                8,374,495
                
                
                $
                -Sale
      of Melbourne SubsidiaryNet
      cash selling price
                
                $
                306,217
                
                
                $
                -Less
      assets sold (carrying value):Accounts
      receivable, net of allowance
                
                $
                603,561
                
                
                $
                -Inventory
                
                
                33,670
                
                
                
                -Property,
      plant and equipment, net
                
                
                84,977
                
                
                
                -Accounts
      payable
                
                
                (218,638
                )
                
                
                -Notes
      payable
                
                
                (24,361
                )
                
                
                -Capital
      lease
                
                
                (51,358
                )
                
                
                -Net
      assets sold
                
                $
                427,851
                
                
                $
                -Non-cash
      loss on sale of assets
                
                $
                121,634
                
                
                $
                -Purchase
      of Horsham franchise from Able Oil Montgomery, Inc.:Assets
      acquired and liabilities assumed:Inventories
                
                $
                -
                
                
                $
                28,000Property
      and equipment
                
                
                -
                
                
                
                39,000Intangible
      assets-Customer lists
                
                
                -
                
                
                
                697,175Customer
      pre-purchase payments
                
                
                -
                
                
                
                (237,539
                )Business
      combination with All American Plazas, Inc.:Assets
      acquired and liabilities assumed:Accounts
      receivable-net
                
                $
                -
                
                
                $
                2,947,566Inventories
                
                
                -
                
                
                
                3,667,849Property
      and equipment
                
                
                -
                
                
                
                2,443,767Intangible
      assets-franchise agreements
                
                
                -
                
                
                
                64,156Intangible
      asset-option to acquire Properties real estate
                
                
                -
                
                
                
                5,000,000Prepaid
      expenses and other current assets
                
                
                -
                
                
                
                503,708Goodwill
                
                
                -
                
                
                
                11,139,542Accounts
      payable and accrued expenses
                
                
                -
                
                
                
                (5,604,025
                )Notes
      payable
                
                
                -
                
                
                
                (3,114,540
                )Property
      and equipment acquired through the assumption ofcapital lease
      obligations
                
                $
                -
                
                
                $
                402,775.00
  See
accompanying notes to condensed consolidated financial statements
  F-7
  Note
1 - Nature of Operations





Able
Energy, Inc. (“Able”) was incorporated on March 13, 1997, in the state of
Delaware. Its current wholly-owned subsidiaries are Able Oil Company, Inc.
(“Able Oil”), Able Energy New York, Inc. (“Able NY”), Able Oil Melbourne, Inc.
(inactive, as of February 8, 2008), (“Able Melbourne”), Able Energy Terminal,
LLC, PriceEnergy.com Franchising, LLC (inactive), Able Propane, LLC (inactive),
and its majority owned (67.3% as of June 30, 2008) subsidiary, PriceEnergy.com,
Inc. (“PriceEnergy”) and All American Plazas, Inc. (“Plazas”).  Able,
together with its operating subsidiaries, are hereby also referred to as the
Company.





On
February 8, 2008, (the “Closing Date”) the Company and Able Melbourne executed
an Asset Purchase Agreement (“APA”) with Able Oil of Brevard, Inc. (“Able
Brevard”), a Florida corporation, owned by a former employee of Able
Melbourne.  For consideration in the amount of $375,000, (net of cash
retained of $68,783) the APA provided for the sale to Able Brevard of all of the
tangible and intangible assets (excluding corporate books and records),
liabilities and lease obligations of Able Melbourne, as is, on the Closing Date
resulting in a loss of $121,634.





Since the
Company’s business combination with All American Plazas, Inc. (now known as All
American Properties, Inc.) on May 30, 2007 (see Note 4), the Company is engaged
in two primary business activities, organized in two segments; the Oil segment
and the Travel Plaza segment.





The
Company’s Oil Segment, consisting of Able Oil, Able NY, Able Energy Terminal,
LLC and PriceEnergy, is engaged in the retail distribution of, and the provision
of services relating to, #2 home heating oil, propane gas, kerosene and diesel
fuels. In addition to selling liquid energy products, the Company offers
complete heating, ventilation and air conditioning (“HVAC”) installation and
repair and other services and also markets other petroleum products to
commercial customers, including on-road and off-road diesel fuel, gasoline and
lubricants.  Please refer to Note 21 - Subsequent Events, for
disclosure relating to the July 22, 2008 sale of 49% of the common stock of Able
NY and the sale of a portion of the Company’s Oil Segment operations in Easton
and Horsham PA (“Able PA”) and the October 31, 2008 agreement pursuant to which
the Company was granted the right to repurchase those shares of stock in Able NY
and the interest in Able PA.





The
Company’s Travel Plaza Segment, operated by Plazas, is engaged in the retail
sale of food, merchandise, fuel, personal services, onsite and mobile vehicle
repair, services and maintenance to both the professional and leisure driver
through a current network of ten travel plazas, located in Pennsylvania, New
Jersey, New York and Virginia.





Note
2 - Going Concern and Management’s Plans





The
accompanying consolidated financial statements have been prepared in conformity
with United States generally accepted accounting principles, which contemplate
continuation of the Company as a going concern and assume realization of assets
and the satisfaction of liabilities in the normal course of business. The
Company has incurred losses from continuing operations during the years ended
June 30, 2008 and 2007 of approximately, $12.9 million and $6.6 million,
respectively, resulting in an accumulated deficit balance of approximately $30.6
million as of June 30, 2008.  Net cash used in operations during the
years ended June 30, 2008 and 2007 was approximately $3.6 million and $1.3
million, respectively.  At June 30, 2008, the Company has a working
capital deficiency of $12.9 million.  These factors raise substantial
doubt about the Company’s ability to continue as a going
concern.  These consolidated financial statements do not include any
adjustments relating to the recoverability of the recorded assets or the
classification of the liabilities that may be necessary should the Company be
unable to continue as a going concern.





On May 30, 2007, the Company completed
a business combination with All American Plazas, Inc., now known as All American
Properties, Inc. (“Properties”) (See Note 14).  The Company is
pursuing sales initiatives, cost savings and credit benefits as contemplated in
the business combination including consolidation of business operations where
management of the Company deems appropriate for the combined entity. In order to
conserve its capital resources and to provide incentives for the Company’s
employees and other service vendors, the Company expects to continue to issue,
from time to time, common stock and stock options to compensate employees and
non-employees for services rendered. The Company is focusing on expanding
its distribution programs and new customer relationships to increase demand for
its products. In addition, the Company is pursuing other lines of business,
which include expansion of its current commercial business into other products
and services such as bio-diesel, solar energy and other energy related home
services. The Company is also evaluating, on a combined basis, all of its
product lines for cost reductions, consolidation of facilities and efficiency
improvements. There can be no assurance,
however, that the Company will be successful in achieving its operational
improvements which would enhance its liquidity situation.




F-8




Note
2 - Going Concern and Management’s Plans – continued


The Company’s net loss for the year
ended June 30, 2008 was approximately $12.9 million, including non-cash charges
totaling approximately $3.8 million. The Company has been funding its operations
through an asset-based line of credit and the issuance of notes
payable.





The Company is pursuing other lines
of business, which include expansion of its current commercial business into
other products and services such as bio-diesel, solar energy and other energy
related home services.  The Company is also evaluating all of its business
segments for cost reductions, consolidation of facilities and efficiency
improvements.  There can be no assurance that the Company will be
successful in its efforts to enhance its liquidity situation.





The Company will require some
combination of the collection of Properties notes receivable, new financing,
restructuring of existing financing, improved receivable collections and/or
improved operating results in order to maintain adequate liquidity over the
course of the year ending June 30, 2009.   The Company must also
bring current each of its Securities and Exchange Commission (“SEC”) filings as
part of a plan to raise additional capital.  In addition to the filing
of this Form 10-K for the year ended June 30, 2008, the Company must also
complete and timely file its Form 10-Q for the quarter ended September 30,
2008.





There can
be no assurance that the financing or the cost saving measures as identified
above will be satisfactory in addressing the short-term liquidity needs of the
Company.  In the event that these plans cannot be effectively
realized, there can be no assurance that the Company will be able to continue as
a going concern.





Note
3 - Summary of Significant Accounting Policies





Principles of
Consolidation





The
consolidated financial statements include the accounts of Able Energy, Inc. and
its subsidiaries.  All material inter-company balances and
transactions were eliminated in consolidation.





Cash and Cash
Equivalents





All
highly liquid investments purchased with a maturity of three months or less at
the time of purchase are considered cash equivalents.





Inventories





Inventories
consist principally of heating oil, diesel fuel, kerosene, propane and heating
equipment, related parts and supplies, and are valued at the lower of cost
(first in, first out method) or market.





June
      30,Product
              
              2008
              
              
              2007#2
      heating oil
              
              $
              131,418
              
              
              $
              327,757Diesel
      fuel
              
              
              36,351
              
              
              
              59,086Kerosene
              
              
              20,115
              
              
              
              10,176Propane
              
              
              37,632
              
              
              
              15,980Parts,
      supplies, equipment and other
              
              
              201,823
              
              
              
              213,484Fuels
              
              
              791,674
              
              
              
              1,260,653Non-fuel,
      merchandise, etc.
              
              
              1,505,302
              
              
              
              2,304,654Total
              
              $
              2,724,315
              
              
              $
              4,191,790




F-9




Note
3 - Summary of Significant Accounting Policies-continued




Property
and Equipment




Property
and equipment are stated at cost less accumulated
depreciation.  Depreciation is provided by using the straight-line
method based upon the estimated useful lives of the assets as
follows:





Vehicles,
      Machinery and Equipment, Office Furniture,Fixtures
      and Equipment
            5-10
      yearsFuel
      Tanks
            10
      yearsCylinders
      – Propane
            20
      yearsBuildings
            20-40
      yearsBuilding
      Improvements
            20
      yearsLeasehold
      Improvements
            Lesser
      of useful life orlife
      of lease





Upon
retirement or other disposition of these assets, the cost and related
accumulated depreciation and amortization of these assets are removed from the
accounts and the resulting gains or losses are reflected in the consolidated
results of operations. Expenditures for maintenance and repairs are charged to
operations as incurred. Renewals and betterments are capitalized.




Intangible
Assets




Intangible
assets include customer lists, website development costs and an option to
purchase real estate from Properties.  Costs incurred in the
developmental stage for computer hardware and software have been capitalized in
accordance with Emerging Issues Task force (“EITF”) 00-2, “Accounting for Web
Site Development Costs,” and are amortized on a straight-line basis over the
estimated useful life of 5 years.




Customer
lists related to various acquisitions are being amortized over lives of 10-15
years.




The
option to purchase the real estate of Properties is being amortized over 10
years, the life of the lease, including automatic renewal options.




Impairment
of Long-Lived Assets




Long-lived
assets, including property and equipment and intangible assets are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of such assets may not be recoverable.  Recoverability
of assets to be held and used is measured by comparison of the carrying value of
an asset to the undiscounted future cash flows expected to be generated by the
asset.  If the carrying value of an asset exceeds its estimated
undiscounted future cash flows, an impairment provision is recognized to the
extent the book value of the asset exceeds estimated fair
value.  Assets to be disposed of are reported at the lower of the
carrying amount or the fair value of the asset, less all associated costs of
disposition.




Based
upon an assessment in accordance with Statement of Financial Accounting
Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets”, there has
been no impairment of the intangible assets.




Deferred
Financing Costs




In
connection with the Company’s issuance of convertible debentures, notes payable
and obtaining a line of credit, the Company incurred certain costs, which were
capitalized and are being amortized over the life of the related debt
obligation.  For convertible debentures that are converted into common
stock, the pro-rata portion of the deferred financing cost is amortized
immediately upon conversion.




F-10


Note 3 - Summary of Significant
Accounting Policies – continued




Goodwill




Goodwill
information is as follows:




Year
      ended June 30,2008
              
              
              2007Goodwill-beginning
      of year
              
              $
              11,139,542
              
              
              $
              -Acquired
              
              
              -
              
              
              
              11,139,542Adjustments
              
              
              (93,363
              )
              
              
              -Goodwill-end
      of year
              
              $
              11,046,179
              
              
              $
              11,139,542




Statement
of Financial Accounting Standard No. 142, “Goodwill and Other Intangible
Assets” (“SFAS No. 142”) requires that purchased goodwill and
indefinite-lived intangibles not be amortized.  Rather, goodwill and
indefinite-lived intangible assets are subject to at least an annual assessment
for impairment by applying a fair value-based test.




SFAS No.
142 requires a two-step approach to testing goodwill for impairment for each
reporting unit.  Our reporting units are determined by the components
that constitute a business for which both, (1) discreet financial information is
available and, (2) management of the reporting Segment regularly reviews the
operating results of that component.  The first step tests for
impairment by applying fair value-based tests at the reporting Segment
level.  The second step (if necessary) measures the amount of
impairment by applying fair value-based tests to individual assets and
liabilities within each reporting unit.  We completed our annual
goodwill impairment testing as of June 30, 2008 and found no indicators of
impairment of our recorded goodwill.




Use
of Estimates




The
preparation of the consolidated financial statements in conformity with United
States generally accepted accounting principles requires the use of estimates
that affect the reported amounts of assets, liabilities, revenues and
expenses.  These estimates are based on historical experience and
various other factors that we believe to be reasonable under the circumstances,
the results of which form the basis for our conclusions.  We
continually evaluate the information used to make these estimates as the
business and economic environment changes.  Actual results may differ
from these estimates under different assumptions or conditions.  Such
differences could have a material impact on our future financial position,
results of operations and cash flows.




The
Company records adjustments to the minority interests in PriceEnergy for the
allocable portion of income or loss to which the minority interest holders are
entitled.  The Company suspends allocation of losses to minority
interest holders when the minority interest balance for a particular minority
interest holder is reduced to zero.  Any excess loss above the
minority interest holder’s balance is not charged to minority interests as the
minority interest holders have no obligation to fund such
losses.  Thus, the Company suspended the allocation of minority
interest in fiscal 2008 and 2007.




Joint
Ventures




The
Company may from time to time enter into joint venture arrangements with third
parties.   For 50% or less joint venture interests, the
Company will reflect its investment in the joint venture as investments in
non-consolidating subsidiaries on the consolidated balance sheet.  
For 51% or more interests, the Company consolidates the joint venture
results with that of the Company.  The Company has not entered into
any joint ventures during the two year period ended June 30, 2008.




F-11


Note
3 - Summary of Significant Accounting Policies – continued




Income
Taxes




The
Company provides for income taxes based on the provisions of Financial
Accounting Standards Board (“FASB”) Statement of Financial Accounting Standards
(“SFAS”) No. 109, “Accounting for Income Taxes”, which requires recognition of
deferred tax assets and liabilities for the expected future tax consequences of
events that have been included in the financial statements and tax returns in
different years.  Under this method, deferred income tax assets and
liabilities are determined based on the difference between the financial
statement and tax bases of assets and liabilities using enacted tax rates in
effect for the year in which the differences are expected to
reverse.  Valuation allowances are provided against deferred tax
assets to the extent that it is more likely than not that the deferred tax
assets will not be realized.




Deferred
tax assets pertaining to windfall tax benefits on exercise of non-qualified
stock options and the corresponding credit to additional paid-in capital are
recorded if the related tax amount either reduces income taxes payable or
results in an income tax refund.  The Company has elected the “with
and without approach” regarding ordering of windfall tax benefits to determine
whether the windfall tax benefit did reduce income taxes payable or resulted in
an income tax refund in the current year.  Under this approach, the
windfall tax benefits would be recognized in additional paid-in capital only if
an incremental income tax benefit is realized after considering all other income
tax benefits presently available to the Company.




The Tax
Reform Act of 1986 limits the use of net operating loss and tax credit carry
forwards in certain situations where disqualifying changes occur in the stock
ownership of a company.  In the event the Company experiences a
disqualifying change in ownership, utilization of the carry forwards could be
restricted.




Concentrations
of Credit Risk




Cash: The
Company maintains its cash with various financial institutions in excess of the
federally insured limit.  At June 30, 2008 and 2007, the Company had
cash on deposit of approximately $1.4 million and $1.6 million, respectively, in
excess of federally insured limits.




Accounts
Receivable: The number of clients that comprise the Company's client base limits
concentrations of credit risk with respect to accounts receivable. The Company
does not generally require collateral or other security to support client
receivables.  The Company has established an allowance for doubtful
accounts based upon facts surrounding the credit risk of specific clients and
past collections history. Credit losses have been within management's
expectations.




Advertising




Advertising
costs are expensed at the time the advertisement takes
place.  Advertising expense was approximately $908,000 and $500,000
for the years ended June 30, 2008 and 2007, respectively.




Shipping
and Handling Costs




Shipping
and handling costs incurred by the Company in connection with the purchase and
delivery of fuel oil inventory and fuels were approximately $1,520,000 and
$351,000 for the years ended June 30, 2008 and 2007, respectively, and are
recognized as a component of cost of sales within the consolidated statement of
operations.




F-12


Note
3 - Summary of Significant Accounting Policies – continued





Revenue
Recognition and Unearned Revenue and Customer Pre-Purchased
Payments




Sales of
travel plaza services, fuel and heating equipment are recognized at the time of
delivery to the customer, and sales of equipment are recognized at the time of
installation.  Revenue from repairs and maintenance service is
recognized upon completion of the service.  Payments received from
customers for heating equipment service contracts are deferred and recognized
over the term of the respective service contracts, on a straight-line basis,
which generally do not exceed one year. Payments received from customers for the
pre-purchase of fuel is recorded as a current liability until the fuel is
delivered to the customer, at which time it is recognized as revenue by the
Company.




Derivative
Contracts




The
Company uses derivative instruments (futures contracts) to manage the commodity
price risk inherent in the purchase and sale of #2 heating oil. Derivative
instruments are required to be marked to market under SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities" (“SFAS 133”), as amended.
These contracts are designated as cash flow hedges in accordance with SFAS 133
and are recorded at fair value as a liability entitled “fuel derivative
contracts” on the Company's consolidated balance sheet.




The
Company believes that these futures contracts for fuel oil have been effective
during their term to offset changes in cash flow attributable to the hedged
risk. The Company performs a prospective and retrospective assessment of the
effectiveness of the futures contracts at least on a quarterly basis. All
unrealized gains or losses on the futures contracts at each reporting date are
included in accumulated other comprehensive loss in the equity section of the
condensed consolidated balance sheet and in comprehensive loss until the related
fuel purchases being hedged are sold at which time such gains or losses are
recorded in cost of sales in the consolidated statements of operations. However,
if the Company expects at any time that continued reporting of a loss in
accumulated other comprehensive income would lead to recognizing a net loss on
the combination of the futures contracts and the hedged transaction in one or
more future periods, a loss is reclassified into cost of goods sold for the
amount that is not expected to be recovered. All contracts were closed as of
June 30, 2007.  As of June 30, 2007, all realized losses on futures
contracts were recorded in cost of goods sold in the consolidated statement of
operations in the amount of approximately $900,000. There were no such
gains or losses in the year ended June 30, 2008.




Net
Loss per Share




Basic net
loss per common share is computed based on the weighted average number of shares
of common stock outstanding during the periods presented. Common stock
equivalents, consisting of stock options, warrants, and convertible notes and
debentures as further discussed in the notes to the consolidated financial
statements, were not included in the calculation of diluted loss per share
because their inclusion would have been anti-dilutive.




The total
common shares issuable upon the exercise of stock options and warrants, and
conversion of convertible debentures (along with related accrued interest)
excluded from comparative diluted loss per share was 7,127,524 and 7,102,524
shares at June 30, 2008 and  2007, respectively.




Presentation
of Motor Fuel Taxes
Remitted to Government Authorities




The
Company’s Travel Plaza Segment is charged motor fuel taxes by its suppliers, and
these suppliers remit these taxes to government agencies.  The Travel
Plaza Segment then collects these taxes from consumers at the time of
sale.  Net sales and cost of sales in our consolidated statements
of operations included fuel taxes of $30.0 million and $3.4 million for the
years ended June 30, 2008 and 2007, respectively.





F-13





Note
3 - Summary of Significant Accounting Policies – continued





Recent
Accounting Pronouncements




In June
2005, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 154,
“Accounting Changes and Error Corrections” (“SFAS 154”). SFAS 154 establishes
new standards on accounting for changes in accounting principles. Pursuant to
the new rules, all such changes must be accounted for by retrospective
application to the financial statements of prior periods unless it is
impracticable to do so. SFAS 154 completely replaces APB No. 20 and SFAS 6,
though it carries forward the guidance in those pronouncements with respect to
accounting for changes in estimates, changes in the reporting entity, and the
correction of errors. The requirements in SFAS 154 are effective for accounting
changes made in fiscal years beginning after December 15, 2005. The Company
applied these requirements to any accounting changes after the implementation
date. The application of SFAS 154 did not have an impact on the Company’s
consolidated financial position, results of operations or cash
flows.




In June
2005, the FASB ratified Emerging Issues Task Force (“EITF”) No. 05-1,
“Accounting for the Conversion of an Instrument That Becomes Convertible upon
the Issuer’s Exercise of a Call Option” (“EITF No. 05-1”) which addresses that
no gain or loss should be recognized upon the conversion of an instrument that
becomes convertible as a result of an issuer’s exercise of a call option
pursuant to the original terms of the instrument. EITF No. 05-1 is effective for
periods beginning after June 28, 2006. The adoption of this pronouncement did
not have an effect on the Company’s consolidated financial position, results of
operations or cash flows.




In June
2005, the FASB ratified EITF Issue No. 05-2, “The Meaning of ‘Conventional
Convertible Debt Instrument’ in EITF Issue No. 00-19, “Accounting for Derivative
Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own
Stock”, which addresses when a convertible debt instrument should be considered
conventional for the purpose of applying the guidance in EITF No. 00-19. EITF
No. 05-2 also retained the exemption under EITF No. 00-19 for conventional
convertible debt instruments and indicated that convertible preferred stock
having a mandatory redemption date may qualify for the exemption provided under
EITF No. 00-19 for conventional convertible debt if the instrument’s economic
characteristics are more similar to debt than equity. EITF No. 05-2 is effective
for new instruments entered into and instruments modified in periods beginning
after June 29,
2005. The Company has applied the requirements of EITF No. 05-2 since the
required implementation date. The adoption of this pronouncement did not have an
effect on the Company’s consolidated financial position, results of operations
or cash flows.




EITF
Issue No. 05-4 “The Effect of a Liquidated Damages Clause on a Freestanding
Financial Instrument Subject to EITF Issue No. 00-19, ‘Accounting for Derivative
Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own
Stock”, addresses financial instruments, such as stock purchase warrants, which
are accounted for under EITF 00-19 that may be issued at the same time and in
contemplation of a registration rights agreement that includes a liquidated
damages clause. The consensus of EITF No. 05-4 has not been
finalized.




In
February 2006, the FASB issued SFAS No. 155 - “Accounting for Certain
Hybrid Financial Instruments”, which eliminates the exemption from applying SFAS
133 to interests in securitized financial assets so that similar instruments are
accounted for similarly regardless of the form of the instruments. SFAS 155 also
allows the election of fair value measurement at acquisition, at issuance, or
when a previously recognized financial instrument is subject to a remeasurement
event. Adoption is effective for all financial instruments acquired or issued
after the beginning of the first fiscal year that begins after
September 15, 2006. Early adoption is permitted. The adoption of SFAS 155
has not had a material effect on the Company’s consolidated financial position,
results of operations or cash flows.




In March
2006, the FASB issued SFAS No. 156, “Accounting for Servicing of Financial
Assets”, which amended SFAS No. 140, “Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities”, with respect to the
accounting for separately recognized servicing assets and servicing
liabilities.  SFAS 156 permits an entity to choose either the
amortization method or the fair value measurement method for each class of
separately recognized servicing assets or servicing
liabilities.  Adoption is effective after the beginning of the first
fiscal year that begins after September 15, 2006.  The application of
this statement has not had a material impact on the Company’s consolidated
financial statements.





F-14





Note
3 - Summary of Significant Accounting Policies – continued




Recent Accounting Pronouncements –
continued




In July
2006,  the FASB  issued  FASB  Interpretation  No.
48,  "Accounting  for Uncertainty in Income Taxes - an 
interpretation  of FASB Statement No. 109" ("FIN 48"),  which 
clarifies the accounting  for  uncertainty  in tax
positions.  This interpretation requires  that the Company
recognize in its consolidated financial  statements,  the impact
of a tax  position,  if that  position  is more  likely
than not of being sustained  on  audit,  based  on 
the  technical  merits  of the  position.  The
provisions of FIN 48 are effective as of the beginning of the
Company's year ending June 30, 2007, with the cumulative effect of the change in
accounting principle recorded as an adjustment to opening retained
earnings.  The application of this statement has not had a material
impact on the Company’s consolidated financial statements.




In
September 2006, the FASB issued SFAS No.157, “Fair Value Measurements”, which
defines fair value, establishes a framework for measuring fair value in United
States generally accepted accounting principles, and expands disclosures about
fair value measurements.  This statement does not require any new fair
value measurements, but provides guidance on how to measure fair value by
providing a fair value hierarchy used to classify the source of the
information.  SFAS No. 157 is effective for fiscal years beginning
after November 15, 2007, and all interim periods within those fiscal
years.  In February 2008, the FASB released FASB Staff Position (FSP
FAS 157-2 – Effective Date of FASB Statement No. 157) which delays the effective
date of SFAS No. 157 for all non-financial assets and nonfinancial liabilities,
except those that are recognized or disclosed at fair value in the financial
statements on a recurring basis (at least annually), to fiscal years beginning
after November 15, 2008 and interim periods within those fiscal
years.  The Company is currently evaluating the impact of adoption of
this statement on its financial and nonfinancial assets and
liabilities.




In
December 2006, the FASB issued FASB Staff Position (“FSP”) EITF 00-19-2
“Accounting for Registration Payment Arrangements” (“FSP EITF 00-19-2”) which
specifies that the contingent obligation to make future payments or otherwise
transfer consideration under a registration payment arrangement should be
separately recognized and measured in accordance with SFAS No. 5, “Accounting
for Contingencies.”  Adoption of FSP EITF 00-19-02 is required for
fiscal years beginning after December 15, 2006, and did not have a material
impact on the Company’s consolidated financial position, results of operations
or cash flows.




In
February 2007, the FASB issued SFAS No. 159 "The Fair Value Option for Financial
Assets and Financial Liabilities - Including an amendment of FASB Statement No.
115", which permits entities to choose to measure many financial instruments and
certain other items at fair value.  The fair value option established
by this Statement permits all entities to choose to measure eligible items at
fair value at specified election dates. A business entity shall report
unrealized gains and losses on items for which the fair value option has been
elected in earnings at each subsequent reporting date.  Adoption is
required for fiscal years beginning after November 15, 2007. Early adoption is
permitted as of the beginning of a fiscal year that begins on or before November
15, 2007, provided the entity also elects to apply the provisions of SFAS
Statement No. 157, Fair Value Measurements.   The application of
this Statement has not had a material impact on the Company’s consolidated
financial statements.




In
December 2007, the FASB issued SFAS No. 160 “Noncontrolling Interests in
Consolidated Financial Statements–an amendment of ARB No. 51.”  SFAS
160 establishes accounting and reporting standards pertaining to ownership
interests in subsidiaries held by parties other than the parent, the amount of
net income attributable to the parent and to the noncontrolling interest,
changes in a parent’s ownership interest and the valuation of any retained
noncontrolling equity investment when a subsidiary is
deconsolidated.  This statement also establishes disclosure
requirements that clearly identify and distinguish between the interests of the
parent and the interests of the noncontrolling owners.  SFAS 160 is
effective for fiscal years beginning on or after December 15,
2008.  TheCompany is in the
process of evaluating the effect that the adoption of SFAS 160 will have on its
consolidated results of operations, financial position and cash
flows.




F-15


Note
3 - Summary of Significant Accounting Policies – continued




Recent
Accounting Pronouncements – continued




In
December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business
Combinations” (SFAS 141R).  SFAS 141R establishes principles and
requirements for how an acquirer recognizes and measures in its financial
statements the identifiable assets acquired, the liabilities assumed, any
noncontrolling interest in the acquiree and the goodwill
acquired.  SFAS 141R also establishes disclosure requirements to
enable the evaluation of the nature and financial effects of the business
combination.  SFAS 141R is effective for financial statements issued
for fiscal years beginning after December 15, 2008.   The Company
is currently evaluating the potential impact of adoption of SFAS 141R on its
consolidated financial statements.




In March
2008, the FASB issued SFAS No. 161 “Disclosures about Derivative Instruments and
Hedging Activities”.  The new standard is intended to improve
financial reporting about derivative instruments and hedging activities by
requiring enhanced disclosures to enable investors to better understand their
effects on an entity’s financial statements issued for fiscal years and interim
periods beginning after November 15, 2008, with early adoption
encouraged.  The Company is currently evaluating the impact of
adopting SFAS No. 161 on its consolidated financial statements.




In May
2008, the FASB issued SFAS No. 162 “The Hierarchy of Generally Accepted
Accounting Principles”.  The new standard identifies the sources of
accounting principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy).  SFAS No. 162 will become
effective 60 days following the SEC’s approval of the Public Company Accounting
Oversight Board amendments to AU Section 411, The Meaning of Present Fairly
in Conformity With Generally Accepted Accounting Principles.  Adoption
of SFAS No. 162, upon its effectiveness, is not expected to have a material
impact on the Company's consolidated financial position, results of operations
or cash flows.




Reclassifications




Certain
reclassifications have been made to the June 30, 2007 consolidated financial
statements in order to conform to the current year presentation.




Stock-Based
Compensation




Prior to
July 1, 2005, the Company accounted for its stock options issued to employees
pursuant to APB 25, "Accounting for Stock Issued to
Employees”.  Accordingly, the Company would recognize employee
stock-based compensation expense only if it granted options at a price lower
than the closing price of the Company’s common stock on the date of grant. Any
resulting compensation expense would then have been recognized ratably over the
associated service period. The Company provided proforma disclosure amounts
in accordance with SFAS No. 148,
"Accounting for Stock-Based Compensation -Transition and Disclosure", as if the
fair value method defined by SFAS 123 had been applied to its stock-based
compensation.




Effective
July 1, 2005, the Company adopted the fair value recognition provisions of SFAS
123R, using the modified prospective transition method and therefore has not
restated prior periods' results. Under this transition method, employee
stock-based compensation expense for the year ended June 30, 2006 has included
compensation expense for all stock-based compensation awards granted, but not
yet fully vested, prior to July 1, 2005, utilizing the fair value of the options
as determined at the original grant date in accordance with the provisions of
SFAS 123.  Stock-based compensation expense for all share-based payment
awards granted after June 30, 2005 is based on the grant-date fair value
estimated in accordance with the provisions of SFAS 123R.




F-16


Note
3 - Summary of Significant Accounting Policies – continued





Stock-Based
Compensation – continued




The
Company recognizes these compensation costs over the requisite service period of
the award, which is generally the vesting term of the options.




The
Company recorded no stock-based employee compensation expense relating to the
Company’s stock option plan (See Note 13) for either of the years ended June 30,
2008 and 2007.  At June 30, 2008, there was no unamortized value of
employee stock options under SFAS 123R because all outstanding stock options at
June 30, 2007 were fully vested.




The
Company accounts for equity instruments issued to non-employees in accordance
with the provisions of SFAS 123 and the EITF Issue No.  96-18, 
“Accounting  for  Equity  Instruments  That Are Issued to
Other Than  Employees  for  Acquiring,  or In 
Conjunction  with Selling,  Goods or Services” which require that such
equity instruments are measured at the fair value of the consideration received
or the fair value of the equity instruments issued, whichever is more reliably
measured. The fair value determined is then amortized over the applicable
service period.  The Company recorded no stock-based compensation for
non-employees accounted for under EITF 96-18 in either of the years ended June
30, 2008 and 2007 (See Note 13). At June 30, 2008, there was no unamortized
value of non-employee stock options.




Option
valuation models require the input of highly subjective assumptions including
the expected life of the option. Because the Company's stock options have
characteristics significantly different from those of traded options, and
because changes in the subjective input assumptions can materially affect the
fair value estimate, in management's opinion, the existing models do not
necessarily provide a reliable single measure of the fair value of its employee
stock options. Due to the acquisition of certain assets and liabilities from
Properties on May 30, 2007, the Company has elected to use the “simplified
“method in determining the expected life, and ultimately, the value assigned to
these options due to the lack of available, sufficient historical option
exercise data.  The Company has not previously elected to use the
“simplified” method in valuing any of its option grants, and depending on data
available at the time, may or may not elect to use the “simplified” method when
valuing future grants of options.




F-17




Note
4 - Acquisitions





On
December 13, 2006, the Company purchased certain of the assets and assumed
certain liabilities of its Horsham franchise from Able Oil Montgomery, Inc., a
non-related party, for $764,175. Able Oil Montgomery is a full service retail
fuel oil and service company located in Horsham, Pennsylvania, which until this
acquisition, was a franchise operation of the Company and an entity to whom the
Company sold #2 heating oil.  This acquisition was accounted for
pursuant to SFAS No. 141, “Business Combinations” (“SFAS 141”) which requires
that the total purchase price be allocated to the fair value of the assets
acquired, including the intangible assets and liabilities, if any, assumed based
on their fair values at the acquisition date.  Accordingly, under the
purchase method of accounting, the assets acquired by the Company were recorded
at their respective preliminary fair values as of the date of acquisition,
summarized as follows:




Purchase
      of Horsham franchise from Able Oil Montgomery, Inc.:Assets
      acquired and liabilities assumed:Cash
              
              $
              237,539Inventories
              
              
              28,000Property
      and equipment
              
              
              39,000Intangible
      assets - Customer lists
              
              
              697,175Customer
      pre - purchase payments
              
              
              (237,539
              )Total
      purchase price
              
              $
              764,175Less:
      Cash paid to purchase Horsham Franchise
              
              
              (128,000
              )Non-cash
      consideration due to seller
              
              $
              636,175Non
      - cash consideration consisted of:Note
      payable due to seller
              
              $
              345,615Forgiveness
      of note receivable, accrued interest receivable and otherreceivable due from seller
              
              
              290,560$
              636,175




The
accompanying consolidated financial statements include the results of Horsham
franchise operations from December 13, 2006, the effective date of acquisition,
to June 30, 2008.




On May
30, 2007, the Company completed the purchase of certain of the assets and
assumed certain liabilities of its largest shareholder, All American Plazas,
Inc., a Pennsylvania corporation, for a purchase price of $19,250,000. The
consideration for the purchase price was the issuance of 11,666,667 shares of
the Company’s common stock at a price of $1.65 per share, the market price of
the Company’s common stock on the day of issuance.  Prior to the
purchase transaction, All American Plazas, Inc. owned approximately 31.8% of the
Company’s common stock.  After consummation of the purchase
transaction, All American Plazas, Inc., owned approximately 85.5% of the
Company’s outstanding common stock.  Approximately 85% of the
outstanding stock of All American Plazas, Inc. is beneficially held by the
Chelednik Family Trust by Mr. Frank Nocito, our Vice President of Business
Development, and his wife, Sharon Chelednik, for the benefit of their family
members, including seven children.  Mr. Nocito is also a Vice
President of All American Plazas, Inc.  In addition, pursuant to an
agreement between the Chelednik Family Trust and Gregory Frost, Our Chief
Executive Officer (“CEO”) and Chairman, through an entity controlled by him
(Crystal Heights, LLC), is the beneficial holder of approximately 15% of the
outstanding common stock of All American Plazas, Inc.  Subsequent to
the business combination, All American Plazas, Inc. changed its name to All
American Properties, Inc. (“Properties”). This business combination resulted in
the Company acquiring the operating assets of eleven multi-use truck stop
plazas, formerly operated by Properties, and assuming certain of Properties
debt.  Properties retained ownership of the underlying real property
on which each of the acquired travel plazas was situated.  The Company
formed a new wholly-owned subsidiary, All American Plazas, Inc. (“Plazas”), a
Delaware corporation, to operate the acquired plazas which constitute the
Company’s Travel Plaza Segment.




F-18


Note
4 - Acquisitions-continued





The
Company’s Travel Plaza Segment is engaged in the retail provision of food,
merchandise, fuel, lodging (in select locations), personal services, onsite and
mobile vehicle repair, services and maintenance to both the professional and
leisure driver through a current network of 10 travel plazas, located in
Pennsylvania, New Jersey, New York and Virginia.   Two of the
locations are operated under a Petro franchise, three operate under the Gables
brand name and the remaining travel plazas operate under the All American Plazas
banner.  The Travel Plaza Segment’s operations range from full service
facilities, such as the Milton Petro in Milton Pennsylvania, to facilities with
more limited amenities, such as the Gables of Harrisburg, located in Harrisburg,
Pennsylvania.  Full service facilities generally include separate gas
and diesel fueling islands, lodging, truck maintenance and repair services,
overnight parking with communication and entertainment pods, certified truck
weighing scales, restaurants and travel and convenience stores offering an array
of merchandise catering to the professional truck driver and other
motorists.




This
acquisition was also accounted for pursuant to SFAS 141 which requires that the
total purchase price be allocated to the fair value of the assets acquired,
including the intangible assets and liabilities, if any, assumed based on their
fair values at the acquisition date.  Accordingly, under the purchase
method of accounting, the assets acquired by the Company were recorded at their
respective fair values as of the date of acquisition, as adjusted during the
year ended June 30, 2008, summarized as follows:




Business
      combination with All American Plazas, Inc.:Assets
      acquired and liabilities assumed :Cash
      and cash equivalents
              
              $
              2,201,977Accounts
      receivable-net
              
              
              2,947,566Inventories
              
              
              3,667,849Property
      and equipment
              
              
              2,443,767Intangible
      assets-franchise agreements
              
              
              64,156Intangible
      asset-option to acquire Properties real estate
              
              
              5,000,000Prepaid
      expenses and other current assets
              
              
              503,708Goodwill
              
              
              11,046,179Accounts
      payable and accrued expenses
              
              
              (5,519,662
              )Notes
      payable
              
              
              (3,114,540
              )Total
      purchase price
              
              $
              19,250,000




The
accompanying consolidated financial statements include the results of Plaza’s
operations from June 1, 2007, the effective date of acquisition, to June 30,
2008.




The
following unaudited proforma statements of operations represent consolidated
results of operations of the Company had the acquisition of All American Plazas,
Inc. and Able Oil Montgomery, Inc. occurred for the current and proceeding
fiscal years, summarized as follows:




(Unaudited)
              
              For
      the Year EndingJune
      30, 2007Net
      revenue
              
              $
              282,241,850Net
      loss
              
              $
              (12,291,420
              )Basic
      and diluted loss per share
              
              $
              (0.83
              )




The above
unaudited proforma information does not purport to be indicative of what would
have occurred had the acquisitions been made as of such date or the results
which may occur in the future.




F-19


Note
5 - Notes Receivable





On March
1, 2004, the Company entered into two notes receivable totaling $1.4 million
related to the sale of its subsidiary, Able Propane, LLC. The notes are secured
by substantially all the assets of Able Propane, LLC. One note for $500,000
bears interest at a rate of 6% per annum and the other note for $900,000 is
non-interest bearing. Principal is payable in annual installments and interest
is paid quarterly with the final maturity date of March 1, 2008 for both
notes.  The balance outstanding of these two notes as of June 30, 2008
and 2007 was zero and $725,000, respectively. Interest earned on the
interest-bearing note for the years ended June 30, 2008 and 2007 was $20,000 and
$30,000, respectively.  The principal and interest due on the notes
was paid-in-full on March 6, 2008.




The
Company had a note receivable from Able Montgomery, Inc. (“Able Montgomery”) and
Andrew Schmidt (the owner of Able Montgomery) related to the sale of Able
Montgomery and certain assets to Mr. Schmidt. The note was dated June 15, 2000
for $170,000. The note bore interest at 9.5% per annum and payments commenced
October 1, 2000. The note was secured by the stock of Able Montgomery, Able
Montgomery’s assets, as well as a personal guarantee of Mr. Schmidt. The balance
outstanding on this note at June 30, 2007 was zero.  On December 13,
2006, the Company purchased the assets of Able Montgomery (See Note
4).  Included in the purchase consideration was the forgiveness of the
principal balance due and accrued interest on the above noted note
receivable.





Note
6 - Property and Equipment





Property
and equipment was comprised of the following at June 30, 2008 and
2007:




June
      30,2008
              
              
              2007Land
              
              $
              479,346
              
              
              $
              479,346Buildings
              
              
              1,674,124
              
              
              
              1,674,124Building
      improvements
              
              
              791,166
              
              
              
              906,685Trucks
      and autos
              
              
              4,349,790
              
              
              
              4,552,651Machinery
      and equipment
              
              
              1,848,895
              
              
              
              1,988,777Office
      furniture, fixtures and equipment
              
              
              1,371,183
              
              
              
              1,359,241Fuel
      tanks
              
              
              984,461
              
              
              
              1,008,129Cylinders
      - propane
              
              
              525,501
              
              
              
              486,309Construction
      in progress
              
              
              219,829
              
              
              
              -$
              12,244,295
              
              
              $
              12,455,263Less:
      accumulated depreciation
              
              
              (5,830,284
              )
              
              
              (4,852,000
              )Property
      and equipment, net
              
              $
              6,414,011
              
              
              $
              7,603,263




At June
30, 2008 and 2007 equipment held under the capital leases, included above, had a
net book value of $1,152,967 and $1,398,361, respectively.




Depreciation
of property and equipment, including the depreciation of equipment held under
capital leases, was $1,143,609 and $622,518 for the years ended June 30, 2008
and 2007, respectively.




F-20




Note
6 - Property and Equipment-continued




Closure
of Strattanville Travel Plaza




One of
the Travel Plazas Segments facilities, Strattanville, Pennsylvania, was
shut-down in April, 2008 due to unprofitable operations at that
site.  Management is exploring business opportunities relating to this
site.  All of the equipment at this facility could be transferred and
utilized at other locations.  As of June 30, 2008, $158,520 of
equipment has been classified as an idle asset and is no longer being
depreciated.




Doswell
Sale Agreement




On May
12, 2008, the Company entered into a sale agreement with T.S.O. Inc. (“TSO”) for
the sale of the Company’s operating assets located at its leased Doswell, VA
travel plaza.  In exchange for total consideration to the Company of
approximately $0.4 million, the Company has agreed to transfer to TSO title to
all tangible and intangible assets (excluding corporate records) and liabilities
relating to the operations of the Doswell, VA travel plaza.  TSO had
until October 12, 2008 to obtain and deliver a firm commitment letter for the
purchase price.  By letter dated November 6, 2008, Properties, the
owner of the real property underlying the Doswell travel plaza, sent a notice to
TSO terminating the contract of sale.  During the period July 12, 2008
through the termination of the contract of sale, TSO is obligated to pay the
Company rent in the amount of $75,000 per month.





Note
7 - Intangible Assets




Intangible
assets were comprised of the following:




For
      theYear Ended June 30,2008
              
              
              2007Weighted
              
              
              
              
              
              
              
              
              
              
              
              WeightedAverage
              
              
              
              
              
              
              
              
              
              
              
              AverageRemaining
              
              
              
              
              
              
              
              
              
              
              
              RemainingUseful
              
              
              Carrying
              
              
              Accumulated
              
              
              
              
              
              Useful
              
              
              Carrying
              
              
              AccumulatedLife
      (Yrs)
              
              
              Amount
              
              
              Amortization
              
              
              Net
              
              
              Life
      (Yrs)
              
              
              Amount
              
              
              Amortization
              
              
              NetCustomer
      lists
              
              
              7.7
              
              
              $
              1,308,025
              
              
              $
              552,903
              
              
              $
              755,122
              
              
              
              8.3
              
              
              $
              1,308,025
              
              
              $
              464,374
              
              
              $
              843,651Website
      development costs
              
              
              4.2
              
              
              
              312,538
              
              
              
              52,086
              
              
              
              260,452
              
              
              
              3.0
              
              
              
              2,394,337
              
              
              
              2,331,324
              
              
              
              63,013Franchise
      agreements
              
              
              9.1
              
              
              
              64,155
              
              
              
              6,717
              
              
              
              57,438
              
              
              
              9.1
              
              
              
              64,155
              
              
              
              516
              
              
              
              63,639Option
      to purchase real estate
              
              
              9.0
              
              
              
              5,000,000
              
              
              
              541,667
              
              
              
              4,458,333
              
              
              
              10.0
              
              
              
              5,000,000
              
              
              
              -
              
              
              
              5,000,000Total
              
              
              8.6
              
              
              $
              6,684,718
              
              
              $
              1,153,373
              
              
              $
              5,531,345
              
              
              
              9.7
              
              
              $
              8,766,517
              
              
              $
              2,796,214
              
              
              $
              5,970,303




The
estimated amortization of customer lists, website development costs, franchise
agreements and the option to purchase real estate for the five years ending June
30, 2013 and thereafter, is as follows:





Website
              
              
              
              
              
              Option
      toCustomer
              
              
              Development
              
              
              Franchise
              
              
              PurchaseFor the years ending June
    30,
              
              Lists
              
              
              Costs
              
              
              Agreements
              
              
              Real
      Estate
              
              
              Total2009
              
              $
              88,530
              
              
              $
              62,508
              
              
              $
              6,200
              
              
              $
              500,000
              
              
              $
              657,2382010
              
              
              85,209
              
              
              
              62,508
              
              
              
              6,200
              
              
              
              500,000
              
              
              
              653,9172011
              
              
              84,545
              
              
              
              62,508
              
              
              
              6,200
              
              
              
              500,000
              
              
              
              653,2532012
              
              
              59,167
              
              
              
              62,508
              
              
              
              5,811
              
              
              
              500,000
              
              
              
              627,4862013
              
              
              46,478
              
              
              
              10,420
              
              
              
              4,595
              
              
              
              500,000
              
              
              
              561,493Thereafter
              
              
              391,193
              
              
              
              -
              
              
              
              28,432
              
              
              
              1,958,333
              
              
              
              2,377,958$
              755,122
              
              
              $
              260,452
              
              
              $
              57,438
              
              
              $
              4,458,333
              
              
              $
              5,531,345





F-21




Note
7 - Intangible Assets - continued




Information
related to intangible assets for the years ended June 30, 2008 and 2007 is as
follows:




Twelve
      Months Ended June 30,2008
              
              
              2007Balance-Beginning
      of year
              
              $
              5,970,303
              
              
              $
              326,658Amounts
      capitalized
              
              
              312,538
              
              
              
              5,761,330Amortization
              
              
              (751,496
              )
              
              
              (117,685
              )Balance-End
      of year
              
              $
              5,531,345
              
              
              $
              5,970,303




Amortization
expense for intangible assets was $751,496 and $117,685 for the years ended June
30, 2008, and 2007, respectively. In fiscal 2008, the Company capitalized from
work in progress $312,538 of software development costs.  In
connection with the purchase of Horsham, the Company recorded a customer list
asset with a preliminary value of $697,175.  In connection with the
All American Plazas, Inc. now known as All American Properties,
Inc. (“Properties”) business combination in May 2007, the Company
assigned a fair value of $5.0 million for the contractual right to purchase
certain travel plaza real estate assets and the assumption of real estate
mortgages.  The Company also recognized a franchise agreement
intangible asset of $64,155 in conjunction with the business combination with
Properties.




Also in
conjunction with the business combination with Properties, the Company acquired
a ten-year option to acquire any of the travel plaza real estate owned by
Properties, providing that the Company assume all existing debt obligations
related to the applicable properties.  The option has been valued at
$5.0 million and is exercisable as long as the leases held by the Company's
subsidiary, All American Plazas, Inc. (“Plazas”), relating to the
applicable real estate remain in effect.  Plazas’ leases automatically
renew, upon the mutual consent of Plazas and Properties, for consecutive
one-year terms so that the total term of each lease shall be for a period of ten
years.




At June
30, 2008, the weighted average remaining life of the intangible assets was 8.6
years.





Note
8 - Deferred Financing Costs and Debt Discounts





The
Company incurred deferred financing costs in conjunction with the sale of
convertible debentures on July 12, 2005, July 5, 2006 and August 8, 2006 (See
Note 12), notes payable on May 13, 2005 (See Note 10), and a line of credit on
May 13, 2005 (See Note 9).  These costs were capitalized to deferred
financing costs and are being amortized over the term of the related
debt.  Amortization of deferred financing costs was $65,712 and
$814,088 for the years ended June 30, 2008 and 2007, respectively. The 2007
amount includes $715,000 charged to amortization of deferred financing costs
since the financing did not occur.




Additionally,
in accordance with EITF 00-27, “Application of Issue 98-5 to Certain Convertible
Instruments”, the Convertible Debentures issued on July 12, 2005, July 5, 2006
and August 8, 2006 were considered to have a beneficial conversion premium
feature. The Company recorded a debt discount of $5,500,000 related to this
conversion premium and warrants issued in connection with the
financing.  The Company amortized $1,160,271 and $1,286,135 of debt
discount during the years ended June 30, 2008 and 2007,
respectively.




F-22


Note
9 - Line of Credit





On May
13, 2005, the Company entered into a $1,750,000 line-of-credit agreement (the
“Agreement”) with Entrepreneur Growth Capital, LLC (“EGC”). The loan is secured
by certain eligible accounts receivable, inventory and certain other assets as
defined in the agreement. The line bears interest at Citibank's prime rate, plus
4% per annum (9.0% and 12.25% at June 30, 2008 and 2007, respectively) not to
exceed 24%, with a minimum interest of $9,000 per month. The line also requires
an annual facility fee and monthly collateral management fees equal to 2% and
0.025%, respectively. In addition, deposits were not credited to our account
until four business days after receipt by EGC.  On December 28, 2007
and February 11, 2008 the Company received over advances on this line in the
amounts of $250,000 for each date.  Repayment of these advances were
each 30 days.  Therefore, the effective interest rate for the year
ended June 30, 2008 and 2007 was 29.4% and 21.0%, respectively, and the average
amount outstanding against the line of credit at June 30, 2008 and 2007 was
$549,396 and $730,689, respectively.  The balance due as of June 30,
2008 and 2007 was $979,818 and $481,602, respectively, and $770,182 was
available under the line of credit at June 30, 2008.  The Agreement
renews annually unless terminated by either party, as provided for in the
Agreement.




On
February 25, 2008, the Company increased an existing credit line by executing a
Fuel Purchase Loan (“FPL”) agreement with EGC.  The increase, in the
amount of $0.5 million, is a further extension of credit under an existing May
13, 2005 agreement between the Company and EGC (the “Loan Agreement”) (See Note
13).  In addition to the general terms of the Loan Agreement, under
the repayment terms of the FPL, EGC will reduce the loan amount outstanding by
applying specific amounts from the Company’s availability under the Loan
Agreement.  These amounts start at $2,500 per business day, commencing
March 1, 2008, gradually increasing to $10,000 per business day on June 1, 2008
and thereafter until the FPL is paid in full.




In
further consideration for making the FPL, commencing February 22, 2008, EGC
shall be entitled to receive a revenue share of four cents ($0.04) per gallon of
fuel purchased with the FPL funds, subject to a $5,000 per week minimum during
the first seven weeks of the program.





Note
10 - Notes Payable and Notes Payable-Related Party





On May
13, 2005, the Oil Segment entered into a term loan with Northfield Savings Bank
for $3,250,000.  Principal and interest are payable in monthly
installments of approximately $21,400, commencing on July 1,
2005.  The note is secured by Company owned real property located in
Rockaway, New Jersey with a net book value of $839,057 at June 30, 2008 and an
assignment of leases and rents at such location. The initial interest rate is
6.25% per annum on the unpaid principal balance for the first five (5) years, to
be redetermined every fifth anniversary date (reset date) at 300 basis points
over the five (5) year United States Treasury rate, but not lower than the
initial rate; at that time the monthly payment will be redetermined. The
interest rate on default is 4% per annum, charged at the bank’s option, above
the interest rate then in effect.  At the maturity date of June 1,
2030, all amounts owed are due and payable. As of June 30, 2008 and 2007, the
Company was in default of two non-financial covenants under the agreement for
which the Company has received a waiver.  The balance outstanding on
this note at June 30, 2008 and 2007 was $3,071,844 and $3,134,990,
respectively.




On August
27, 1999, the Oil Segment entered into a note related to the purchase of
equipment and facilities from B&B Fuels, Inc.  The total original
principal balance of the note was $145,000.  The note is payable in
the monthly amount of principal and interest of $1,721 with an interest rate of
7.5% per annum through August 27, 2009.  The note is secured by a
mortgage granted by Able Energy New York, Inc. on properties at 2 and 4 Green
Terrace and 4 Horicon Avenue, Town of Warrensburg, Warren County, New
York.  The balance due on this note at June 30, 2008 and 2007 was
$23,003 and $41,186, respectively.




On
December 13, 2006, the Oil Segment entered into a 5 year note agreement relating
to the purchase of the Horsham Franchise in the amount of $345,615 (See Note
4).  The interest rate is 7.0% per annum and principal and interest is
payable in monthly installments of $6,844 which commenced on January 13, 2007.
The balance due on this note at June 30, 2008 and 2007 was $254,275 and
$316,225, respectively.





F-23





Note
10 - Notes Payable and Notes Payable-Related Party – continued





On
January 8, 2007, Plazas entered into an Account Purchase Agreement with Crown
Financial (“Crown”) whereby Crown advanced $1,444,775 to Plazas in exchange for
certain existing accounts receivables and taking ownership of new accounts
originated by Plazas.  Repayment of the loan is to be made from the
direct payments to Crown from the accounts it purchased from Plazas and a fee
equal to 2.5% of the outstanding advance for the preceding period payable on the
15th
and 30th day of
each month.  The Crown loan is secured by the mortgages on the real
property and improvements thereon owned by Properties known as the Strattanville
and Frystown Gables truck stop plazas and a personal guarantee by Frank
Nocito.  Subsequent to the May 2007 closing of the business
combination between the Company and Properties, on July 1, 2007 the Account
Purchase Agreement between Plazas and Crown Financial has been amended and
modified from “Eligible Accounts having a 60 day aging” to a “90 day aging that
are not reasonably deemed to be doubtful for collections” and the fee of 2.5%
payable on the 15th and
30th
day of each month has been modified to 1.375%. The Company has assumed this
obligation based on the business combination; however, Properties has agreed to
continue to secure this financing with the aforementioned real estate mortgages.
The balance due on this note at June 30, 2008 and 2007 was $817,367 and
$1,324,775, respectively.




On March
20, 2007, the Oil Segment entered into a credit card receivable advance
agreement with Credit Cash whereby Credit Cash agreed to loan the Company
$1,200,000. The loan is secured by the Company's existing and future credit card
collections.  Terms of the loan call for a repayment of $1,284,000,
which includes the one-time finance charge of $84,000, over a seven-month
period. This will be accomplished through Credit Cash withholding 18% of credit
card collections of Able Oil Company and 10% of credit card collections of
PriceEnergy.com, Inc. over the seven-month period which began on March 21, 2007.
There are certain provisions in the agreement which allows Credit Cash to
increase the withholding, if the amount withheld by Credit Cash over the
seven-month period is not sufficient to satisfy the required repayment of
$1,284,000. On July 18, 2007, August 3, 2007, November 7, 2007, January 18,
2008, February 14, 2008 and April 11, 2008, the Company, in accordance with its
agreement with Credit Cash, refinanced the loan in the amounts of $250,000,
$300,000, $1,100,000, $500,000, $500,000 and $800,000, respectively (see Note
10). The outstanding Credit Cash loan as of June 30, 2008 and 2007 was $292,619
and $493,521, respectively.  Please refer to Note 21 - Subsequent
Events, below for disclosure relating to disclosure of additional
transactions with Credit Cash, subsequent to June 30, 2008, that helped to
improve or affected the Company’s liquidity.




Prior to
the business combination between Properties and the Company, Properties entered
into a loan agreement with Credit Cash, which was an advance against credit card
receivables at the truck stop plazas then operated by Properties.  As
a result of the business combination, this obligation was assumed by the
Company’s newly formed, wholly-owned subsidiary, Plazas as it became the
operator of the truck stop plazas. Credit Cash, while acknowledging the business
combination, has continued to obligate both Properties and Plazas in their loan
documents as obligors of the loan.




On August
31, 2006, Plazas entered into a loan agreement with EGC/Credit Cash, relating to
the processing of its credit card transactions, in the initial amount of
$1,000,000.  The interest rate is prime plus 3.75%.  The
balance due on this note at June 30, 2008 and 2007 was $328,474 and $1,160,235,
respectively.




On July 16, 2007, Credit Cash agreed to
extend further credit of $400,000 secured by the credit card receivables at the
truck stops operated by Plazas.  This July 16, 2007 extension of
credit agreement was in addition to and supplemented all previous agreements
with Credit Cash. Terms of the original loan and extensions called for repayment
of $1,010,933 plus accrued interest which will be repaid through Credit Cash
withholding 15% of credit card collections from the operations of the truck stop
plazas until the loan balance is paid in full. The interest rate is prime plus
3.75% (12% at June 30, 2008). There are certain provisions in the agreement,
which allows the Lender to increase the withholding, if the amount it is
withholding is not sufficient to satisfy the loan in a timely manner. However,
on November 2, 2007 and again on January 18, 2008, Credit Cash again agreed to
extend an additional credit in the amount of $1,100,000 and $600,000,
respectively. Terms of the agreement are the same as the prior July 16, 2007
financing. On January 18, 2008 the Travel Plaza segment of the Company
refinanced its loan with Credit Cash for an additional amount of
$600,000.  There are certain provisions in the agreement, which allows
Credit Cash to increase the withholding, if the amount it is withholding is not
sufficient to satisfy the loan in a timely manner. This repayment percentage was
increased to 20% in April 2008 due to suspension of diesel sales in several
locations due to pricing and cash flow issues.  This 20% was
renegotiated in August 2008 down to 12%.




F-24







The
outstanding balance of the loan as of June 30, 2008 was $328,474 plus accrued
interest. Please refer to Note 21 - Subsequent Events, below for
disclosure relating to disclosure of additional transactions with Credit Cash,
subsequent to June 30, 2008, that helped to improve or affected the Company’s
liquidity.





From June
1, 2007 through June 30, 2007, during the post-closing period of the business
combination between the Company and Properties, Plazas made $8,374,495 in
payments to its fuel supplier, TransMontaigne, on behalf of
Properties.  These payments were not made from any capital infusion or
advances made by Plazas, but rather were generated from revenues from the
ongoing operations of the Travel Plaza Segment. These payments of $8.4 million
were included in the advances to related parties balance at June 30, 2007. On
October 5, 2007, Plazas along with Properties entered into an agreement with
TransMontaigne to provide for the continued supply of fuel for the travel
plazas, to extend a credit facility of $2.0 million to Plazas to purchase fuel
on a pre-paid basis and for Properties to provide certain real property as
collateral for its outstanding obligation to TransMontaigne for its fuel
purchases prior to the closing of the business combination. As a result of this
agreement, trade payables of $8.4 million owed by Plazas to TransMontaigne for
fuel purchased after the closing of the business combination, as well as
payments made by Plazas during that time period for obligations to
TransMontaigne owed by Properties for fuel purchases prior to the closing, were
reclassified and booked as obligations of Properties. This reclassification
correspondingly reduced Plazas obligations to TransMontaigne by the amount of
the payments it had made to TransMontaigne during the period from June 1, 2007
through June 30, 2007 on behalf of Properties referred to above. Thereafter, on
November 30, 2007, the parties amended their agreement and entered into an
Amended and Restated Note Agreement (the “Agreement”), which reduced Plazas’
line of credit for the purchase of fuel on a cash delivery basis to $1,550,000.
This reduced line of credit was evidenced by a promissory note (the “Note”) in
that amount and is outstanding at June 30, 2008. The Note does not accrue
interest until November 15, 2009 at which point, if the Note is not paid, it
accrues interest at 8% per annum. In addition to Plazas’ obligation to
TransMontaigne pursuant to the Note, as of November 30, 2007, Plazas owed
TransMontaigne the sum of $1.6 million in trade payables for additional fuel it
purchased from TransMontaigne after the closing of the business combination. Any
payment of these trade payables will correspondingly reduce Properties
obligations to TransMontaigne under the Agreement. As part of the Agreement,
Properties also made a note to TransMontaigne in an amount, which in accordance
with the reclassification, included the payments made by Plazas to
TransMontaigne on behalf of Properties during the post-closing transition
period. Collateral for the Note and Properties’ obligations to TransMontaigne
under the Agreement are certain real property owned by Properties. The Company
and Properties are currently in the process of renegotiating the terms of the
Agreement.




On
October 17, 2007, the Oil Segment entered into a loan agreement with S&S NY
Holdings, Inc. (“S&S”) for $500,000 to purchase #2 heating fuel. The term of
the agreement was for 90 days with an option to refinance at the end of the
90-day period for an additional 90 days. The repayment of the principal amount
was $0.10 cents per gallon of fuel sold to the Company’s customers excluding
pre-purchase gallons. An additional $0.075 per gallon was paid as interest. The
agreement also provides that in each 30-day period the interest amount can be no
less than $37,500. As of February 15, 2008 the Company had repaid $137,180
and exercised its right to refinance the amount until March 31, 2008. The amount
outstanding on this note at June 30, 2008 was $362,820.




On
December 20, 2007, the Oil Segment entered in to a second loan agreement with
S&S for $500,000 to purchase #2 heating fuel.  The term of the
agreement was through March 31, 2008.  The repayment of principle was
not due until the maturity date.  An additional $0.075 per gallon was
paid as interest. The agreement also provides that in each 30-day period the
interest amount can be no less than $37,500.  The outstanding balance
on this note was $500,000 at June 30, 2008.  On July 22, 2008, the
Company entered into an agreement with S&S which provided for repayment of
the loans from S&S in exchange for granting S&S a 49% interest in Able
Energy New York, Inc. (“Able NY”), a wholly owned subsidiary of the
Company, and a 90% interest in the Company’s Able PA operations (“Able
PA”).  This agreement was amended on October 31, 2008, granting the
Company the right to repurchase S&S’s interest in Able NY and Able
PA.  See, Note 21 Subsequent Events for disclosure relating to the
July 22, 2008 “S&S Settlement Agreement” and the October 31, 2008 “Amendment
to the S&S Settlement Agreement”.




F-25


Note
10 - Notes Payable and Notes Payable-Related Party - continued





On May 8,
2008, Plazas entered into a Fuel Supply Agreement (“FSA”) with Atlantis
Petroleum, LLC (“Atlantis”).  The FSA provides that for a term of
three years, Atlantis will be the sole and exclusive diesel fuel supplier to
eight (8) of the truck stop plazas operated by Plazas located in Pennsylvania.
The price per gallon of the diesel fuel supplied by Atlantis provides Plazas
with a favorable wholesale rate. The price per gallon is based upon the delivery
of a full transport truckload of product. All prices charged by Atlantis are
subject to the provisions of applicable law. It is estimated that pursuant to
the FSA, Atlantis will supply at least 44,000,000 gallons of diesel fuel for the
first year and increase thereafter as Plazas increases its market
share.




The
obligations of Plaza under the FSA have been guaranteed by Properties, which
guaranty is limited to a thirty day period beginning thirty days prior to
Atlantis’ written notice to Properties of Plazas’ breach of the
FSA.




In
addition, the Company has entered into 17 miscellaneous loan agreements and
notes that, as of June 30, 2008, the total amount due on all 17 items was
$292,540 with interest rates ranging from 0.97% to 15.2% and maturity dates
ranging from October 2009 to July 2011.




Maturities
on notes payable as of June 30, 2008 are as follows:





For
      the Year EndingJune
      30, 2008
              
              Amount2009
              
              
              $
              4,123,6022010
              
              
              
              257,8792011
              
              
              
              209,6962012
              
              
              
              125,7142013
              
              
              
              86,210Thereafter
              
              
              
              2,689,841Total
              
              $
              7,492,942





Note
11 - Capital Leases Payable





The
Company has entered into various capital leases for equipment expiring through
December 2012. The capital leases bear interest at rates ranging between 8% and
12% per annum. During the year ended June 30, 2007, the Company purchased
equipment under five capital leases amounting to $402,775.  There were
no such purchases in the year ended June 30, 2008.




The
following is a schedule of future minimum lease payments under capital leases
together with the present value of the net minimum lease payments as of June 30,
2008





For
      the YearEnding
      June 30,
              
              Amount2009
              
              $
              351,3932010
              
              
              212,3202011
              
              
              144,3282012
              
              
              63,3672013
              
              
              -Total
      minimum lease payments
              
              $
              771,409Less:
      amounts representing interest
              
              
              83,715Present
      value of net minimum lease payments
              
              $
              687,694Less:
      current portion
              
              
              366,804Long-term
      portion
              
              $
              320,890




F-26




Note
12 - Convertible Debentures





On July
12, 2005, the Company consummated a financing in the amount of $2,500,000
through the sale of Variable Rate Convertibles Debentures (the "Convertible
Debentures"). The Convertible Debentures had a term of two years from the date
of issuance, which term was amended on November 16, 2005, to 25 months, subject
to the occurrence of an event of default, with interest payable at the rate per
annum equal to LIBOR for the applicable interest period, plus 4%, payable on a
quarterly basis. The Convertible Debentures may be converted at the option of
the holders into shares of the Company’s common stock at a conversion price of
$6.50 per share. In addition, the purchasers received five-year warrants to
purchase 192,308 shares of common stock at an exercise price of $7.15 per
share.   These warrants are not exchangeable for
cash.  The Company has an optional redemption right (which right shall
be mandatory upon the occurrence of an event of default) to repurchase all of
the Convertible Debentures for 125% of the face amount of the Convertible
Debentures plus all accrued and outstanding interest, as well as a right to
repurchase all of the Convertible Debentures in the event of the consummation of
a new financing in which the Company sells securities at a purchase price that
is below the $6.50 conversion price.  Deferred financing costs related
to this transaction totaled approximately $217,000, including an $82,000 broker
fee and $135,000 in various legal expenses.




The
Company allocated the proceeds from the issuance of the Convertible Debentures
and warrants based on their respective fair values. As such, the Company
discounted the balance of the Convertible Debentures as of the date of issuance
and recorded $900,000 as an adjustment to additional paid-in capital related to
the warrants. In addition, the conversion feature of the Convertible Debentures
is characterized as a beneficial conversion feature. Pursuant to EITF No. 00-27,
the Company has determined that the value of the beneficial conversion feature
is $1,600,000. Accordingly, the Company has further discounted the balance of
the Convertible Debentures as of the date of issuance and recorded an adjustment
of $1,600,000 to additional paid-in capital.




During
the year ended June 30, 2006, Convertible Debentures totaling $2,367,500 in
principal amount, plus accrued interest totaling $49,563, were converted into
371,856 shares of the Company’s common stock. Amortization of the debt discounts
on this Convertible Debenture for the years ended June 30, 2008 and 2007 were
$7,737 and $63,016, respectively.




As of
June 30, 2008, the outstanding principal on the Convertible Debentures was
$132,500, and the debt discount was fully amortized.




The
Company also originally granted to the purchasers who acquired the Convertible
Debentures an additional investment right, exercisable for a period of eighteen
months from the original investment date of July 18, 2005, to purchase units
consisting of convertible debentures in the aggregate amount of up to
$15,000,000 (the "Additional Debentures") and common stock purchase warrants
equal to 50% of the face amount of such Additional Debentures (the "Additional
Warrants"). Upon exercise of the additional investment right, the Additional
Debentures are convertible into and the Additional Warrants could be exercised
for unregistered, restricted shares of the Company’s common stock.




As part
of a negotiated amendment of the purchase agreement, however, the rights of the
Company and the purchasers relating to the Additional Debentures and Additional
Warrants were eliminated as of November 16, 2005, and the purchase agreement was
amended to issue the purchasers a series of warrants (the "New Warrants") with
an exercise price of $7.50 per share. In the aggregate, the New Warrants permit
the holders to acquire up to 5.25 million shares of the Company's common stock
upon proper exercise. Notwithstanding the foregoing, until the required
stockholder approvals are obtained, the purchasers have agreed not to convert
any Convertible Debentures and the Company has the right not to honor any
request to convert, or exercise any Additional Warrants or New Warrants, which
in the aggregate would involve the issuance of a number of shares that would not
exceed 19.999% of the total number of shares of the Company's common stock
outstanding on the trading day prior to the date of the purchase
agreement.




In
connection with the issuance of the Convertible Debenture and the additional
investment right, the Company entered into a Registration Rights Agreement with
the Holders relating to the underlying securities. Based on the interpretive
guidance in EITF No. 05-4, view C, since the registration rights agreement
includes provisions for uncapped liquidated damages, the Company determined that
the registration rights is a derivative liability. However due to various
factors including substantial conversion of these Convertible Debentures and the
registration statement becoming effective in December 2005, the value of the
registration rights was deemed to be de minimis and therefore no liability was
recorded in the consolidated financial statements.




F-27


Note
12 - Convertible Debentures-continued





On July
5, 2006, the Company closed a Securities Purchase Agreement entered into on June
30, 2006 whereby it sold a non-redeemable $1,000,000 convertible term note, due
June 30, 2009, to Laurus Master Fund, Ltd. ("Laurus") and issued a 5 year
warrant for 160,000 shares of the Company’s common stock. The Company paid fees
of $49,000 to Laurus and received net proceeds of $951,000. The Company incurred
escrow fees of $1,500.   In conjunction with this issuance, the
Company agreed that within sixty (60) days from the date of issuance of the
convertible term note payable and warrant that it would file a registration
statement with the SEC covering the resale of the shares of the Company's
convertible term common stock issuable upon conversion of the note and the
exercise of the warrant. This registration statement would also cover any
additional shares of common stock issuable to Laurus as a result of any
adjustment to the fixed conversion price of the note or the exercise price of
the warrant.   The agreement does not provide any formula for
liquidated damages.  The Company did not file a registration statement
by August 29, 2006 covering the common stock issuable upon conversion of the
convertible term note and the
exercise of warrants issued to Laurus.  As of June 30, 2008, the
Company had yet to file that registration statement.  Consequently,
the Company is in breach of its registration obligations to Laurus although the
Company has not received any notice from Laurus regarding this registration
rights default and or the assessment of any penalties that might have resulted
therefrom.  The Company’s breach of its registration obligations
constitutes a default under the agreement, which enables the holders to declare
the convertible debentures immediately due and payable.  Therefore, as
of June 30, 2008, this debt is classified as short-term on the Company’s
consolidated balance sheet.




In
accordance with EITF 00-27 “Application of Issue #98-5 to Certain Convertible
Instruments” and EITF 98-5, "Accounting for Convertible Securities with
Beneficial Conversion Features or Contingently Adjusted Conversion Ratios", on a
relative fair value basis, the warrants were recorded at a value of $472,000.
The conversion feature, utilizing an effective conversion price and market price
of the common stock on the date of issuance of $3.00 and $7.70, per share,
respectively, was valued at $723,000, which was then limited to $528,000, the
remaining undiscounted value of the proceeds of the convertible term note.
Accordingly, the Company has recorded a debt discount related to the warrants of
$472,000 and a beneficial conversion feature of the convertible term note of
$528,000, which amounts are amortizable utilizing the interest method over the
three year term of the convertible term note. Amortization of debt discounts on
this convertible note payable amounted to approximately $271,000 and $330,000
for the years ended June 30, 2008 and 2007, respectively.




The note
is convertible at the option of Laurus into shares of the Company's common
stock, at an initial fixed conversion price of $6.50 per share.  The
conversion rate of the note is subject to certain adjustments and limitations as
set forth in the note.As of June 30, 2008
and 2007, the convertible debt principal outstanding on the Laurus note was
$805,556 and $1,000,000, respectively, which was then offset by an unamortized
debt discount of approximately $399,000 and $670,000 at June 30, 2008 and 2007,
respectively.




On August
8, 2006, the Company issued $2,000,000 of convertible debentures to certain
investors, due August 8, 2008 and issued 5 year non-redeemable warrants to
purchase 672,667 shares of the Company’s common stock. While no formal notice of
default has been received, the Company is currently negotiating to extend the
terms of this agreement.  In conjunction with this issuance, the
Company had agreed to file a registration statement within forty-five (45) days,
or by September 22, 2006, covering the resale of the shares of common stock
underlying the debentures and warrants issued to the investors, and by October
15, 2006, to have such registration statement declared effective.  The
registration rights agreement with the investors provides for partial liquidated
damages in the case that these registration requirements are not
met.    From the date of violation, the Company is obligated
topay liquidated
damages of 2% per month of the outstanding amount of the convertible debentures,
up to a total of 24% of the initial investment, or $0.5 million.  As
of June 30, 2008, the Company had not yet filed a registration statement
regarding these securities.   Accordingly, through June 30, 2008, the
Company incurred and recorded a liquidated damages obligation of $0.5 million,
none of which has been paid.    In addition, the Company is
obligated to pay 18% interest per annum on any damage amount not paid in full
within 7 (seven) days.  Through June 30, 2008, the Company has
incurred an interest obligation of approximately $0.1 million, none of which has
been paid.  The holders have not waived their rights under this
agreement.  Additionally, the Company’s breach of its registration
obligations constitutes a default under the agreement, which enables the holders
to declare the convertible debentures immediately due and
payable.  Therefore, as of June 30, 2008, this debt is classified as
short-term on the Company’s consolidated balance sheet.  The Company
has not received any notice from the purchasers of the convertible debentures
regarding this registration rights default or any other default
notice.





F-28





Note
12 - Convertible Debentures-continued





The
convertible debentures are convertible into shares of the Company's common stock
at a conversion price of $6.00 per share, which was the market value of the
Company's common stock on the date of issuance. The Company received net
proceeds of $1,820,000 and incurred expenses of legal fees of $40,000 and broker
fees of $140,000 in connection with this financing that were recorded as
deferred financing costs and amortized on a straight-line basis over the two
year term of the convertible debentures. The convertible debentures bear
interest at the greater of either LIBOR (2.46% as of June 30, 2008) plus 6.0%,
or 12.5%, per annum, and such interest is payable quarterly to the holder either
in cash or in additional convertible debentures at the Company’s
option.




At any
time, the holder may convert the convertible debenture into shares of common
stock at $6.00 per share, or into 333,333 shares of common stock, which
represents a conversion at the face value of the convertible
debenture.




On May
30, 2007, upon consummation by the Company of the business combination
transaction with Properties, the Company may redeem the convertible debentures
at a price of 120% of the face amount, plus any accrued but unpaid interest and
any unpaid liquidated damages or under certain conditions, the Company may
redeem the amount at 120% of the face amount in cash, or redeem through the
issuance of shares of common stock at the lower of the existing conversion price
or 90% of the volume weighted average price, as stipulated in the
agreement.




The
investors may elect to participate in up to 50% of any subsequent financing of
the Company by providing written notice of intention to the
Company.




The
investors also were issued 333,333, 166,667 and 172,667 five-year warrants to
purchase additional shares of the Company's common stock at $4.00, $6.00 and
$7.00 per share, respectively. These warrants were valued at $3,143,000 using
the Black-Scholes model, applying an interest rate of 4.85%, volatility of
98.4%, dividends of 0% and a term of five years. In accordance with EITF 00-27
and EITF 98-5, on a relative fair value basis, the warrants were recorded at a
value of $1,222,000. The beneficial conversion feature, utilizing an effective
conversion price and market price of the common stock on the date of issuance of
$2.00 and $6.00, per share, respectively, was valued at $1,333,000 which, was
then limited to $778,000, the remaining undiscounted value of the convertible
term note. Accordingly, the Company has recorded a debt discount related to the
warrants of $1,222,000, the beneficial conversion feature of the convertible
term note of $778,000, which amounts are amortizable over the two-year term of
the convertible debenture.  Amortization of debt discount on these
convertible debentures was approximately $883,000 and $893,000 for the years
ended June 30, 2008 and 2007, respectively. As of June 30, 2008 and 2007,
the convertible debt principal outstanding on this debt was $1,850,000 and
$2,000,000, respectively, which was then offset by an unamortized debt discount
of approximately $225,000 and $1,107,000 at June 30, 2008 and 2007,
respectively.




As of
June 30, 2008, the Company’s future debt discount to be amortized in 2009 was
$623,962.





Note
13 - Stockholders Equity





Stock-Based
Compensation




On
December 15, 2005, the Company entered into a consulting agreement, which
included the issuance of options to purchase 25,000 shares of the Company’s
common stock at an exercise price of $8.09, the market price on the date of the
agreement. The options were valued at $174,430 using the Black-Scholes
option-pricing model and were amortized over the initial 3-year life of the
consulting agreement.  Stock-based compensation was zero and $115,607
for the years ended June 30, 2008 and 2007, respectively, relating to this
agreement. The Company terminated this consulting agreement in December,
2006.




On March
10, 2006, the Company entered into a consulting arrangement for prior services
rendered, which included the issuance of options to purchase 75,000 shares of
the Company’s common stock at an exercise price of $7.13, the market price on
the effective date of the arrangement.  The options were valued at
$195,036 using the Black-Scholes option-pricing model and was recorded as
stock-based compensation immediately as the options were fully vested upon
grant. During the year ended June 30, 2007, the Company revalued these
options.  Stock based compensation related to the revaluation was
$8,236 for the year ended June 30, 2007.




F-29


Note
13 - Stockholders Equity-continued





Stock-Based
Compensation-continued




On July
31, 2006, an option was granted to Frank Nocito, a Vice President and
stockholder of the Company, to purchase 50,000 shares of common stock of the
Company at a price of $4.55 per share. Thereafter, in error, the Company issued
the shares to Mr. Nocito. Mr. Nocito had not formally exercised the option, nor
had he paid the Company the cash consideration for the shares. Mr. Nocito
returned the stock certificates to the Company and the shares were cancelled by
the transfer agent.  On October 7, 2006, Mr. Nocito and the Company
agreed to cancel the option and further, Mr. Nocito agreed in writing to waive
any and all rights that he had to the option. The option was then cancelled and
deemed null and void and the statements reflect no expense related to the
cancelled grant.




On August
25, 2006, Steven Vella, the Company's former Chief Financial Officer, elected to
exercise 12,500 options with an exercise price of $4.36 that were granted to him
on June 23, 2006, as part of a negotiated severance package. As a result of the
option exercise, the Company received proceeds of $54,500.  Black
Scholes variables used were 3 year term, risk free interest rate of 5.23% and
volatility of 86.9%.




On August
29, 2006, the stockholders approved an increase in the authorized shares of
common stock from 10.0 million shares to 75.0 million shares.




On June
29, 2007, the Company issued options to four outside members of its Board of
Directors to purchase an aggregate of 321,040 shares of the Company’s common
stock at an exercise price of $1.90, the market price on the day of
grant.  The options were valued at $439,825 using the Black-Scholes
option-pricing model and were fully vested and exercisable when
issued.   Black Scholes variables used were 5 year term, risk
free interest rate of 4.30% and volatility of 91%.




A summary
of the Company's stock option activity and related information for the years
ended June 30, 2007 and 2008 is as follows:




Number
      of Options
            
            
            Weighted
      Average Exercise PriceOutstanding
      June 30, 2006
            
            
            91,500
            
            
            $
            5.92Granted
            
            
            371,040
            
            
            
            2.26Exercised
            
            
            (12,500
            )
            
            
            4.36Forfeited
            
            
            (50,000
            )
            
            
            4.55Outstanding
      June 30, 2007
            
            
            400,040
            
            
            
            2.74Granted
            
            
            -
            
            
            
            -Exercised
            
            
            -
            
            
            
            -Forfeited
            
            
            -
            
            
            
            -Outstanding
      June 30, 2008
            
            
            400,040
            
            
            
            2.74





During
the years ended June 30, 2008 and 2007, zero options and 12,500 options were
exercised for proceeds of zero and $54,500 respectively.




F-30


Note
13 - Stockholders Equity-continued




Stock-Based
Compensation-continued




Options
exercisable are as follows:




Number
      of Options
            
            
            Weighted
      Average Exercise PriceJune
      30, 2007
            
            
            400,040
            
            
            $
            2.74June
      30, 2008
            
            400,040
            
            
            $
            2.74




The
weighted-average fair value of options granted during the year ended June 30,
2007 was $1.67.  There were no options granted in the year ended June
30, 2008.




The
following is a summary of stock options outstanding and exercisable at June 30,
2008 by exercise price range:





Exercise
      Price Range
            
            
            Number
      of Options
            
            
            Weighted-Average
      Remaining Contractual Life (Years)
            
            
            Weighted-Average
      Exercise Price
            
            
            Intrinsic
      Value$2.55
      - $ 4.36
            
            
            
            30,000
            
            
            
            0.5
            
            
            $
            2.86
            
            
            $
            101,675$8.09
      - $ 8.32
            
            
            
            49,000
            
            
            
            2.6
            
            
            
            8.20
            
            
            
            -$1.90
            
            
            
            321,040
            
            
            
            9.0
            
            
            
            1.90
            
            
            
            536,137Totals
            
            
            
            400,040
            
            
            
            7.6
            
            
            $
            2.74
            
            
            $
            637,812





Stock
Options





The
estimated weighted average fair values of the options at the date of grant using
the Black-Scholes option-pricing model as promulgated by SFAS 123 and the
related assumptions used to develop the estimates are as follows:




Years
      Ended2008
            
            2007
            
            
            2006Risk-free
      interest rate
            (a)
            
            
            4.3%
            
            
            
            4.3%Expected
      volatility
            (a)
            
            
            91.0%
            
            
            
            90.9%Dividend
      yield
            (a)
            
            
            -
            
            
            
            -Expected
      life
            (a)
            
            5
      years
            
            
            3.5
      years




Note:


(a)There were no
options granted in the year ended June 30, 2008.





The
weighted average fair value of options granted during the years ended June 30,
2007 was $2.74.




Equity
Plans




The Able
Energy, Inc.’s 1999 Employee Stock Option Plan, as amended, permits stock option
awards up to 700,000 shares of the Company's common stock to be granted to
directors, employees and consultants of the Company.  This plan states
that unless otherwise determined by the Board of Directors, an option shall be
exercisable for ten years after the date on which it was
granted.  Vesting terms are set by the Board of
Directors.  There are 84,250 options remaining available for issuance
under this plan at June 30, 2008.




F-31




Note
13 - Stockholders Equity-continued




Stock-Based
Compensation-continued




The Able
Energy, Inc. 2000 Employee Stock Purchase Plan, which was approved by the
stockholders on June 23, 2000, permits stock option awards up to 350,000 shares
of the Company's common stock to be granted to employees of the Company. There
are 350,000 shares remaining available for issuance under this plan at June 30,
2008.




The Able
Energy, Inc. 2000 Stock Bonus Plan, which was approved by the stockholders on
June 23, 2000, permits restricted stock awards up to 350,000 shares of the
Company's common stock to be granted to directors, employees and consultants of
the Company. There are 338,000 shares remaining available for issuance under
this plan at June 30, 2008.




The Able
Energy, Inc. 2005 Incentive Stock Plan, which was approved by the stockholders
on May 25, 2005, permits stock option, common stock, and restricted common stock
purchase offer awards of up to 1,000,000 shares of the Company's common stock to
be granted to directors, employees and consultants of the
Company.  There are 678,960 shares remaining available for issuance
under this plan at June 30, 2008.




Warrants




A summary
of the Company’s stock warrant activity, and related information for the years
ended June 30, 2007 and 2008 is as follows:




Number
      of Warrants
              
              
              Weighted
      Average Exercise PriceOutstanding
      June 30, 2006
              
              
              5,332,309
              
              
              $
              7.49Granted
              
              
              832,667
              
              
              
              5.32Exercised
              
              
              -
              
              
              
              -Outstanding
      June 30, 2007
              
              
              6,164,976
              
              
              
              7.20Granted
              
              
              25,000
              
              
              
              0.56Exercised
              
              
              -
              
              
              
              -Outstanding
      June 30, 2008
              
              
              6,189,976
              
              
              $
              7.17




During
the years ended June 30, 2008 and 2007, no warrants were exercised.




Preferred
Stock




The
Certificate of Incorporation authorizes the issuance of 10,000,000 shares of
preferred stock, $.001 par value per share, with designations, rights and
preferences determined from time to time by the Board of
Directors.  Accordingly, the Company’s Board of Directors is
empowered, without stockholder approval, to issue classes of Preferred Stock
with voting, liquidation, conversion or other rights.  To date, no
preferred stock has been issued.




F-32


Note
13 - Stockholders Equity-continued




Voluntary
NASDAQ Delisting




On
October 4, 2006, the Company announced its intention to voluntarily delist the
Company's common stock from the NASDAQ Capital Market, effective as of the start
of trading on October 13, 2006. The Company's common stock is currently quoted
on the Pink Sheets. The management of the Company has indicated that the Company
will seek to have its common stock quoted on the OTC Bulletin Board as soon as
it qualifies for listing following the filing of this June 30, 2008 Annual
Report on Form 10-K and the September 30, 2008 Quarterly Report on Form
10-Q.





Note
14 - Segment reporting





Since the
Company’s business combination with All American Plazas, Inc. on May 30, 2007,
the Company is engaged in two primary business activities, organized in two
reporting segments; the Oil Segment and the Travel Plaza Segment.  The
Company’s senior management manages the businesses and the expected long-term
financial performance of each segment.  The accounting policies of the
segments are the same as those described in Note 3 - Summary of Significant
Accounting Policies.  There are no intersegment sales for any of the
periods presented below.




The
Company’s Oil Segment, consisting of Able Oil, Able NY, Able Energy Terminal,
LLC and PriceEnergy, is engaged in the retail distribution of, and the provision
of services relating to, #2 home heating oil, propane gas, kerosene and diesel
fuels. In addition to selling liquid energy products, the Company offers
complete heating, ventilation and air conditioning (“HVAC”) installation and
repair and other services and also markets other petroleum products to
commercial customers, including on-road and off-road diesel fuel, gasoline and
lubricants.




F-33


Note
14 - Segment reporting – continued





The
Company’s Travel Plaza Segment, operated by of Plazas, is engaged in
the retail sale of food, merchandise, fuel, personal services, onsite and mobile
vehicle repair, services and maintenance to both the professional and leisure
driver through a current network of ten travel plazas, located in Pennsylvania,
New Jersey, New York and Virginia.




Year
      Ended June 30,2008
              
              
              2007RevenuesOil
      Segment:#2
      heating oil
              
              $
              54,677,747
              
              
              $
              51,848,720Gasoline,
      diesel fuel, kerosene, propane & other lubricants
              
              
              17,637,567
              
              
              
              19,508,552Equipment,
      sales & installation
              
              
              2,255,439
              
              
              
              2,712,048Total
      Oil Segment
              
              $
              74,570,753
              
              
              $
              74,069,320Travel
      Plaza Segment:Fuels
              
              $
              174,578,455
              
              
              $
              16,721,454Non-Fuels
              
              
              27,291,380
              
              
              
              2,850,774Total
      Travel Plaza Segment
              
              $
              201,869,835
              
              
              $
              19,572,228Total
      revenues
              
              $
              276,440,587
              
              
              $
              93,641,548Depreciation &
      amortizationOil
      Segment
              
              $
              754,263
              
              
              $
              692,754Travel
      Plaza Segment
              
              
              1,134,643
              
              
              
              47,449Total
      depreciation and amortization
              
              $
              1,888,906
              
              
              $
              740,203Interest
      ExpenseOil
      Segment
              
              $
              1,501,931
              
              
              $
              862,034Travel
      Plaza Segment
              
              
              712,024
              
              
              
              86,982Total
      interest expense
              
              $
              2,213,955
              
              
              $
              949,016Segment
      LossOil
      Segment
              
              $
              (4,381,058
              )
              
              $
              (6,019,591
              )Travel
      Plaza Segment
              
              
              (8,532,175
              )
              
              
              (612,712
              )Total
      segment loss
              
              $
              (12,913,233
              )
              
              $
              (6,632,303
              )InventoriesTotal
      Oil Segment
              
              $
              427,339
              
              
              $
              626,483Total
      Travel Plaza Segment
              
              
              2,296,976
              
              
              
              3,565,307Inventory
              
              $
              2,724,315
              
              
              $
              4,191,790GoodwillOil
      Segment
              
              $
              -
              
              
              $
              -Travel
      Plaza Segment
              
              
              11,046,179
              
              
              
              11,139,542Total
      goodwill
              
              $
              11,046,179
              
              
              $
              11,139,542All Other
      AssetsOil
      Segment
              
              
              10,259,230
              
              
              $
              11,176,463Travel
      Plaza Segment
              
              
              10,713,274
              
              
              
              21,654,301Total
      all other assets
              
              $
              20,972,504
              
              
              $
              32,830,764Total
      AssetsOil
      Segment
              
              $
              10,686,569
              
              
              $
              11,802,946Travel
      Plaza Segment
              
              
              24,056,429
              
              
              
              36,359,150Total
      assets
              
              $
              34,742,998
              
              
              $
              48,162,096




F-34




Note
14 - Segment reporting – continued





The
Company did not have any operations outside the United States of
America.  Accordingly, all revenues were generated from domestic
transactions, and the Company has no long-lived assets outside the United States
of America.





Note
15 - Franchising





The
Company has franchise agreements with two franchised businesses specializing in
residential and commercial sales of fuel oil, diesel fuel, gasoline, propane and
related services.  The Company provides training, operational support
and use of Company credit for the purchase of product, among other things, as
specified in the agreements.




The
Company signed its first franchise agreement in December 1998. As of June 30,
2008, there was one Able Energy franchise in operation, located in East
Stroudsburg, Pennsylvania.




On June
29, 2001, PriceEnergy.com Franchising, LLC signed its first franchise
agreement.  As of June 30, 2008, PriceEnergy.com Franchising, LLC has
one franchise in operation in Norwalk, Connecticut.




The
Company stopped actively selling franchises in March 2002 and has not sold any
franchises since that time.  Franchise fee revenues were zero and
$14,783 for the years ended June 30 2008 and 2007, respectively.





Note
16 - Income Taxes





Components
of the provision for income taxes associated with continuing operations are as
follows:





For
      the Years Ended June 30,2008
            
            
            2007Current:Federal
            
            $
            -
            
            
            $
            -State
            
            
            28,680
            
            
            
            28,82428,680
            
            
            
            28,824Deferred:Federal
            
            
            215,000
            
            
            
            -State
            
            
            32,000
            
            
            
            -247,000
            
            
            
            -$
            275,680
            
            
            $
            28,824





The
provision for (benefit from) income taxes associated with continuing operations
using the statutory federal tax rate as compared to the Company’s effective tax
rate is summarized as follows:





For
      the Years Ended June 30,2008
            
            
            2007Federal
      income taxes at statutory rate
            
            
            (34.0)%
            
            
            
            (34.0)%State
      income taxes, net of federal benefit
            
            
            (0.3)%
            
            
            
            (5.0
      )%Permanent
      differences
            
            
            10.0%
            
            
            
            9.6%Change
      in valuation allowance
            
            
            24.3
      %
            
            
            
            29.4
      %Other
            
            
            -
      %
            
            
            
            -
      %Effective
      income tax rate
            
            
            -
      %
            
            
            
            -
      %





F-35





Note
16 - Income Taxes-continued





Temporary
differences between the tax bases of assets and liabilities and their financial
reporting amounts that give rise to deferred tax assets and liabilities and
their approximate tax effects are as follows:





June
      30,2008
            
            
            2007Net
      operating loss carry forwards
            
            $
            9,663,224
            
            
            $
            5,642,722Allowance
      for doubtful accounts
            
            
            504,632
            
            
            
            293,365Stock-based
      compensation
            
            
            300,177
            
            
            
            294,000Deferred
      tax assets - gross
            
            
            10,468,033
            
            
            
            6,230,087Property
      and equipment
            
            
            (169,499
            )
            
            
            (194,718
            )Goodwill
            
            
            (247,000
            )
            
            
            (19,000
            )Deferred
      tax asset - net
            
            
            10,051,534
            
            
            
            6,016,369Less:
      Valuation allowance
            
            
            (10,051,534
            )
            
            
            (6,016,369
            )Total
            
            $
            -
            
            
            $
            -Increase
      (decrease) in valuation allowance
            
            $
            4,035,165
            
            
            $
            1,471,429





The
Company has federal net operating loss (“NOL”) carry forwards of approximately
$24,800,763 and $14,455,000 as of June 30, 2008 and 2007, respectively. The
federal NOL carry forwards expire between June 30, 2021 and
2028.  Able Energy, Inc, Able Oil Company and PriceEnergy.Com, Inc.
have aggregate New Jersey NOL carry forwards of approximately $24,619,313 and
$13,732,000 as of June 30, 2008 and 2007, respectively.  The New
Jersey net operating loss carry forwards expire between June 30, 2009 and
2015.  The federal and state NOL carry forwards at June 30, 2008 and
2007 include approximately $3,933,000 related to windfall tax deductions for
which a benefit will be recorded to additional paid-in capital when
realized.  The Company’s ability to use its federal NOL carry forwards
may be subject to an annual limitation in future years pursuant to Section 382
of the Internal Revenue Code (“IRC”).




These
carry forward losses are available to offset future taxable income, if
any.  The Company’s utilization of this carry forward against future
taxable income is subject to the Company having profitable operations or a
profitable sale of Company assets, which creates taxable income. Due to the
uncertainty surrounding the realization of the benefits associated with the
carry forward losses and the other temporary differences, the Company has
provided a valuation allowance for the entire amount of the net deferred tax
assets as of June 30, 2008 and 2007.





Note
17 - 401(k) Plan





Able Oil
Company, included in the Oil Segment, established a Qualified Profit Sharing
Plan under IRC Section 401(k).  The Able Oil Company is obligated to
match 25% of qualified employee contributions up to 6% of salary.  The
401(k) matching contribution expense was approximately $26,600 and $29,300 for
the years ended June 30, 2008 and 2007, respectively.




While the
Travel Plaza Segment’s 401(k) Savings Plan provides for matching contributions,
at managements discretion, no such matching contributions have been made since
the inception of the plan in 2005.





Note
18 - Related Party Transactions





PriceEnergy.com




At June
30, 2008, a total of four current officers, a former officer and a related party
of the Company own 32.7% of the common stock of the subsidiary, PriceEnergy.com,
which was incorporated in November 1999. The remaining shares of PriceEnergy.com
are held by the Company.




F-36


Note
18 - Related Party Transactions-continued




Acquisition
of Assets of Properties




At June
30, 2008, Properties owns approximately 84.7% of the Company’s outstanding
common stock.  Approximately 85.0% of the common stock of Properties
is owned by the Chelednik Family Trust, a trust established by Mr. Nocito, an
officer of the Company and his wife for the benefit of their
family.   The balance of the outstanding common stock of
Properties is owned by a limited liability company owned by Gregory D. Frost,
the Chief Executive Officer and Chairman of the Board of the Company, and his
wife.




The
Company entered into a Stock Purchase Agreement on June 16, 2005 with  All
American Plazas, Inc. now known as All American Properties, Inc. (“Properties”)
(which was subsequently amended and restated into the Asset Purchase Agreement
as of the same date) ("Purchase Agreement") with Properties in connection with
the Company’s acquisition of the assets of Properties. This transaction was
approved on August 29, 2006 at a special meeting of the Company’s
stockholders.  The closing occurred on May 30, 2007.  Under
the terms of the Purchase Agreement, the Company delivered to the Sellers
11,666,667 shares of the Company’s restricted common stock, par value $.001 per
share, at $1.65 per share for an aggregate purchase price of approximately $19.3
million.




The
Company also acquired a ten-year option to acquire any of the travel plaza real
estate owned by Properties, providing that the Company assume all existing debt
obligations related to the applicable properties.  The option has been
valued at $5.0 million and is exercisable as long as the leases of the Company's
subsidiary, All American Plazas, Inc. (“Plazas”), relating to the
applicable real estate remain in effect.  Plazas’ leases automatically
renew, upon the mutual consent of Plazas and Properties, for consecutive
one-year terms so that the total term of each lease shall be for a period of ten
years.




Properties
Financing




On July
5, 2006, the Company received $1,000,000 from Laurus in connection with the
issuance of a convertible term note.  Of the proceeds received from
Laurus in connection with the issuance of the convertible term note, the Company
loaned $905,000 to Properties in exchange for a note
receivable.  Properties used such proceeds to pay (i) certain
obligations of CCIG Group, Inc. (“CCIG”) and its wholly-owner subsidiary, Beach
Properties Barbuda Limited (“BPBL”), which owned and operated an exclusive
Caribbean resort hotel known as the Beach House located on the island of
Barbuda, and (ii) a loan obligation owed by BPBL to Laurus which loan was used
by CCIG to acquire the Beach house.  Properties had previously
acquired a 70% interest in CCIG pursuant to a Share Exchange
Agreement.  The Company received from Laurus a notice of a claim of
default dated January 10, 2007.  Laurus claimed default under section
4.1(a) of the Term Note as a result of non-payment of interest and fees in the
amount of $8,826 that was due on January 5, 2007, and a default under sections
6.17 and 6.18 of the securities purchase agreement for “failure to use best
efforts (i) to cause CCIG to provide Holder on an ongoing basis with evidence
that any and all obligations in respect of accounts payable of the project
operated by CCIG’s subsidiary, BPBL, have been met; and (ii) cause CCIG to
provide within 15 days after the end of each calendar month, unaudited/internal
financial statements (balance sheet, statements of income and cash flow) of the
Beach House and evidence that BPBL and the Beach House are current in all of
their ongoing operational needs”.




The
aforementioned interest and fees were paid by the Company on January 11, 2007.
Further, the Company has used its best efforts to cause CCIG to provide reports
and information to Laurus as provided for in the securities purchase
agreement.




In
connection with the claim of default, Laurus claimed an acceleration of maturity
of the principal amount of the Note of $1,000,000 and approximately $154,000 in
default payment (“Default Payment”) as well as accrued interest and fees of
approximately $12,000. On March 7, 2007, Laurus notified the Company that it
waived the event of default and that Laurus had waived the requirement for the
Company to make the Default Payment.




F-37


Note
18 - Related Party Transactions-continued




Properties
Financing-continued




In
consideration for the loan, Properties granted the Company an option, (the
“Option") exercisable in the Company's sole discretion, to acquire 80% of the
CCIG stock Properties acquired from CCIG pursuant to a Share Exchange Agreement.
In addition, in the event that the Company exercises the Option, 80% of the
outstanding principal amount of the Properties note will be cancelled and shall
be deemed fully paid and satisfied. The remaining principal balance of the
Properties note and all outstanding and accrued interest on the loan shall be
due and payable one year from the exercise of the Option. The Option must be
exercised in whole and not in part and the Option expires on July 5, 2008. The
Company did not exercise the Option prior to its expiration.  In the
event the Company does not exercise the Option, the Properties note shall be due
in two years, on July 6, 2008, unless the Company has issued a declaration of
intent not to exercise the Option, in which case the Properties note shall be
due one year from such
declaration. The Company has determined, that given the lack of liquidity in the
shares of CCIG and the lack of information in regard to the financial condition
of CCIG that this option has no value and has not been recorded by the
Company.




The
Company loaned Properties $1,730,000 as evidenced by a promissory note dated
July 27, 2005 with a maturity date of June 15, 2007. Subsequent to an extension
of the maturity date of the note, this note and related interest receivable was
paid in -full as of June 30, 2008.    The interest income
related to this note for the years ended June 30, 2008 and 2007 was $152,721 and
$164,350, respectively.  The note and accrued interest receivable in
the amount of $1,964,925 were classified as contra-equity on the Company’s
consolidated balance sheet as of June 30, 2007.




During
December 2006, the Company entered into a Fuel Purchase agreement with
Properties. Under the agreement, the Company pre-paid $350,000 to Properties in
exchange for fuel purchased pursuant to this agreement to be provided by
Properties at a $.05 per gallon discount from the Newark, New Jersey daily spot
market price. Properties satisfied $338,942 of its obligations under this
agreement as of June 30, 2007 and the balance of $11,058 was satisfied as of
June 30, 2008.  The prepaid balance under the agreement at June 30,
2007 was $11,058 and was included as a receivable from a related party in the
consolidated balance sheet at June 30, 2007.




The
Company receives rent from Properties for office space occupied by Properties in
the Company’s New York City offices.  The Company has reduced gross
rent expense included in sales, general and administrative expenses in the
consolidated statements of operations in the amount of $114,041 and $110,615 for
the years ended June 30, 2008 and 2007, respectively.




On June
1, 2005, Properties completed a financing that may impact the Company. Pursuant
to the terms of the Securities Purchase Agreement (the "Agreement") among
Properties and certain purchasers (“Purchasers”), the Purchasers loaned
Properties an aggregate of $5,000,000, evidenced by Secured Debentures dated
June 1, 2005 (the "Debentures").  The Debentures were due and payable
on June 1, 2007, subject to the occurrence of an event of default, with interest
payable at the rate per annum equal to LIBOR for the applicable interest period,
plus 4% payable on a quarterly basis on April 1st, July
1st,
October 1st and
January 1st,
beginning on the first such date after the date of issuance of the
Debentures.  Upon the May 30, 2007 completion of the business
combination  with Properties and the Company’s board approving the
transfer of the debt that would also require the transfer of additional assets
from Properties as consideration for the Company to assume this debt, then the
Debentures are convertible into shares of our common stock at a conversion rate
of the lesser of (i) the purchase price paid by us for issuance of our
restricted common stock for the assets of All American upon completion of the
business combination, or (ii) $3.00, subject to further adjustment as set forth
in the agreement.




The loan
is secured by real estate property owned by Properties in Pennsylvania and New
Hampshire.  Pursuant to the Additional Investment Right (the “AIR
Agreement”) among Properties and the Purchasers, the Purchasers may loan
Properties up to an additional $5,000,000 of secured convertible debentures on
the same terms and conditions as the initial $5,000,000 loan, except that the
conversion price will be $4.00.  Pursuant to the Agreement, these
Debentures are in default, as Properties did not complete the business
combination with the Company prior to the expiration of the 12-month anniversary
of the Agreement.





F-38





Note
18 - Related Party Transactions-continued





Properties
Financing-continued





Subsequent
to the consummation of the business combination, we may assume the obligations
of Properties under the Agreement.  However, the Company’s board of
directors must approve the assumption of this debt, which requires that
Properties transfer additional assets or consideration for such assumption of
debt.  Based upon these criteria, it is highly unlikely the Company
will assume the obligations of Properties, including the Debentures and the AIR
Agreement, through the execution of a Securities Assumption, Amendment and
Issuance Agreement, Registration Rights Agreement, Common Stock Purchase Warrant
Agreement and Variable Rate Secured Convertible Debenture Agreement, each
between the Purchasers and us (the “Able Energy Transaction
Documents”).  Such documents provide that Properties shall cause the
real estate collateral to continue to secure the loan, until the earlier of full
repayment of the loan upon expiration of the Debentures or conversion by the
purchasers of the Debentures into shares of our common stock at a conversion
rate of the lesser of (i) the purchase price paid by us for each share of AAP
common stock in the acquisition, or (ii) $3.00, (the “Conversion Price”),
subject to further adjustment as set forth in the Able Energy Transaction
Documents.  However, the Conversion Price with respect to the AIR
Agreement shall be $4.00.  In addition, the Purchasers shall have the
right to receive five-year warrants to purchase 2,500,000 of our common stock at
an exercise price of $3.75 per share.  Pursuant to the Able Energy
Transaction Documents, we also have an optional redemption right (which right
shall be mandatory upon the occurrence of an event of default) to repurchase all
of the Debentures for 125% of the face amount of the Debentures plus all accrued
and outstanding interest, as well as a right to repurchase all of the Debentures
in the event of the consummation of a new financing in which we sell securities
at a purchase price that is below the Conversion Price.  The
stockholders of Properties have agreed to escrow a sufficient number of shares
to satisfy the conversion of the $5,000,000 in outstanding Debentures in
full.




During
June 2007, the Company paid $8.4 million of fuel invoices on behalf of
Properties to TransMontaigne Product Services, Inc.,
(“TransMontaigne”).  This advance was reflected in current assets at
June 30, 2007.  As a result of an October, 2007 series of transactions
involving Properties, Plazas and TransMontaigne, these amounts were offset and
Plazas executed a $1.6 million note payable to TransMontaigne for advance
amounts under the fuel supply agreement for Plazas.




Manns
Haggerskjold of North America, Ltd. (“Manns”) Agreement




On May
19, 2006, the Company entered into a letter of interest agreement with Manns,
for a bridge loan to the Company in the amount of $35,000,000 and a possible
loan in the amount of $100 million based upon the business combination with
Properties ("Manns Agreement"). The terms of the letter of interest provided for
the payment of a commitment fee of $750,000, which was non-refundable to cover
the due-diligence cost incurred by Manns. On June 23, 2006, the Company advanced
to Manns $125,000 toward the Manns Agreement due diligence fee. During the
period from July 7, 2006 through November 17, 2006, the Company advanced an
additional $590,000 toward the Manns Agreement due diligence fee. The amount
outstanding relating to these advances as of June 30, 2007 was
$715,000.  As a result of not obtaining the financing (see below), the
entire $715,000 was expensed to amortization of deferred financing costs in the
year ended June 30, 2007.




As a
result of the Company receiving a Formal Order from the SEC on September 22,
2006, the Company and Manns agreed that the commitment to fund being sought
under the Manns Agreement would be issued to Properties, since the Company’s
stockholders had approved a business combination with Properties and since the
collateral for the financing by Manns would be collateralized by real estate
owned by Properties. Accordingly, on September 22, 2006, Properties agreed that
in the event Manns funds a credit facility to Properties rather than the
Company, upon such funds being received by Properties, it will immediately
reimburse the Company for all expenses incurred and all fees paid to Manns in
connection with the proposed credit facility from Manns to the
Company.  On or about February 2, 2007, Properties received a term
sheet from UBS Real Estate Investments, Inc. (“UBS”) requested by Manns as
co-lender to Properties. Properties rejected the UBS offer as not consistent
with the Manns’ commitment of September 14, 2006. Properties subsequently
demanded that Manns refund all fees paid to Manns by Able and Properties. In
order to enforce its rights in this regard, Properties has retained legal
counsel and commenced an arbitration proceeding against Manns and its
principals. The Company and Properties intend to pursue their remedies against
Manns. All recoveries and fees and costs of the litigation will be allocated
between the Company and Properties in proportion to the amount of the Manns due
diligence fees paid. See Item
3, Legal Proceedings.




F-39


Note
18 - Related Party Transactions-continued




Note
Receivable-Related Parties




In
connection with two loans entered into by the Company in May 2005, fees in the
amount of $167,500 were paid to Unison Capital Corporation (“Unison”), a company
controlled by Mr. Nocito, an officer of the Company. This individual also has a
related-party interest in Properties.  Subsequent to the payments
being made and based on discussions with Unison, it was determined the $167,500
was an inappropriate payment and Unison agreed to reimburse this amount to the
Company over a twelve month period beginning in October 2005. As of June 30,
2008 the note and interest due was paid in full.  The Company received
interest in the amount of $5,865 for the year ended June 30, 2008.




Subsequent
to June 30, 2007, related party receivables from Properties were reduced by
approximately $2.2 million, net.  This reduction occurred from offsets
of rent owed to Properties by the Company’s wholly-owned subsidiary, Plazas, in
connection with its leasing of the real property underlying the truck stops
operated from July 2007 through June 2008 in the amount of approximately $1.1
million, and from cash payments made by Properties in the amount of $1.5 million
resulting from refinancing and settlements by Properties in December, 2007,
January, 2008 and March, 2008.




Notes
and Loans Receivable Related Parties
 Years Ending June 30, 2007 and
2008


Beginning
      Balance
            
            
            Additions
            
            
            Payments
            
            
            Adjustments
            
            
            Ending
      Balance2007Notes
      Receivable-Properties
            
            $
            1,730,000
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            1,730,000Interest
      Receivable-Properties
            
            
            70,575
            
            
            
            164,350
            
            
            
            -
            
            
            
            -
            
            
            
            234,925Notes
      Receivable-Unison Capital
            
            
            167,500
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            167,500Interest
      Receivable Unison Note
            
            
            11,730
            
            
            
            10,050
            
            
            
            -
            
            
            
            -
            
            
            
            21,780Laurus
      Notes Receivable-Properties
            
            
            -
            
            
            
            905,000
            
            
            
            
            
            
            
            
            
            
            
            905,000Interest
      Receivable- Laurus Note
            
            
            -
            
            
            
            102,784
            
            
            
            (94,242
            )
            
            
            -
            
            
            
            8,542Fuel
      Supply Contract-Properties
            
            
            -
            
            
            
            361,058
            
            
            
            (350,000
            )
            
            
            -
            
            
            
            11,058Manns
      Agreement-Properties
            
            
            125,000
            
            
            
            590,000
            
            
            
            -
            
            
            
            (715,000
            )
            
            
            -New
      York Office Rent-Properties
            
            
            -
            
            
            
            110,615
            
            
            
            (36,221
            )
            
            
            -
            
            
            
            74,394Total
            
            $
            2,104,805
            
            
            $
            2,243,857
            
            
            $
            (480,463
            )
            
            $
            (715,000
            )
            
            $
            3,153,1982008Notes
      Receivable-Properties
            
            $
            1,730,000
            
            
            $
            -
            
            
            $
            (1,730,000
            )
            
            $
            -
            
            
            $
            -Interest
      Receivable-Properties
            
            
            234,925
            
            
            
            152,721
            
            
            
            (387,646
            )
            
            
            -
            
            
            
            -Notes
      Receivable-Unison Capital
            
            
            167,500
            
            
            
            -
            
            
            
            (167,500
            )
            
            
            -
            
            
            
            -Interest
      Receivable Unison Note
            
            
            21,780
            
            
            
            5,865
            
            
            
            (27,645
            )
            
            
            -
            
            
            
            -Laurus
      Notes Receivable-Properties
            
            
            905,000
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            905,000Interest
      Receivable- Laurus Note
            
            
            8,542
            
            
            
            77,353
            
            
            
            (85,895
            )
            
            
            -
            
            
            
            -Fuel
      Supply Contract-Properties
            
            
            11,058
            
            
            
            -
            
            
            
            (11,058
            )
            
            
            -
            
            
            
            -New
      York Office Rent-Properties
            
            
            74,394
            
            
            
            114,041
            
            
            
            (188,435
            )
            
            
            -
            
            
            
            -Total
            
            $
            3,153,198
            
            
            $
            349,980
            
            
            $
            (2,598,178
            )
            
            $
            -
            
            
            $
            905,000




F-40




Note
18 - Related Party Transactions-continued




Consulting
Agreements




The
Company entered into a consulting agreement with its former CEO, Timothy
Harrington, on February 16, 2005. The agreement was for two years and provided
for annual fees of $60,000 to be paid in monthly installments.




In
addition, the former CEO received options, which were fully vested upon grant,
to purchase 100,000 shares of the Company's common stock at $4.00 per share. The
options were exercised on July 7, 2005. The former CEO was paid $40,000 related
to this agreement during the year ended June 30, 2007.




On August
27, 2007 the Company entered into a service agreement with Axis Consulting
Services, LLC. The agreement calls for Axis Consulting to develop marketing plan
(phase 1) and manage (phase 2) “The Energy Store” (an e-commerce retail sales
portal for energy products and services). During phase 1, the terms are $2,750
per month and once phase 2 commences an amount of $5,600 per month. This
agreement ends on December 31, 2008.  Axis Consulting’s President (Joe
Nocito) has a direct relationship as the son of the Company’s Executive
Vice-President Frank Nocito.




Change
in Officers Status




On
September 28, 2006, Gregory Frost, gave notice to the Board of Directors that he
was taking an indefinite leave of absence as Chief Executive Officer of the
Company and resigned as Chairman of the Board.  Mr. Christopher P.
Westad, the acting Chief Financial Officer of the Company, was designated by the
Board to serve as acting Chief Executive Officer. In connection with Mr.
Westad's service as acting Chief Executive Officer, Mr. Westad stepped down,
temporarily, as acting Chief Financial Officer. The Board designated Jeffrey S.
Feld, the Company's Controller, as the acting Chief Financial Officer. Mr. Feld
has been with the Company since September 1999.  Mr. Frost resumed his
duties as Chief Executive Officer effective May 24, 2007.  Mr. Westad
remained the President of the Company and Mr. Feld continued in his role as
acting Chief Financial Officer.




On
September 24, 2007, the Company’s Board of Directors appointed (i) Richard A.
Mitstifer, the former President of  Properties as President of the
Company; (ii) William Roger Roberts, the former Chief Operating Officer of
Properties, as the Company’s Chief Operating Officer; (iii) Daniel L. Johnston,
the former Controller of Properties, as Chief Financial Officer of the Company;
and (iv) Louis Aponte, the President of All American Industries, Inc. and all
American Realty and Construction Corp., which are affiliates
of  Properties specializing in real estate development and
construction, as the Company’s Vice-President of Special Projects. The Board
also promoted Frank Nocito, the Company’s Vice-President of Business
Development, to Executive Vice-President and expanded his duties to include
heading the Company’s expansion into alternative and clean energy fuels and
products. Mr. Nocito is the controlling person of the Cheldnick Family Trust,
the largest shareholder of Properties which, in turn, is the largest shareholder
of the Company. Messrs. Mitstifer, Roberts and Aponte were officers of
Properties in June 2005 when the Company entered into an asset purchase
agreement with Properties, pursuant to which the Company agreed to acquire
substantially all of Properties’ assets and assume all liabilities of Properties
other than mortgage debt liabilities. They were also officers of Properties at
the time the transaction closed in May 2007. Effective September 24, 2007,
Christopher P. Westad stepped down as President of the Company and Jeffrey Feld
stepped down as Acting Chief Financial Officer of the Company. The Board
subsequently appointed Mr. Westad as the President of the Company’s home heating
Oil Segment subsidiaries, Able Oil, Inc., Able Energy New York, Inc. and Able
Oil Melbourne, Inc.




F-41


Note
19 - Commitments and Contingencies




Employment
Agreements




On July
1, 2004, the Company entered into a three-year employment agreement with
Christopher Westad, the President of the Company’s home heating Oil Segment
subsidiaries, Able Oil, Inc., Able Energy New York, Inc. and Able Oil Melbourne,
Inc.  Pursuant to the agreement, he will be compensated at an annual
salary of $141,600 and will be eligible for an annual bonus and stock option
grants, which will be separately determined by the Compensation Committee of the
Board of Directors.  The term of the agreement may be extended by
mutual consent of the Company and Mr. Westad, and the annual salary is subject
to periodic increases at the discretion of the Board of Directors.  On
November 26, 2006, the Compensation Committee of the Board of Directors renewed
Mr. Westad’s employment agreement for a period of three years until November 25,
2009.  As of June 30, 2008, the total commitment under this employment
agreement was $283,200.




On July
1, 2004, the Company entered into a three-year employment agreement with John
Vrabel, the President of PriceEnergy.com, Inc. Pursuant to the agreement, he
will be compensated at an annual salary of $141,600 and will be eligible for an
annual bonus and stock option grants, which will be separately determined by the
Compensation Committee of the Board of Directors.  The term of the
agreement may be extended by mutual consent of the Company and Mr. Vrabel, and
the annual salary is subject to periodic increases at the discretion of the
Board of Directors.  While the term of the employment agreement was
allowed to expire on July 1, 2007, Mr. Vrabel remains an employee of the
Company.




On
October 12, 2005, the Company entered into a one-year employment agreement with
Gregory Frost, the Company’s CEO (who was on a paid leave of absence from
September 28, 2006 through May 23, 2007). Pursuant to the agreement, he was
compensated at an annual salary of $250,000 and will be eligible for an annual
bonus and stock option grants, which will be separately determined by the
Compensation Committee of the Board of Directors.  Pursuant to the
agreement, the employment with Mr. Frost was automatically renewed through
October 11, 2009.  As of June 30, 2008, the total commitment under
this employment agreement was approximately $323,000.




Engagement
of Consultant




On
January 11, 2008, the Company executed a consulting agreement with Hammond
Associates, LLC to provide consulting services in connection with satisfying the
Company’s SEC reporting requirements.  On April 30, 2008, the Company
issued 14,442 restricted shares of its common stock, $0.001 par value, at $0.56
per share as partial consideration for services provided by the
consultant.  The Company recorded consulting expense of $8,088 related
to this share issuance in the year ended June 30, 2008.  On April 16,
2008, the Company also issued Hammond Associates, LLC a five-year warrant to
purchase 25,000 shares at $0.56 per share as partial consideration for services
provided by the consultant.  Using the Black Scholes valuation model,
the Company valued the Company’s common stock underlying the warrant at $0.31
per share and recorded additional consulting expense of $7,750 relating to the
issuance of the warrant.




Operating
Leases




The
Company is obligated under certain property and equipment non-cancelable
operating lease agreements.  The rental properties include a lease of
the Company’s headquarters in Rockaway, New Jersey, office space in New York
City, office space in Easton, Pennsylvania and eleven full service travel plaza
facilities located in Pennsylvania, New York, New Jersey and Virginia. These
leases currently expire at various dates through May, 2010 but automatically
renew for consecutive one-year terms so that the total term of each lease shall
be for a period of ten years.  Rent expense was $7,357,798 and
$881,829 for the years ended June 30, 2008 and 2007, respectively. Future
minimum payments due under these leases are as follows:





For
      the Year Ending June 30,
            
            Amount2009
            
            $
            7,177,1092010
            
            
            2,010,000Total
      minimum lease payments
            
            $
            9,187,109




F-42




Note
19 - Commitments and Contingencies





Purchase
Commitments




The
Company’s Oil Segment is obligated to purchase #2 heating oil under various
contracts with its suppliers. As of June 30, 2008 total open commitments under
these contracts are approximately $0.3 million and expire on various dates
through the end of July 2008.  The Company’s Travel Plaza Segment has
no open commitments for purchases.




Major
Vendors




The
Company’s Oil Segment purchases fuel supplies on the spot market. During the
year ended June 30, 2008, the Oil Segment satisfied its inventory requirements
through eleven different suppliers, the majority of which have significant
domestic fuel sources, and many of which have been suppliers to us for over
seven years.




The
Company’s Travel Plaza Segment is also subject to spot market pricing and its
fluctuations.  It utilizes three major suppliers for its fuel source
needs.




Litigation




Following
an explosion and fire that occurred at the Company's facility in Newton, New
Jersey on March 14, 2003, and through the subsequent clean up efforts, the
Company has cooperated fully with all local, state and federal agencies in their
investigations into the cause of this accident (See Note 16).  A
lawsuit (known as Hicks vs. Able Energy, Inc.) was filed against the Company by
residents who allegedly suffered property damages as a result of the March 14,
2003 explosion and fire. The Company's insurance carrier is defending the
Company as it related to compensatory
damages. The Company has retained separate legal counsel to defend the Company
against the punitive damage claims. On June 13, 2005, the Court granted a motion
certifying a plaintiff class action which is defined as "All Persons and
Entities that on and after March 14, 2003, residing within a 1,000 yard radius
of Able Oil Company's fuel depot facility and were damaged as a result of the
March 14, 2003 explosion".  The Company sought and received Court
permission to serve interrogatories to all class members and in November 2007
answers to interrogatories were received by less than 125 families and less than
15 businesses. The Company successfully moved to exclude any and all persons and
entities form the class that did not previously provide answers to
interrogatories. The class certification is limited to economic loss and
specifically excludes claims for personal injury from the Class Certification.
The Company believes that the Class claims for compensatory damages are within
the available limits of its insurance. On September 13, 2006, the plaintiff’s
counsel made a settlement demand of $10,000,000, which the Company believes to
be excessive and the methodology upon which is fundamentally flawed. On May 7,
2008, this matter entered mediation. Mediation has not been successful, but the
Company remains open to reasonable settlement discussions with the plaintiffs.
The Company intends to vigorously defend the claim.




In
addition to the class action, seven property owners, who were unable to reach
satisfactory settlements with the Company’s insurance carrier, filed lawsuits
for alleged property damages suffered as a result of the March 14, 2003
explosion and fire. Subsequently, the Company’s insurance carrier has entered
into settlement agreements with four of the property owners.  The
Company's insurance carrier is defending the Company as it related to the
remaining three property damage claims. The Company’s counsel is defending
punitive damage claims. The Company believes that compensatory damage claims are
within the available limits of insurance and reserves for losses have been
established, as deemed appropriate, by the insurance carrier. There were a total
of 227 claims filed against the Company for property damages and 224 claims have
been settled by the Company’s insurance carrier resulting in the remaining three
lawsuits as described in this paragraph. The Company believes the remaining
three unsettled lawsuits will not have a material adverse effect on the
Company’s consolidated financial condition or operations.




On June
26, 2007, the Company and its affiliate, Properties (together with the Company
the “Claimants”), filed a Demand for Arbitration and Statement of Claim in the
Denver, Colorado office of the American Arbitration Association against Manns
Haggerskjold of North America, Ltd. (“Manns”), Scott Smith and Shannon Coe
(collectively the “Respondents”), Arbitration Case No. 77 148 Y 00236 07 MAV.
The Statement of Claim filed seeks to recover fees of $1.2 million paid to Manns
to obtain financing for the Company and Properties. The Claimants commenced the
Arbitration proceeding based upon the Respondents breach of the September 14,
2006 Commitment letter from Manns to Plazas that required Manns to loan Plazas
$150 million. The Statement of Claim sets forth claims for breach of contract,
fraud and misrepresentation and lender liability. On July 23, 2007,




F-43




Note
19 - Commitments and Contingencies-continued




Litigation
– continued





Respondents
filed their answer to the Statement of Claim substantially denying the
allegations asserted therein and interposing counterclaims setting forth claims
against the Company for breach of the Non-Circumvention Clause, breach of the
Exclusivity Clause and unpaid expenses. Respondents also assert counterclaims
for fraudulent misrepresentation and unjust enrichment. On Respondents’
counterclaim for breach of the Non-Circumvention Clause, Respondents claim
damages of $6,402,500. On their counterclaim for breach of the Exclusivity
Clause, Respondents claim damages of $3,693,750, plus an unspecified amount
related to fees on loans exceeding $2,000,000 closed by Properties or the
Company over the next five years. Respondents do not specify damages relative to
their other counterclaims.





On August
7, 2007, the Claimants filed their reply to counterclaims denying all of
Respondents material allegations therein. Respondents’ counterclaims were based
on the false statement that the Claimants had, in fact, received the financing
agreed to be provided by Manns from a third party.  The Respondents
subsequently withdrew all of their counterclaims.




The
parties have selected an Arbitrator and are presently engaged in
discovery.  The parties have exchanged documents and the depositions
of the parties have commenced and are scheduled to be concluded by the end of
November, 2008.  The hearing of the parties’ claims is scheduled to
commence before the Arbitrator on December 8, 2008.




Subsequent
to their dismissal on August 13, 2007, on October 10, 2007, on October 1, 2007,
the Company and its Chief Executive Officer (“CEO”) filed an action in New York
state court against Marcum & Kliegman, LLP (the Company’s former auditors)
and several of its partners for numerous claims, including breach of contract,
gross negligence and defamation.  The Company and its CEO are seeking
compensatory damages in the amount of at least $1 million and punitive damages
of at least $20 million. The claims asserted by the Company and its CEO arise
out of Marcum & Kliegman’s conduct with respect to the preparation and
filing of the Company’s SEC Reports.  On November 26, 2007, Marcum
& Kliegman and its partners filed a motion to dismiss the complaint on the
ground that it fails to state a claim for relief as a matter of
law.  On May 5, 2008, the Court issued a written decision and order
sustaining the Company’s claims against Marcum & Kliegman for breach of
contract and defamation, but dismissed the Company’s claims for negligence,
gross negligence, breach of fiduciary duty and breach of covenant of good faith
and fair dealing against Marcum & Kliegman and the defamation claim against
the individual defendants.  Both the Company and Marcum & Kliegman
have filed appeals from the decision and order.  Discovery proceedings
have commenced and the Company intends to vigorously prosecute this
action.




On
January 7, 2008, the Company, its Chief Executive Officer, Gregory D. Frost, and
its Vice-President of Business Development, Frank Nocito, were served with a
summons and complaint in a purported class action complaint filed in the United
States District Court, District of New Jersey. This action, which seeks class
certification, was brought by shareholders of CCI Group, Inc. (“CCIG”). The
complaint relates to a Share Exchange Agreement (the “Share Exchange
Agreement”), dated July 7, 2006, between Properties and CCIG, pursuant to which
seventy percent (70%) of the outstanding and issued shares of CCIG were
exchanged for 618,557 shares of the Company’s common stock which were owned by
Properties of which 250,378 shares were to be distributed to the shareholders of
CCIG and the balance of the shares were to be used to pay debts of
CCIG.  Neither the Company nor Messrs. Frost or Nocito were parties to
the Share Exchange Agreement. Properties remain the largest shareholder of the
Company. The Share Exchange Agreement was previously disclosed by the Company in
its Current Report on Form 8-K filed with the SEC on July 7, 2006 as part of a
disclosure of a loan by the Company to Properties.




Each of
the Company and Messrs. Frost and Nocito believes it/he has defenses against the
alleged claims and intends to vigorously defend itself/himself against this
action and have filed a motion to dismiss the compliant.  The motion
has been fully briefed and submitted to the Court.  As of the date of
this Report, no decision has been issued with respect to the
motion.




Management
believes it has adequate insurance coverage to cover material legal settlements,
if any, and material litigation expenses.  Management does not believe
that legal accruals are required at June 30, 2008, and none have been
recorded.  The Company has been involved in non-material lawsuits in
the normal course of business. These matters are handled by the Company’s
insurance carrier.  The Company believes that the outcome of the above
mentioned legal matters will not have a material effect on the Company’s
consolidated financial statements.




F-44


Note
19 - Commitments and Contingencies-continued




Changes
in Registrant's Certifying Accountant




On August
13, 2007, the Company dismissed Marcum & Kliegman, LLP as its independent
registered public accounting firm. The report of Marcum & Kliegman, LLP on
the Company's financial statements for the fiscal year ended June 30, 2006 (“FY
2006”) was modified as to uncertainty regarding (1) the Company’s ability to
continue as a going concern as a result of, among other factors, a working
capital deficiency as of June 30, 2006 and possible failure to meet its short
and long-term liquidity needs, and (2) the impact on the Company’s financial
statements as a result of a pending investigation by the SEC of possible federal
securities law violations with respect to the offer, purchase and sale of the
Company’s securities and the Company’s disclosures or failures to disclose
material information.




The
Company’s Audit Committee unanimously recommended and approved the decision to
change independent registered public accounting firms.




In
connection with the audit of the Company’s financial statements for FY 2006, and
through August 13, 2007, there have been no disagreements with Marcum &
Kliegman, LLP on any matter of accounting principles or practices, financial
statement disclosure or auditing scope or procedure, which disagreements, if not
resolved to the satisfaction of Marcum & Kliegman, LLP would have caused it
to make reference to the subject matter of such disagreements in connection with
its audit report. There were no reportable events as defined in Item
304(a)(1)(v) of Regulation S-K. On August 24, 2007, Marcum & Kliegman, LLP
sent a responsive letter to the Current Report on Form 8-K dated August 13,
2007, filed by the Company, which discussed the Company’s termination of Marcum
and Kliegman, LLP as its auditors. This responsive letter claimed that there
were two reportable events.  The Company filed an amended Form 8-K
Report acknowledging one reportable event that Marcum and Kliegman, LLP had
advised the Company of material weaknesses in the Company’s internal controls
over financial reporting. The Company added disclosure in the Amended 8-K to
reflect this reportable event. This reportable event occurred in conjunction
with Marcum & Kliegman’s audit of the consolidated financial statements for
the year ended June 30, 2006 and not, as stated in the Auditor’s Letter, in
conjunction with Marcum & Kliegman’s “subsequent reviews of the Company’s
condensed consolidated financial statements for the quarterly periods ended
September 30, 2006 and December 31, 2006.” In June 2007, when Marcum &
Kliegman began its review of the Company quarterly financial statements for the
periods ended September 30, 2006 and December 31, 2006, the Company had already
disclosed the material weakness in its internal controls over financial
reporting in the Company’s Annual Report on Form 10-K for the year ended June
30, 2006 (filed on April 12, 2007). Further, no such advice of these material
weaknesses over internal controls was discussed, in writing or orally, with the
Company by representatives of Marcum & Kliegman during the review of such
quarterly financial statements.




The
Company engaged Lazar Levine & Felix, LLP (“LLF”) as its new independent
registered public accounting firm as of September 21, 2007. Prior to its
engagement, LLF had been serving as independent auditors for Properties, an
affiliate and the largest stockholder of the Company.




Environmental
Contingencies




Environmental
matters relating to the Oil Segment include the following:




Related
to its 1999 purchase of the property on Route 46 in Rockaway, New Jersey, the
Company settled a lawsuit with a former tenant of the property and received a
lump sum settlement of $397,500. This sum was placed in an attorney’s escrow
account for payment of all environmental remediation costs. Through June 30,
2008, Able Energy Terminal, LLC has been reimbursed for approximately $310,500
of costs and another $87,000 are not reimbursed and are included in prepaid
expenses and other current assets in the accompanying consolidated balance sheet
included elsewhere in this filing and must be presented to the attorney for
reimbursement. The environmental remediation is currently in progress on this
property.  The majority of the “free standing product” has been
extracted from the underground water table.  The remainder of the
remediation will be completed over the course of the next eight to ten years
using natural attenuation and possible bacterial injection.




F-45


Note
19 - Commitments and Contingencies-continued





Environmental
Contingencies-continued




On
September 15, 2003, Able Oil received approval from the New Jersey Department of
Environmental Protection of a revised Discharge Prevention Containment and
Countermeasure plan ("DPCC") and Discharge, Cleanup and Removal plan ("DCR") for
the facility at 344 Route 46 East in Rockaway, New Jersey. This plan has
received approval and will be in effect for three years. The State of New Jersey
requires companies which operate major fuel storage facilities to prepare such
plans, as proof that such companies are capable of, and have planned for, an
event that might be deemed by the State of New Jersey to be hazardous to the
environment. In addition to these plans, Able Oil has this facility monitored on
an ongoing basis to ensure that the facility meets or exceeds all standards
required by the State.




On
September 26, 2006, the New Jersey Department of Environmental Protection
(“NJDEP”) conducted a site update inspection, which included a review of the
Route 46 site and an update of the progress of the approved
remediation.  The NJDEP Northern Office director who conducted the
inspection, concluded that the remediation progress was proceeding appropriately
and that the department approved of the Company’s continued plan to eliminate
the remaining underground product.  The Company experienced no spill
events that would warrant investigation by state or other environmental
regulatory agencies. All locations are prepared to deal with such an event
should one occur.




Environmental
matters relating to the Travel Plaza Segment include the following:





Clarks Ferry All
American





This site
has been subject to an ongoing groundwater cleanup program since 1996 when a
claim was filed with the Pennsylvania Underground Storage Tank Indemnification
Fund (“USTIF”).  The remedial action plan has been handled by a third
party contractor since 1998.  Active remediation efforts ceased in
2004 and a three-year period of well monitoring was started in 2005 calling for
six semi-annual well sampling events.




USTIF
coverage for the site was approved at 65% of total remediation
costs.  In 2004, cost estimates to complete the remediation project
were prepared by the third party contractor and Properties accepted a lump sum
payout from USTIF of approximately $32,000 (65% of $48,000 estimate of
completion costs). In September 2007, the final sampling event was completed and
results were favorable.  A “Post Remedial Care Plan Completion Report”
was submitted to the PA DEP in January 2008 and was accepted the following
month. Monitoring wells were closed in March 2008, and a final billing generated
for the remedial activities.  At June 30, 2008, Plazas owed $8,000 for
completion of these activities.





Frystown All
American





This site
is subject to an ongoing groundwater cleanup program that started in 1998 when
the old tanks and fuel islands were replaced.  Tanks were not leaking,
but lines in the fuel island area had leaked and created the need for soil
removal and groundwater cleanup.  It is also believed that a heating
oil tank removed in the early 90’s was an additional source of
contamination.  The site was accepted by USTIF for 100%
coverage.  The groundwater pump and treat system was activated in
December, 2001 and was shut down in October, 2005, as the monitoring wells came
into compliance.  The quarterly well monitoring period was started in
December, 2005 and the final well sampling event in September 2007 was
uneventful.   The contractor is currently preparing the final
site closure report, which will be submitted to the PA DEP for final closure and
concurrence that no further remedial activities are necessary.





Belmont All
American





This site
has been subject to an ongoing groundwater remediation since 2004, when a leak
was found in a flex hose at a dispenser.  A groundwater filtration
system went online in November, 2005.  Monthly well samples are taken
and good progress is being shown towards the attainment of
compliance.  Full closure of the site is expected within the next
twelve (12) months, with an anticipated cost of approximately $35,000 to
Plazas.


Doswell All
American




F-46


Note
19 - Commitments and Contingencies-continued




Environmental
Contingencies-continued




This site
presently has no underground storage tanks (“UST's”) in use for storage of
petroleum products.  Diesel fuel storage is in two above ground
storage tanks (“AST’s”); one 500,000 gallons and the other is 100,000
gallons.




In
November, 2005, the Virginia Department of Environmental Quality (“VA DEQ”)
issued a violation for an unknown release of petroleum product into a storm
water runoff pond at the site.  Several source areas were identified
and ultimately ruled out, with the exception of an oil/water separator that was
found to have a faulty valve allowing oil runoff to bypass separator and drain
directly to the pond.  A new oil/water separator was put in place in
December, 2005.  On July 9, 2007, the VA DEQ issued a letter canceling
any further action relative to this violation.




In April,
2007, the VA DEQ notified Plazas that, due to a change in regulations with
respect to AST containment requirements, Plazas would be required to make
changes to the existing AST’s and/or containment berm by December 31,
2007.  After consideration of various options to bring the site into
compliance, it was decided that the best alternative was to dismantle the
500,000 gallon AST.




In
November 2007, the 500,000 gallon AST was dismantled and removed from the site
at a cost of approximately $15,000.  Soil borings in the area of the
tank and pad have been clean.  No further cost is anticipated relative
to this project.




Other
Contingencies




On
December 8, 2006, the Company commenced an action in the Superior Court of
California, for the County of Los Angeles against Summit Ventures, Inc.
(“Summit”), Mark Roy Anderson (“Anderson”), the principal of Summit and four
other companies controlled by Anderson, Camden Holdings, Inc., Summit Oil and
Gas, Inc. d/b/a Nevada Summit Oil and Gas, Harvest Worldwide, LLC and Harvest
Worldwide, Inc. seeking to compel the return of 142,857 shares (the “Shares”) of
the Company’s common stock issued to Summit.  The Shares were issued
to Summit in connection with a consulting agreement the Company had entered into
with Summit in January 2005. The complaint also sought damages as a result of
Summit’s and Anderson’s breach of contract, fraud and misrepresentation with
respect to the consulting agreement.  On June 28, 2007, Summit and
Anderson interposed a cross-complaint against the Company, Greg Frost, the
Company’s Chief Executive Officer and Chairman, Chris Westad, the President of
the Company’s home heating Oil Segment subsidiaries, Able Oil, Inc., Able Energy
New York, Inc. and Able Oil Melbourne, Inc., Frank Nocito, Vice President of
Business Development for the Company, Stephen Chalk, a Director of the Company
and Timothy Harrington, the former Chief Executive Officer of the Company. On
October 10, 2007, the Company settled the Anderson Litigation, which included
the issuance of 142,857 shares of the Company’s common stock to
Summit.  The shares were treated as issued on June 30,
2007.




SEC
Formal Order of Private Investigation




On
September 7, 2006, the Company received a Formal Order of Private Investigation
from the SEC pursuant to which the Company, certain of its officers and a
director were served with subpoenas requesting certain documents and
information. The Formal Order authorizes an investigation of possible violations
of the anti-fraud provisions of the federal securities laws with respect to the
offer, purchase and sale of the Company's securities and the Company's
disclosures or failures to disclose material information. The Company believes
that it did not violate any securities laws and intends to cooperate fully with
and assist the SEC in its inquiry. The Company produced all responsive documents
to the subpoenas.




On August
31, 2007, the Company was served with a second subpoena duces tecum (the “Second
Subpoena”) from the SEC pursuant to the Formal Order of Investigation issued by
the SEC on September 7, 2006. The Company continues to gather, review and
produce documents to the SEC and is cooperating fully with the SEC in complying
with the Second Subpoena. As of the date of this Report, the Company has
produced and will, if required, continue to produce responsive documents and
intends to continue cooperating with the SEC in connection with the
investigation.  On May 13, 2008, the Company received correspondence
from the SEC requesting the Company respond, in writing, to eleven questions
proffered by the SEC staff.  The Company provided its responses to the
eleven questions to the SEC on May 21, 2008.  The responsive
correspondence was signed by the Company’s outside SEC counsel, Buchanan
Ingersoll & Rooney, PC, after it was reviewed by the Company’s senior
management, as well as the Company’s outside financial
consultants.  The Company has produced and continues to produce
responsive documents and intends to continue cooperating with the SEC in
connection with the investigation (See Note 21 - Subsequent Events,
below).




F-47




Note
20 - Selected Quarterly Financial Data (Unaudited and Restated)





The
following tables set forth our unaudited consolidated financial results for the
last eight fiscal quarters ended June 30, 2008:




For
      the Year Ended June 30, 2008(Unaudited)
              
              First
      Quarter
              
              
              Second
      Quarter
              
              
              Third
      Quarter
              
              
              Fourth
      QuarterNet
      sales
              
              $
              66,993,371
              
              
              $
              78,020,375
              
              
              $
              78,364,259
              
              
              $
              53,062,583Gross
      profit
              
              $
              3,432,256
              
              
              $
              5,340,277
              
              
              $
              5,712,066
              
              
              $
              3,098,055Net
      loss
              
              $
              (4,309,905
              )
              
              $
              (2,468,493
              )
              
              $
              (2,203,330
              )
              
              $
              (3,931,505
              )Basic
      and diluted loss per shareContinuing
      operations:
              
              $
              (0.29
              )
              
              $
              (0.17
              )
              
              $
              (0.15
              )
              
              $
              (0.26
              )Basic
      and diluted average number ofcommon
      shares outstanding:
              
              
              14,950,947
              
              
              
              14,950,947
              
              
              
              14,950,947
              
              
              
              14,960,945




In the
table above, earnings (loss) per share from continuing operations for each
quarter was computed using the weighted-average number of shares outstanding
during the quarter.  However, earnings (loss) per share from
continuing operations for the year were computed using the weighted-average
number of shares outstanding during the year.  As a result, the sum of
the loss per share for the four quarters may not equal the full year earnings
(loss) per share.




F-48




Note
20 - Selected Quarterly Financial Data (Unaudited and Restated) -
continued





The
selected quarterly financial data for the periods within the fiscal year ended
June 30, 2007, as presented below, have been restated and correct errors
relating to the amortization of deferred financing costs associated with the
Manns financing (See Note 18).




For
      the Year Ended June 30, 2007(Unaudited)
              
              First
      Quarter
              
              
              Second
      Quarter
              
              
              Third
      Quarter
              
              
              Fourth
      Quarter(Restated)
              
              
              (Restated)Net
      sales as previously reported
              
              $
              12,835,553
              
              
              $
              19,266,016
              
              
              $
              29,366,596
              
              
              $
              32,173,383Adjustments
              
              N.A.
              
              
              N.A.
              
              
              N.A.
              
              
              N.A.Restated
      net sales
              
              $
              12,835,553
              
              
              $
              19,266,016
              
              
              $
              29,366,596
              
              
              $
              32,173,383Gross
      profit as previously reported
              
              $
              1,193,930
              
              
              $
              1,723,192
              
              
              $
              3,665,916
              
              
              $
              1,954,976Adjustments
              
              N.A.
              
              
              N.A.
              
              
              N.A.
              
              
              N.A.Restated
      gross profit
              
              $
              1,193,930
              
              
              $
              1,723,192
              
              
              $
              3,665,916
              
              
              $
              1,954,976Net
      income (loss) as previously reported
              
              $
              (1,639,875
              )
              
              $
              (1,462,397
              )
              
              $
              553,030
              
              
              $
              (3,368,061
              )Adjustments
              
              
              (540,000
              )
              
              
              (175,000
              )
              
              N.A.
              
              
              N.A.Restated
      net income (loss)
              
              $
              (2,179,875
              )
              
              $
              (1,637,397
              )
              
              $
              553,030
              
              
              $
              (3,368,061
              )Basic
      and diluted earnings per shareContinuing
      operations:Net
      income (loss) as previously reported
              
              $
              (0.52
              )
              
              $
              (0.47
              )
              
              $
              0.18
              
              
              $
              (0.47
              )Adjustments
              
              
              (0.18
              )
              
              $
              (0.05
              )
              
              N.A.
              
              
              N.A.Net
      income (loss) as restated
              
              $
              (0.70
              )
              
              $
              (0.52
              )
              
              $
              0.18
              
              
              $
              (0.47
              )Basic
      and diluted average number ofcommon shares
    outstanding:As
      previously reported
              
              
              3,133,731
              
              
              
              3,141,423
              
              
              
              3,141,423
              
              
              
              7,117,352Adjustments
              
              N.A.
              
              
              N.A.
              
              
              N.A.
              
              
              N.A.As
      restated
              
              
              3,133,731
              
              
              
              3,141,423
              
              
              
              3,141,423
              
              
              
              7,117,352




In the
table above, earnings (loss) per share for each quarter were computed
independently using the weighted-average number of shares outstanding during the
quarter.  However, earnings (loss) per share for the year were
computed using the weighted-average number of shares outstanding during the
year.  As a result, the sum of the earnings per share for the four
quarters may not equal the full-year earnings (loss) per share.





Note
21 - Subsequent Events (Unaudited)





Lease
of Newton Facility




On July
14, 2008, the Company executed a triple net lease agreement with North Jersey
Oil, Inc. (North Jersey) for the use of the Company’s idled Newton, NJ fuel
terminal facility. The term of the lease is for thirty years.  Upon
execution, the lease agreement provides for a $250,000 cash payment to the
Company and the receipt of a $250,000 Tenant’s Promissory Note (together, the
“Basic Rent”). The note provides for interest at 8% and twelve monthly
payments.  Payments are to commence on the date that North Jersey
receives all of the necessary permits to conduct its operations at the Newton
site.  If within six months of the execution date of the lease
agreement North Jersey is unable to secure the necessary operating permits or
during the same time North Jersey is advised that its applications for the
necessary operating permits have been denied, the Company will be obligated to
return the Basic Rent to North Jersey and terminate the lease
agreement.  The status of the operating permits as of the filing date
of this Annual Report on Form 10-K is not known.  The lease agreement
also provides both the Company and North Jersey with storage and throughput
rights at their respective terminals at a cost to the user of $0.05 per
gallon.




F-49




Note
21 - Subsequent Events (Unaudited)-continued




Lease
of Newton Facility-continued




In
addition, North Jersey is obligated to provide the Company with an initial
six-month, $0.5 million fuel purchase credit facility at a cost to the Company
of $0.02 per gallon financed.  The lease agreement also provides North
Jersey with a $1.00 purchase option, which North Jersey can exercise upon
payment in full, in cash, of all the Basic Rent.




Credit
Card Receivable Financing




On August
14, 2008 and November 5, 2008, the Oil Segment of the Company and its
subsidiary, PriceEnergy.com, refinanced their loans with Credit Cash, in the
amounts of $500,000 and $250,000 respectively.  Also on August 14,
2008, Plazas refinanced its loan with Credit Cash in the amount of
$900,000.  (See Note 10). The outstanding Credit Cash loan for the
Company as of June 30, 2008 was $621,093.




SEC
Formal Order of Private Investigation




On July
29 and 30, 2008, the Company’s CEO, Mr. Frost and the Company’s Executive
Vice-President, Business Development, Mr. Nocito, were deposed by the
SEC.  The Company has been advised by its SEC counsel, who also
attended the depositions, that it believes the primary focus of the
investigation is for the Company to complete its outstanding, delinquent SEC
filings in order to obtain filing compliance.




S&S
Settlement Agreement




Effective
July 22, 2008, the Company and S&S NY Holdings, Inc (“S&S”) executed a
settlement agreement.  In exchange for total consideration of
approximately $1.5 million, consisting of principal and interest due S&S,
S&S assumption of a specific liability and the purchase of existing
inventory, the Company transferred to S&S 49% of the common stock of its
subsidiary, Able Energy New York, Inc. (“Able NY”) and 90% of its
interest in its Easton and Horsham, PA operations (“Able
PA”).   Under specific situations, the Company’s filing for
bankruptcy or default on payment of specific debt, S&S has a call option on
the remaining 51% of Able NY for an additional $1.0 million and other valuable
consideration.  For a period of one year from the execution of the
settlement agreement, S&S has an option to purchase the remaining 10%
of Able PA for $50,000 and other valuable
consideration.  Able NY has also entered into a consulting agreement
with S&S under which S&S will be paid five percent of Able NY’s gross
profit for its management services provided to Able NY.




Amendment
To S&S Settlement Agreement




On
October 31, 2008, the Company and S&S NY Holdings, Inc. (“S&S”) entered
into an agreement amending (the “Amendment”) the Settlement Agreement. The
Amendment provides that the Company has the right to repurchase S&S’s
interest in Able PA for the sum of $548,910 payable $250,000 upon the signing of
the Amendment and the balance ten business days thereafter. In the event that
the balance is not paid within the time period specified, S&S shall retain
the initial payment of $250,000 and its interest in Able PA.  The
Amendment further provides that the Company may repurchase S&S’s 49%
interest in Able NY for the sum of $550,000 payable $150,000 within thirty days
after the repurchase of Able PA; commencing thirty days after such payment,
eight (8) equal monthly installments each in the amount of $30,000; and the
balance of $160,000 to be made thirty days after the final monthly installment
is paid. S&S shall retain its interest in Able NY as security for such
payments. However, as long as Able is not in default of such payments, S&S
shall have no rights whatsoever with respect to its shares of stock in Able NY,
including, but not limited to, any distribution of any revenues, profits or net
profits of Able NY.  In the event that Able defaults in making such
payments and fails to timely cure such default, S&S shall retain full
ownership with all attendant shareholder rights thereto of its shares of stock
in Able NY, provided, however, S&S’s ownership percentage of Able NY will be
reduced by the percentage of payments made to Able NY prior to the default as
applied to the total purchase price for S&S’s interest in Able NY. The
Amendment also cancelled the Consulting Agreement which was to be entered into
pursuant to the terms of the Settlement Agreement between Able NY and S&S in
exchange for a payment of $60,000 to be made at the time the final payment is
due for payment of the Able NY shares.




F-50


Note
21 - Subsequent Events (Unaudited) - continued





Litigation




On
September 17, 2008 an action was commenced in the Common Court of Pleas in
Northumberland County, Pennsylvania against All American Plazas, Inc. (“Plazas”)
by SCC3, LLC. The action arises out of a note (the “Note”) made by Milton
Properties, Inc. (“Milton”), the owner of the real property (the “Property”)
underlying the Milton travel plaza which is leased to, and operated by, Plazas,
to Silar Special Opportunities Fund, L.P.(“Silar”) and a mortgage (the
“Mortgage”) granted by Milton to Silar on the Property to secure the Note. Silar
subsequently assigned the Note and Mortgage to the plaintiff, SCC3,
LLC.  As further security for Milton’s obligations under the Note,
Milton assigned to Silar its lease with Plazas for the Property and the rents
therefor (the “Assignment of Leases and Rent”). The lease (the “Lease”) for the
property will expire in 2013.  Silar also assigned its rights under
the Assignment of Leases and Rents to the plaintiff.  The complaint
alleges that Milton is in default of its obligations under the Note and
Mortgage. As a result, plaintiff alleges that it has exercised its rights under
the Assignment of Lease and Rents and revoked Milton’s right to collect rent for
the Property. The plaintiff further alleges that Plazas is in default of its
obligations under the Lease and that pursuant to the Assignment of Lease and
Rents plaintiff has the right to enforce the Lease and declare all rent for the
remainder of the term of the Lease to be due and payable. Plaintiff is seeking
damages in the amount of $17,855,024 representing the balance of rent due under
the term of the Lease.  Plazas has filed an answer denying the
allegations of the complaint. Plazas intends to make vigorously defend this
action and will make a motion to dismiss the complaint.




On
October 7, 2008 a complaint was filed in the United States District Court for
the Western District of Texas by Petro Franchise Systems, LLC and TA Operating,
LLC, Plaintiffs, against All American Properties, Inc.(“Properties”), All
American Plazas, Inc. (“Plazas”) and The Chelednik Family Trust (the “Trust”),
(collectively the “Defendants”). The complaint seeks monetary damages and
injunctive relief arising out of Properties’ and Plazas’ alleged breach of Petro
franchise agreements for the Petro travel centers located in Breezewood and
Milton, Pennsylvania and the Trust’s guaranty of the Milton franchise
agreement.  Plaintiffs are seeking damages in the amounts of $149,851
and $154,585 for the alleged breach of the Breezewood and Milton franchise
agreements, respectively. In addition, the complaint is requesting damages for
violations of the Lanham Act, including the continued purported improper use by
Properties and Plazas of the registered Petro trademarks and the dilution of
those trademarks; unfair competition and unjust enrichment; trademark
infringement under Texas state law; and, conversion. As of the date of this
Report, the complaint has not been served upon the defendants.




PriceEnergy.com,
Inc.





On
September 22, 2008, the Company was granted additional shares of common stock of
its majority owned subsidiary, PriceEnergy.com, Inc., in exchange for
satisfaction of $3.8 million of debt owed to the Company, increasing its
ownership interest in Price Energy to 92%.




Change in Officer
Status




On
October 22, 2008, Louis Aponte was appointed as President of the Company’s home
heating oil subsidiaries. Mr. Aponte will be responsible for the daily
operations of Able’s home heating business, as well as the operation of Able’s
Rockaway Terminal. Mr. Aponte is taking the place of Christopher Westad who will
remain with the Company working in its New York offices in charge of special
projects for the Company.




Fuel Supply
Agreement




On
October 31, 2008, All American Plazas, Inc. (“Plazas”) entered into agreements
with UCP Capital Management, LLC (“UCP”) pursuant to which UCP will arrange for
the consignment and distribution of gasoline obtained from Gulf Oil or Valero
Oil terminals and motor diesel fuel at the travel plazas operated by Plazas.
Once delivered, Plazas will have complete control over the product delivered
including the retail prices at which the gasoline is sold. UCP will retain the
cost of the fuel as determined by the Gulf or Valero Branded Rack price for the
gasoline or its cost of the diesel fuel plus two cents plus all applicable taxes
and delivery charges per gallon for each gallon of gasoline delivered by UCP and
sold by Plazas in a given month. Plazas will retain the difference between the
amount retained by UCP and the price per gallon of gasoline or diesel fuel sold.
Pursuant to this agreement the gasoline islands at the travel plazas operated by
Plazas will be branded with either the Gulf or Valero tradename. The term of the
agreements shall be effective on November 1, 2008 and run through October 31,
2013.





F-51





Note 21 - Subsequent Events
(Unaudited) – continued





Sublease of Travel
Plazas




Effective November
1, 2008, All American Plazas, Inc. subleased the operation of the Carlisle
Gables, Harrisburg Gables and Frystown Gables plazas to independent third
parties each for a term of three years. Plazas determined the sublease of these
facilities would cut its costs, but Plazas also maintained the right to supply
the fuel to these plazas on a cost plus basis which it believes will result in a
net profit to the Company. Each of the subleases provides for the purchase of
the existing inventory and the Frystown Gables sublease provides for a three
month abatement of rent.





F-52




PART
III
 
 Item
10. Directors and Executive Officers of the Registrant
 
 DIRECTORS
AND EXECUTIVE OFFICERS
 
 As of
June 30, 2008, the directors and executive officers of the Company are as
follows:
  Name
                
                Age
                
                Title
                
                Compensation
      Committee
                
                Audit
                  Committee
                
                Governance
                  and
                  Nominating
      CommitteeGregory
      D. Frost, Esq.
                
                61
                
                Chairman,
      Chief Executive Officer &  DirectorRichard
      A. Mitstifer
                
                51
                
                PresidentWilliam
      Roger Roberts
                
                55
                
                Chief
      Operating OfficerDaniel
      L. Johnston
                
                46
                
                Chief
      Financial OfficerFrank
      Nocito
                
                61
                
                Executive
      Vice-PresidentChristopher
      P. Westad
                
                55
                
                President,
      Home Heating Oil UnitJohn
      L.Vrabel
                
                55
                
                Chief
      Operating Officer, Price Energy UnitStephen
      Chalk
                
                63
                
                DirectorSolange
      Charas
                
                46
                
                Director
                
                **
                
                *Edward
      C. Miller, Jr.
                
                41
                
                Director
                
                
                
                *Patrick
      O'Neill
                
                48
                
                Director
                
                *
                
                
                
                *Alan
      E. Richards
                
                71
                
                Director
                
                
                
                **
                
                *
  *Member
 ** Chair
 Note:
 On
October 22, 2008, Louis Aponte was appointed as President of the Company’s Home
heating oil subsidiaries, in place of Christopher P. Westad.  See,
Note 21-Subsequent Events, to the Consolidated Financial Statements in Item 8 of
this Annual Report.
 
 Background
 
 Set forth
below is a brief background of the executive officers and directors of the
Company, based on information supplied by them.
 
 GREGORY
D. FROST, ESQ. became General Counsel and a Director of the Company in April
2005.   Mr. Frost served as CEO and Chairman from October 2005
until September 28, 2006, when he took a leave of absence.  Mr. Frost
returned as CEO and Chairman on May 24, 2007, and has continued to serve in
those positions to-date. From 1974 to the present, he has been a practicing
attorney in the State of New York and from 1999 until October of 2005, he was a
partner of the law firm of Ferber Frost Chan & Essner, LLP (formally known
as Robson Ferber Frost Chan & Essner, LLP) which has in the past performed,
and continues to perform, legal services for the Company.  Mr. Frost's
main areas of practice have been and continue to be mergers and acquisitions,
and general corporate and securities matters.  From 1975 through 1980,
he was Assistant General Counsel at The Singer Company and RH Macy &
Co.  Thereafter, Mr. Frost spent approximately 12 years as a partner
of the law firm of Bower & Gardner, managing their corporate and securities
department.  In 1970, Mr. Frost received a B.A. degree from New York
University (Stern School).  He received his Juris Doctorate in 1973
from New York Law School, and in 1979 obtained a Master of Law Degree (LLM) in
Corporate Law from New York University Law School.
  RICHARD
A. MITSTIFER became President of the Company on September 24,
2007.  Mr. Mitstifer graduated from Muhlenberg College in 1979 with
degrees in Business Administration and Accounting. He entered the banking
industry in 1979, where he had a sixteen-year career in commercial lending,
gaining exposure to several types of businesses from retail to manufacturing. He
joined All American Properties, Inc., formerly known as All American Plazas,
Inc., in 1995 as Vice-President of Finance, where he oversaw all banking,
insurance, human resources and accounting functions. He became President of All
American Properties, Inc. in 2003.
  45
  WILLIAM
ROGER ROBERTS became the Company’s Chief Operating Officer on September 24,
2007.  Mr. Roberts has over thirty years of experience in various
capacities, including ten years of restaurant management with Food Franchises,
Inc. from 1974 to 1978 and then from 1981 to 1985 as General Manager,
and twenty years of multi-Segment supervision in the Travel
Center/Convenience store industry with Pantry Convenient Stores, from 1978 to
1981 as a district manager, Benton Service Oil Company from 1985 to 1990 as
Vice-President of Operations, Interstate Facilities from 1990 to 1995 as General
Manager, Coleman Oil Company from 1995 to 1998 as Vice-President of Operations,
Cross Road Travel Plaza from 1998 to 2002 as General Manager, and from
September, 2007 to present as Vice-President and Chief Operating Officer of All
American Properties, Inc.
  DANIEL L.
JOHNSTON became the Company’s Chief Financial Officer on September 24,
2007.  Mr. Johnston graduated from Westminster College in 1984 with a
degree in Business Administration/Accounting. He worked for Price Waterhouse
from August 20, 1984 to December 28, 1988 where he became Senior Accountant in
June 1987, responsible for various audits of several large companies. He entered
his family’s travel plaza business in 1989 in an executive capacity as
Vice-President and later Treasurer, handling all Accounting, IT, Human Resource
and Administrative functions, as well as Garage and Sanitary Operations for the
two travel plazas owned by his father, brother and himself. From 1991 to 1993,
he served on the executive committee that acted in an advisory capacity to an
investment group and truck stop operators, who acquired the chain of Unocal 76
Truck Stops. In addition to his involvement in his family’s travel plaza
business, from 1991 to present Mr. Johnston maintains a private CPA practice
providing accounting and payroll services, software installation and technical
support for independent travel plazas and restaurant chains. Mr. Johnston joined
All American Properties, Inc., in 2004 and became its Controller in early
2006.
  FRANK
NOCITO became Vice President Business Development of the Company in April 2005
and was appointed Executive Vice-President, Business Development on September
24, 2007.   Previously, from 2003 and through April 2005, Mr.
Nocito was Vice President of All American Plazas, Inc., which is now known as
All American Properties, Inc. (“Properties”), which owned and operated ten truck
plazas located in Pennsylvania, New York, New Jersey and Virginia.  On
May 30, 2007, the Company acquired the operating assets of these plazas and
Properties retained ownership of the underlying real estate upon which the
plazas are located, together with any buildings and improvements on the
respective properties.  Properties own approximately 74% of the
outstanding common stock of our Company.  In 2003, Mr. Nocito, as Vice
President of All American Industries Corp., acquired all of the issued and
outstanding stock of Properties.  In 2004, Mr. Nocito and his wife
created, for the benefit of their family members, including seven children, the
Chelednik Family Trust, and approximately 85% of the issued and outstanding
stock of Properties is beneficially owned by the Trust.  In 2002, as a
consultant to two start-up corporations, American Truck Stop of Belmont Inc. and
American Truck Stop of Carney Inc., Mr. Nocito assisted the new entities in
acquiring two truck plazas located in the Northeast.  Subsequent to
the purchase of these two truck plazas, he became in November 2003, and remains,
a vice president of both corporations.  In 2001, Mr. Nocito was
employed by WDF/Keyspan, Inc., as a supervisor in charge of multi-million dollar
conversion projects for the New York City School System, converting school
facilities from coal to oil and gas systems.  In 1996, under cover of
a 1994 sealed indictment that had never been acted upon, an indictment was
issued against Mr. Nocito for conspiracy to commit money
laundering.  The charge was the result of his political activities as
part of the Republican Party and events arising out of the United States
Government's support of the Nicaraguan Government under the Sandinista
regime.  In late 1998, Mr. Nocito accepted a plea offer that resulted
in his serving a 19-month detention plus three years probation, which ended May
2004.  Mr. Nocito's educational background includes his attending
Syracuse University, Marymount College/Fordham University and Nova
University.
  CHRISTOPHER
P. WESTAD became President of the Company in 1998, and a Director when the
Company went public in 1999.  His current employment contract runs
through November 25, 2009.  He is currently responsible for the
Company’s special projects.  From May 23, 2007 to October 22, 2008, he
served as the President of all of the Company’s Oil Segment
subsidiaries.  From September 28, 2006 to May 23, 2007, he served as
Acting Chief Executive Officer of the Company.  He also served as the
Company’s Chief Financial Officer from 2000 to August 2005, and again from July
2006 through September 2006.  Since September 1996, Mr. Westad had
also served as the President of Able Propane until the sale of that subsidiary
in March, 2004.  From 1991 through 1996, Mr. Westad was Market Manager
and Area Manager for Ferrellgas Partners, L.P., a company engaged in the retail
sale and distribution of liquefied petroleum gas.  From 1977 through
1991, Mr. Westad served in a number of management positions with RJR
Nabisco.  In 1975, Mr. Westad received a Bachelor of Arts in Business
and Public Management from Long Island University, Southampton, New
York.
  JOHN L.
VRABEL became Chief Operating Officer of the Company in August
2003.  His employment contract expired July 1, 2007.  While
his employment contract was not renewed, he continues to be employed by the
Company in the same capacity.  From 2000 through the present, he has
served as Vice President Business Development of the Company’s PriceEnergy
subsidiary.  From 1996 to 2000, Mr. Vrabel was Vice President of
Business Development of Connective Holdings Vital Services, LLC, a subsidiary of
Connective Holdings in the energy products and services sector.  He
received a B.A. from the University of Houston in 1976, and participated in an
Executive MBA from Baldwin-Wallace College in 1982 and 1983.
  46
 STEPHEN
CHALK became a Director of the Company in February 2005.  From 1981 to
the present, Mr. Chalk has served as the President of the Pilgrim Corporation,
where he has obtained a strong background in financial management, as well as
over 25 years of hotel, resort, restaurant, and real estate development
experience.  Mr. Chalk is a graduate of Philadelphia University with a
BS in Engineering and Design.
  SOLANGE
CHARAS became a director of the Company in May 2005.  In 2000, Ms.
Charas founded Charas Consulting, Inc., which provides human resources
consulting services.  From 2002 though 2005, Ms. Charas was the Head
of Human Resources for Benfield, Inc.  In her role, she was
responsible for all aspects of human resources for this
organization.  She is currently a retained consultant to
Benfield.  From 1999 to 2000, Ms. Charas was the Head of Human
Resources for EURO RSCG Worldwide, an advertising firm, which is the largest
division of France-based Havas Advertising.  As Head of Human
Resources, she was responsible for the creation and management of all HR
programs on a worldwide basis for over 200 agencies, which made up EURO
RSCG.  From 1996 to 1999, Ms. Charas was the National Director at
Arthur Andersen, where she led all activities promoting a consulting product she
was instrumental in creating for the firm.  From 1995 to 1996, Ms.
Charas was the leader of the International Compensation Team at Towers Perrin
and a Senior Consultant with respect to international compensation at the Hay
Group.  Ms. Charas received an undergraduate degree in International
Political Economy from University of California at Berkeley in 1982 and an MBA
in Accounting and Finance from Cornell University's Johnson School of Management
in 1988.
  EDWARD C.
MILLER, JR. has served as a Director of the Company since 1999.  Mr.
Miller has served in several marketing positions since 1999 and currently serves
as the Chief Marketing Officer for the law firm of Norris, McLaughlin &
Marcus, P.A., located in Somerville, New Jersey.  From 1991 to 1999,
Mr. Miller served as Marketing Coordinator at the Morristown, New Jersey, law
firm of Riker, Danzig, Scherer, Hyland & Perretti, LLP.  Mr.
Miller received a B.S. in Marketing Management from Syracuse University School
of Management in 1991.
  PATRICK
O'NEILL has served as a Director of the Company since 1999.  Mr.
O'Neill has been involved in the management of real estate development and
construction management for over 20 years, and has served as the President of
Fenix Investment and Development, Inc., a real estate company based in
Morristown, New Jersey, for the past ten years.  Prior to that, Mr.
O'Neill served as Vice President of Business Development for AvisAmerica, a
Pennsylvania-based home manufacturer.  Mr. O'Neill holds a B.S. from
the United States Military Academy.
  ALAN E.
RICHARDS became a Director of the Company in February 2005.  Mr.
Richards has served as the President of Sorrento Enterprises Incorporated, a
forensic accounting firm, from its inception in 1979 to the
present.  Mr. Richards brings a diverse background and over 25 years
of experience in financial services, including work with government agencies
such as the United States Internal Revenue Service.  Mr. Richards is a
graduate of Iona College with a BBA in Finance.
 
 Family
and Other Relationships
 
 There are
no family relationships between any of the present directors or executive
officers of the Company.
 
 Involvement in Certain Legal
Proceedings
 
 To the
knowledge of management, no director, executive officer or affiliate of the
Company or owner of record or beneficially of more than 5% of the Company's
common stock is a party adverse to the Company or has a material interest
adverse to the Company in any proceeding.
 
 To the
knowledge of management, during the past five years, no present director,
executive officer or person nominated to become a director or an executive
officer of the Company:
 
 (1)
                Filed
      a petition under the federal bankruptcy laws or any state insolvency law,
      nor had a receiver, fiscal agent or similar officer appointed by a court
      for the business or property of such person, or any partnership in which
      he or she was a general partner at or within two years before the time of
      such filing, or any corporation or business association of which he or she
      was an executive officer at or within two years before the time of such
      filing;
  47
  (2)
                Was
      convicted in a criminal proceeding or named the subject of a pending
      criminal proceeding (excluding traffic violations and other minor
      offenses);
 
 (3)
                Was
      the subject of any order, judgment or decree, not subsequently reversed,
      suspended or vacated, of any court of competent jurisdiction, permanently
      or temporarily enjoining him or her from or otherwise limiting his or her
      involvement in any type of business, commodities, securities or banking
      activities;
 
 (4)
                Was
      the subject of any order, judgment or decree, not subsequently reversed,
      suspended or vacated, of any Federal or State authority barring,
      suspending or otherwise limiting him or her for more than 60 days from
      engaging in, or being associated with any person engaging in, any type of
      business, commodities, securities or banking
  activities;
 
 (5)
                Was
      found by a court of competent jurisdiction in a civil action or by the SEC
      or the Commodity Futures Trading Commission (“CFTC”) to have violated any
      federal or state securities law or Federal commodities law, and the
      judgment in such civil action or finding by the SEC or CFTC has not been
      subsequently reversed, suspended or
vacated.
 
 SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 
 Section
16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's
officers, directors and persons who own more than 10% of a registered class of
the Company's equity securities to file reports of ownership on Form 3 and
changes in ownership on Form 4 or Form 5 with the Securities and Exchange
Commission ("SEC").  Such officers, directors and 10% stockholders are
also required by SEC rules to furnish the Company with copies of all Section
16(a) forms they file.
 
 Based
solely on a review of copies of the Forms 3, 4 and 5 received by the Company or
representations from certain reporting persons, the Company believes that,
during the year ended June 30, 2008, all Section 16(a) filing requirements
applicable to its officers, directors and 10% stockholders were met in a timely
manner, except that All American Properties, Inc. failed to timely file
four Reports on Form 4 regarding the transfer of shares to seven individuals and
one entity to pay for services rendered and certain outstanding
loans.  All of these reports were subsequently filed.
 
 CODE
OF ETHICS
 
 The
Company's Board of Directors has adopted a Code of Ethics that applies to the
Company's financial officers and executive officers, including its Chief
Executive Officer and Chief Financial Officer.  The Company’s Board of
Directors has also adopted a Code of Conduct and Ethics for Directors, Officers
and Employees including the Company’s Chief Executive Officer and Chief
Financial Officer.  A copy of this code can be found at the Company's
Internet website at www.ableenergy.com.  The Company intends to
disclose any amendments to its Code of Ethics, and any waiver from a provision
of the Code of Ethics granted to the Company's President, Chief Financial
Officer or persons performing similar functions, on the Company's Internet
website within five business days following such amendment or
waiver.  A copy of the Code of Ethics can be obtained free of charge
by writing to: Christopher P. Westad, Secretary, Able Energy, Inc., 198 Green
Pond Road, Rockaway, New Jersey 07866.
 
 COMPENSATION
OF DIRECTORS
 
 In fiscal
2008, for their service on the Board of Directors, the Company accrued aggregate
compensation in the amount of $121,000, none of which was paid, to its outside
directors: Mr. O’Neill, Mr. Miller, Mr. Richards and Ms. Charas.
 
 AUDIT
COMMITTEE AND AUDIT COMMITTEE FINANCIAL EXPERT
  We have a
separately designated standing Audit Committee established in accordance with
Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”).  In fiscal 2008, the members of the Audit Committee
were Mr. Richards (chair), Mr. Miller and Ms. Charas.  The Board of
Directors has determined that each of the members of the Audit Committee is
independent as defined by Section 10A(m)(3) of the Exchange Act.  In
addition, the Board of Directors has determined that Mr. Richards is an “audit
committee financial expert,” as that term is defined in Item 407(d)(5) of
Regulation S-K under the Exchange Act.  The Audit Committee adopted an
Audit Committee Charter during fiscal 2006, a copy of which is available on the
Company’s Internet website, www.ableenergy.com. The Audit Committee reviews and
reassesses the Audit Committee Charter annually.
  48
 REPORT OF
THE AUDIT COMMITTEE
 
 The
following Report of the Audit Committee does not constitute soliciting material
and should not be deemed filed or incorporated by reference into any other
Company filing under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this Report
by reference therein.  The charter of the Audit Committee of the Board
specifies that the purpose of the Committee is to assist the Board in its
oversight of:
 
 ·
              The
      integrity of the Company's consolidated financial
    statements;
 ·
              The
      adequacy of the Company's system of internal
  controls;
 ·
              The
      Company's compliance with legal and regulatory
    requirements;
 ·
              The
      qualifications and independence of the Company's independent registered
      public accountants; and
 ·
              The
      performance of the Company's independent registered public accountants and
      of the Company's internal audit
function.
 
 In
carrying out these responsibilities, the Audit Committee, among other
things:
 
 ·
              Monitors
      preparation of quarterly and annual financial reports by the Company's
      management;
 ·
              Supervises
      the relationship between the Company and its independent registered public
      accountants, including: having direct responsibility for their
      appointment, compensation and retention; reviewing the scope of their
      audit services; approving audit and non-audit services; and confirming the
      independence of the independent registered public accountants;
      and
 ·
              Oversees
      management's implementation and maintenance of effective systems of
      internal and disclosure controls, including review of the Company's
      policies relating to legal and regulatory compliance, ethics and conflicts
      of interests and review of the Company's internal auditing
      program.
 
 The
Committee met seven times during fiscal 2008. The Committee schedules its
meetings with a view to ensuring that it devotes appropriate attention to all of
its tasks. The Committee's meetings include, whenever appropriate, executive
sessions with the Company's independent registered public accountants without
the presence of the Company's management.
 
 The Audit
Committee serves in an oversight capacity and is not intended to be part of the
Company's operational or managerial decision-making process. The Company's
management is responsible for preparing the consolidated financial statements,
and its independent registered public accountants are responsible for auditing
those consolidated financial statements. The Audit Committee's principal purpose
is to monitor these processes. In this context, the Audit Committee reviewed and
discussed the audited consolidated financial statements with management and the
independent registered public accountants. Management represented that the
Company's consolidated financial statements were prepared in accordance with
United States generally accepted accounting principles applied on a consistent
basis, and the Audit Committee has reviewed and discussed the quarterly and
annual earnings and consolidated financial statements with management and the
independent registered public accountants. The Audit Committee also discussed
with the independent auditors matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees), as
amended.
 
 The Audit
Committee discussed with the independent registered public accountants their
independence from the Company and its management, including the matters, if any,
in the written disclosures required by Independence Standards Board Standard No.
1 (Independence Discussions With Audit Committees) and received from the
independent registered public accountants. The Audit Committee also considered
whether the independent registered public accountant’s provision of audit and
non-audit services to the Company is compatible with maintaining the auditors'
independence. The Audit Committee discussed with the Company's independent
registered public accountants the overall scope and plans for their audit. The
Audit Committee met with the independent registered public accountants, with and
without management present, to discuss the results of their audit, the
evaluations of the Company's internal controls, disclosure controls and
procedures and the overall quality and integrity of the Company's financial
reporting. Based on the reviews and discussions referred to above, the Audit
Committee has recommended to the Board, and the Board has approved, that the
audited consolidated financial statements be included in the Company's Annual
Report on Form 10-K for the year ended June 30, 2008, for filing with the
Securities and Exchange Commission.
  49
 Members
of the Audit Committee
 
 Alan E.
Richards, Chairman
 Edward C.
Miller, Jr.
 Solange
Charas
 
 Governance
and Nominating Committee
  In Fiscal
2008, the members of the Committee were Mr. O’Neil and Mr. Richards. As the
Company is not listed on a national exchange it has determined to be guided by
the independence requirements of the American Stock Exchange (“AMEX”). See, Item
13, “Director Independence”, below. Using the AMEX rules as a guideline the
Company believes that each member of the Committee is independent. The
Governance and Nominating Committee, among other duties, determines the slate of
director candidates to be presented for election at the Company’s annual meeting
of shareholders.
  The
Company has adopted a nominating committee charter, a copy of which is available
on the Company’s Internet website, www.ableenergy.com.
The Governance and Nominating Committee’s process for recruiting and selecting
nominees is for the committee members to attempt to identify individuals who are
thought to have the business background and experience, industry specific
knowledge and general reputation and expertise that would allow them to
contribute as effective directors to the Company's governance, and who are
willing to serve as directors of a public company. To date, the Company has not
engaged any third party to assist in identifying or evaluating potential
nominees. After a possible candidate is identified, the individual meets with
various members of the Committee and is sounded out concerning their possible
interest and willingness to serve, and Governance and Nominating Committee
members discuss amongst themselves the individual's potential to be an effective
Board member. If the discussions and evaluation are positive, the individual is
invited to serve on the Board.
  As of
June 30, 2008, there were no material changes to the procedures by which
security holders may recommend nominees to the registrant’s board of
directors.
  To date, no
stockholder has presented any candidate for Board membership tothe Company
for consideration, and the Company, although it will consider nominees submitted
by stockholders, does not have a specific policy on stockholder-recommended
director candidates. However, the Governance and Nominating Committee believes
its process for evaluation of nominees proposed by stockholders would be no
different from the process of evaluating any other candidate.  In
evaluating candidates, the Committee will require that candidates possess, at a
minimum, a desire to serve on the Company's Board, an ability to contribute to
the effectiveness of the Board, an understanding of the function of the Board of
a public company and relevant industry knowledge and experience. In addition,
while not required of any one candidate, the Committee would consider favorably
experience, education, training or other expertise in business or financial
matters and prior experience serving on boards of public companies.
  The other
function of the Governance and Nominating Committee is to oversee the Company’s
compliance with the corporate governance requirements of the SEC and the NASDAQ
Marketplace Rules.
 
 Item
11. Executive Compensation
 
 Compensation
Discussion and Analysis
 
 The
objectives of the Company’s compensation programs are twofold: (i) to attract
and retain qualified and talented professional individuals to perform the duties
of the Company’s executive offices and (ii) to fairly reward the Company’s
executive officers for their overall performance in long term management of the
affairs of the Company.
 
 The
Compensation Committee's goal is to develop executive compensation policies that
offer competitive compensation opportunities for all executives which are based
on personal performances, individual initiative and achievement, as well as
assisting the Company in attracting and retaining qualified executives. The
Compensation Committee also endorses the position that stock ownership by
management and stock-based compensation arrangements are beneficial in aligning
management’s and stockholders’ interests in the enhancement of stockholder
value.
 
 50
 Compensation
paid to the Company's executive officers generally consists of the following
elements: base salary, annual bonus and long-term compensation in the form of
stock options and matching contributions under the Company’s 401(k) Savings
Plan. Compensation levels for executive officers of the Company was determined
by a consideration of each officer's initiative and contribution to overall
corporate performance and the officer's managerial abilities and performance in
any special projects that the officer may have undertaken. Competitive base
salaries that reflect the individual's level of responsibility are important
elements of the Compensation Committee's executive compensation philosophy.
Subjective considerations of individual performance are considered in
establishing annual bonuses and other incentive compensation. In addition, the
Compensation Committee considers the Company's financial position and cash flow
in making compensation decisions.
 
 The
Company has certain broad-based employee benefit plans in which all employees,
including the named executives, are permitted to participate on the same terms
and conditions relating to eligibility and subject to the same limitations on
amounts that may be contributed. During the year ended June 30, 2008, the Oil
Segment also made matching contributions to the 401(k) Savings Plan for its
employees.  While the Travel Plaza Segment’s 401(k) Savings Plan
provides for matching contributions at managements discretion, no such matching
contributions have been made since the inception of the plan in
2005.
 
 The
Company chooses to pay each element of compensation in order to best meet the
Company’s goal of attracting and retaining qualified and talented professional
individuals.   The salary component of the compensation is
important and the Company attempts to be competitive with what it believes to be
the compensation of other companies of similar size and scope of
operations.  To date, the Company has not engaged the services of a
compensation review consultant or service in view of the cost of such services
compared to the size and revenues of the Company.  The stock option
element of compensation is paid in order to provide additional compensation in
the long term commensurate with growth of the Company and increased share value
that may result from the performance of the executive receiving the
options.  The award of a bonus upon review of Company performance
provides an additional incentive.  The lack of other compensation
elements such as other insurance, retirement or retirement savings plans focuses
the importance of the salary and stock option elements of the Company’s
compensation plan.
 
 The
Company determines the amount (and, where applicable, the formula) for each
element to pay by reviewing annually the compensation levels of the Company’s
executive officers and determining from the performance of the Company during
that time since the last review what appropriate compensation levels may be
during the upcoming annual period. The Company has no existing formula for
determination of the salary, stock options or bonus elements of
compensation.
 
 Each
compensation element and the Company’s decisions regarding that element fit into
the Company’s overall compensation objectives and affect decisions regarding
other elements in this manner:  the salary and stock option elements
(being the significant elements of overall compensation) are intended to serve
primarily as current and long-term compensation respectively.  Review
of salary levels and consideration of bonus awards on an annual basis and
vesting of options over a forward period serve to allow the Company to attempt
to meet its objectives of attracting and maintaining qualified and talented
professional individuals in service as the Company’s executive
officers.
 
 Summary
Compensation Table
 
 The
following table sets forth certain summary information with respect to the
compensation paid to the Company's former Chief Executive Officer, current
Acting Chief Executive Officer, Chief Operating Officer and Chief Financial
Officer for services rendered in all capacities to the Company for the fiscal
years ended June 30, 2008 and 2007. Other than as listed below, the Company had
no executive officers whose total annual salary and bonus exceeded $100,000 for
that fiscal year:
  51
 
 Summary
Compensation Table
 
 Name
      and PrincipalPosition
              
              Year
              
              Salary
                ($)
              
              
              Bonus
                ($)
              
              
              Stock
                Awards
                ($)
              
              
              Option
      Awards
                ($)
              
              
              Non-equity
                incentive
                plan
      compensation ($)
              
              
              Nonqualified deferred
      compensation earnings ($)
              
              
              All
      Other
                Compensation
      ($)(1)
              
              
              Total
      ($)Gregory
      D. Frost,
              
              2008
              
              
              255,770
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              7,950
              (1)
              
              
              263,720Chief
      Executive Officer andDirector
      (2)
              
              2007
              
              
              254,808
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              7,701
              (1)
              
              
              262,509Christopher
      P. Westad,
              
              2008
              
              
              144,867
              
              
              
              --
              
              
              
              --
              
              
              
              -
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              144,867Vice
      President, Special Projects
              
              2007
              
              
              144,323
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              144,323John
      Vrabel,
              
              2008
              
              
              144,866
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              7,419
              (1)
              
              
              152,285Chief
      Operating Officer, PriceEnergy Unit
              
              2007
              
              
              144,323
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              6,708
              (1)
              
              
              151,131Frank
      Nocito,
              
              2008
              
              
              122,769
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              122,769Vice
      President of Business Development
              
              2007
              
              
              122,308
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              122,308William
      R. Roberts,
              
              2008
              
              
              109,946
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              5,581
              (1)
              
              
              115,527Chief
      Operating Officer
  Notes:
 (1)
              Represents
      car allowance and travel expense reimbursements pursuant to his employment
      agreement with the Company.
 (2)
              Mr.
      Frost served as Chief Executive Officer from August 13, 2005 to September
      28, 2006 and May 24, 2007 to
present.
 (3)
              Mr.
      Westad served as Acting Chief Financial Officer from June 23, 2006 to
      September 28, 2006.   Mr. Westad also served as Acting
      Chief Executive Officer from September 28, 2006 through May 24,
      2007.
  The
Summary Compensation Table above, together with the accompanying notes, provides
information sufficient to accurately reflect the payments to the officers named
in this table. With the exception of Mr. Frost, the Company’s CEO at the time of
the filing of this Annual Report, and Mr. Westad no written employment agreement
has been entered into with the Company’s officers which is in effect as of the
date of this Annual Report.  For additional information regarding the
employment agreements of Mr. Frost and Mr. Westad, please see the narrative
below under the heading “Employment Agreements” under this Item 11.  The
periods reflected on the Summary Compensation table
  52
  reflects
the commencement date of the year of employments.  Thus, the reference to
the year “2007” reflects the period July 1, 2007 to June 30, 2008.  Amounts
paid to the named executive officers reflect discretionary adjustments made by
the Company’s Board of Directors in order to adjust for cost-of-living increases
and are not payment based on bonus payments.  To the extent that payments
in the Summary Compensation Table reflect actual reimbursements to named
officers, the Company disclaims such portion as actual taxable compensation to
such officers, subject to withholding obligations.  The named executive
officers did not receive grants of any options or other incentive grants during
the stated terms. The Company does, however, maintain a stock option plan and
shares remain reserved for issuance under such plan.
 
 1.Grants of Plan-Based
Awards.
 
 Name
              Grant
      date
              Estimated
      future payouts under
                non-equity
      incentive plan
                awards
              Estimated
      future payouts under
                equity
      incentive plan awards
              All
      other
                stock
                awards:
                Number
      of shares of
                stock
      or
                units
                (#)
              All
      other option awards:
                Number
      of
                securities
                underlying
                options
                (#)
              Exercise
      or base price
                of
      option awards
                ($/Sh)
              Grant
      date
                fair
      value
                of
      stock
                and
      option awardsThreshold
                ($)
              Target
                ($)
              Maximum
                ($)
              Threshold
                (#)
              Target
                (#)
              Maximum
                (#)(a)
              (b)
              (c)
              (d)
              (e)
              (f)
              (g)
              (h)
              (i)
              (j)
              (k)
              (l)PEO
              
              --
              --
              --
              --
              --
              --
              --
              --
              --
              --PFO
              
              --
              --
              --
              --
              --
              --
              --
              --
              --
              --A
              
              --
              --
              --
              --
              --
              --
              --
              --
              --
              --B
              
              --
              --
              --
              --
              --
              --
              --
              --
              --
              --C
              
              --
              --
              --
              --
              --
              --
              --
              --
              --
              --
 
 No equity
or non-equity incentive plan awards or options were granted during fiscal year
2008 to the Company’s Chief Executive Officer, Chief Financial Officer or any of
the Company’s most highly compensated executive officers whose compensation
exceeded $100,000 for Fiscal 2008.
  2.Outstanding equity awards
at fiscal year-end table.
  Name
              Option
      awards
              Stock
      awardsNumber
      of securities underlying unexercised options
                (#)
                exercisable
              Number
      of securities underlying unexercised options
                (#)
                unexercisable
              Equity
                incentive
      plan awards:
                number
      of
                securities
                underlying
      unexercised unearned
                options
                (#)
              Option
                exercise
                price
                ($)
              Option
                expiration
                date
              Number
      of shares or units of
                stock
      that have not vested
                (#)
              Market
                value
      of shares or units of
                stock
      that have not vested
                (#)
              Equity
                incentive
      plan awards:
                number
      of unearned
                shares,
      units
                or
      other
                rights
      that
                have
      not
                vested
                (#)
              Equity
                incentive
      plan awards:
                market
      or
                payout
      value
                of
      unearned shares, units
                or
      other rights that have not vested
                ($)(a)
              (b)
              (c)
              (d)
              (e)
              (f)
              (g)
              (h)
              (i)
              (j)PEO
              --
              --
              --
              --
              --
              --
              --
              --
              --PFO
              --
              --
              --
              --
              --
              --
              --
              --
              --Christopher
      Westad
              15,000
              --
              --
              $2.55
              June
      30, 2009
              --
              --
              --
              --15,000
              
              
              $3.16
              June
      30, 2008B
              --
              --
              --
              --
              --
              --
              --
              --
              --C
              --
              --
              --
              --
              --
              --
              --
              --
              --
  53
  The
Company maintains an option plan for employees and has granted options in the
past as a means to incentivize certain employees.  The Company’s current
employee stock option plan is incorporated by reference under Exhibit 4.3 of the
Annual Report.  During this reporting period, no options have been granted
to any company employees.  The Board determined that it was not advisable
to issue any options during this period primarily because of market conditions
and the status of the Company’s current noncompliance with the reporting
requirements of the Securities Exchange Act of 1933, as amended.
  3.Option exercises and stock vested
table.
  Name
              Option
      awards
              Stock
      awardsNumber
      of shares
                acquired
      on
                exercise
                (#)
              Value
                realized
      on
                exercise
                ($)
              Number
      of shares
                acquired
      on vesting
                (#)
              Value
                realized
      on
                vesting
                ($)(a)
              (b)
              (c)
              (d)
              (e)PEO
              --
              --
              --
              --PFO
              --
              --
              --
              --A
              --
              --
              --
              --B
              --
              --
              --
              --C
              --
              --
              --
              --
  No option
exercises occurred or shares vested during fiscal year 2008 to the Company’s
Chief Executive Officer, Chief Financial Officer or any of the Company’s most
highly compensated executive officers whose compensation exceeded $100,000 for
Fiscal 2008.
  4.Pension
benefits.
  Name
              Plan
      name
              Number
      of years credited service
                (#)
              Present
      value of
                accumulated
      benefit
                ($)
              Payments
      during last fiscal year
                ($)(a)
              (b)
              (c)
              (d)
              (e)PEO
              --
              --
              --
              --PFO
              --
              --
              --
              --A
              --
              --
              --
              --B
              --
              --
              --
              --C
              --
              --
              --
              --
  There
were no pension plans in-place during fiscal year 2008 for the Company’s Chief
Executive Officer, Chief Financial Officer or any of the Company’s most highly
compensated executive officers whose compensation exceeded $100,000 for Fiscal
2008.
 54
  5.Nonqualified defined
contribution and other nonqualified deferred compensation plans.
  Name
              Executive
      contributions
                in
      last FY
                ($)
              Registrant
      contributions
                in
      last FY
                ($)
              Aggregate
      earnings
                in
      last FY
                ($)
              Aggregate
                withdrawals/distributions
                ($)
              Aggregate
      balance
                at
      last FYE
                ($)(a)
              (b)
              (c)
              (d)
              (e)
              (f)PEO
              --
              --
              --
              --
              --PFO
              --
              --
              --
              --
              --A
              --
              --
              --
              --
              --B
              --
              --
              --
              --
              --C
              --
              --
              --
              --
              --
 
 There
were no nonqualified
defined contribution and other nonqualified deferred compensation plans in place
during fiscal year 2008 for the Company’s Chief Executive Officer, Chief
Financial Officer or any of the Company’s most highly compensated executive
officers whose compensation exceeded $100,000 for Fiscal 2008.
  6.Director
Compensation.
  Name
              Fees
                Earned
      or
                Paid
      in
                Cash
      ($)
              Stock
                Awards
                ($)
              Option
                Awards
                ($)
              Non-equity
                incentive
      plan
                compensation
                ($)
              Nonqualified
                deferred
                compensation
                earnings
                ($)
              All
      Other Compens
                -ation
      ($)
              Total
      ($)Gregory
      D.Frost
              --
              --
              --
              --
              --
              --
              --Christopher
      P.Westad
              --
              --
              --
              --
              --
              --
              --PatrickO'Neill
              $27,000
              --
              $30,000
              --
              --
              --
              $57,000Edward
      C.Miller,
      Jr.
              $27,000
              --
              $30,000
              --
              --
              --
              $57,000StevenChalk
              -
              --
              -
              --
              --
              --
              --Alan
      E.Richards
              $34,500
              --
              $30,000
              --
              --
              --
              $64,500SolangeCharas
              $32,500
              --
              $30,000
              --
              --
              --
              $62,500
  Non-independent
directors and directors who are employed as executive officers receive no
additional compensation for service on the board.  All directors are
reimbursed for travel and other expenses relating to attendance at board and
committee meetings. Effective July 1, 2007, each non-employee independent
director is to receive an annual retainer of $27,000 (payable monthly), a $7,500
annual retainer for the Audit Committee Chairperson, a $5,500 annual retainer
for the Compensation Committee Chairperson and a $4,000 annual retainer for the
Governance/Nominating Committee Chairperson (presently vacant).  At
June 30, 2008, the above noted independent director fess were accrued but
unpaid.   Each committee member is also to receive an annual
grant of a ten-year option to purchase $3,000 worth of shares of the Company’s
common stock (“Committee Fee Options”).  In addition, all independent
directors received $30,000 worth (inclusive of the Committee Fee Options) of
shares of the Company’s common stock on June 29, 2007, applicable to the 2008
fiscal year, which was expensed in fiscal year 2007.
  55
 There are
no current disputes with any Board members regarding past fees or option
grants.
 
 EMPLOYMENT
ARRANGEMENTS
 
 Gregory
D. Frost, on October 12, 2005, entered into a one-year employment agreement, as
Chief Executive Officer of the Company at an annual salary of
$250,000.  The term of the agreement is automatically renewable and
has been renewed through October 11, 2009.  The annual salary is
subject to periodic increases at the discretion of the Board of
Directors.  Mr. Frost is entitled to bonuses pursuant to his
employment agreement if the Company meets certain financial targets based on
sales, profitability and the achievement of certain goals as established by the
Board of Directors or the Compensation Committee.  Such bonuses, plus
all other bonuses payable to the executive management of the Company, shall not
exceed in the aggregate, a "Bonus Pool" which shall equal up to 20% of the
Company's earnings before taxes (“EBT”), provided the Company achieves at least
$1,000,000 of EBT in such bonus year.  If the Company meets or exceeds
$1,000,000 of EBT for that fiscal year, then the executive shall be entitled to
20% of such Bonus Pool.  The employment agreement also provides for
reimbursement of reasonable business expenses.  In the event the
agreement is terminated by Mr. Frost for reason, or by the Company for other
than cause, death or disability, Mr. Frost shall receive a lump sum severance
payment of one year’s salary, and any unvested stock options shall be deemed to
have vested at the termination date.
 
 Christopher
P. Westad has a three-year employment agreement, effective through November 25,
2009, at an annual salary of $141,600.  The term of the agreement may
be extended by mutual consent of the Company and Mr. Westad, and the annual
salary is subject to periodic increases at the discretion of the Board of
Directors.  Mr. Westad is entitled to bonuses pursuant to his
employment agreements if the Company meets certain financial targets based on
sales, profitability and the achievement of certain goals as established by the
Board of Directors or the Compensation Committee. Such bonuses, plus all other
bonuses payable to the executive management of the Company, shall not exceed in
the aggregate, a "Bonus Pool" which shall equal up to 20% of the Company's
earnings before taxes (“EBT”), provided the Company achieves at least $1,000,000
of EBT in such bonus year.  If the Company meets or exceeds $1,000,000
of EBT for that fiscal year, then the executive shall be entitled to 20% of such
Bonus Pool.   The employment agreement also provides for
reimbursement of reasonable business expenses.  In the event the
agreement is terminated by Mr. Westad for reason, or by the Company for other
than cause, death or disability, Mr. Westad shall receive a lump sum severance
payment of one year’s salary, and any unvested stock options shall be deemed to
have vested at the termination date.
 
 John L.
Vrabel has a three-year employment agreement, effective through July 1, 2007, as
Chief Operating Officer of the Company at an annual salary of
$141,600.  The term of the agreement may be extended by mutual consent
of the Company and Mr. Vrabel, and the annual salary is subject to periodic
increases at the discretion of the Board of Directors.  Mr. Vrabel is
entitled to bonuses pursuant to his employment agreements if the Company meets
certain financial targets based on sales, profitability and the achievement of
certain goals as established by the Board of Directors or the Compensation
Committee. Such bonuses, plus all other bonuses payable to the executive
management of the Company, shall not exceed in the aggregate, a "Bonus Pool"
which shall equal up to 20% of the Company's earnings before taxes (“EBT”),
provided the Company achieves at least $1,000,000 of EBT in such bonus
year.  If the Company meets or exceeds $1,000,000 of EBT for that
fiscal year, then the executive shall be entitled to 20% of such Bonus
Pool.The
employment agreement also provides for reimbursement of reasonable business
expenses.  In the event the agreement is terminated by Mr. Vrabel for
reason, or by the Company for other than cause, death or disability, Mr. Vrabel
shall receive a lump sum severance payment of one year’s salary, and any
unvested stock options shall be deemed to have vested at the termination date.
While the term of the employment agreement was allowed to expire on July 1,
2007, Mr. Vrabel remains an employee of the Company.
 
 COMPENSATION
COMMITTEE
 
 The
members of the Compensation Committee are Solange Charas and Patrick O'Neill
with Ms. Solange acting as Chairperson. The Company believes that both Ms.
Charas and Mr. Richards meet the applicable independence requirements. The
Compensation Committee has the authority to fix the Company's compensation
arrangements with the Chief Executive Officer, Chief Operating Officer and the
Chief Financial Officer and has the exclusive authority to grant options and
make awards under the Company's equity compensation plans.Although the Committee may
seek the input of the Company’s Chief Executive Officer in determining the
compensation of the Company’s other executive officers, the Chief Executive
Officer may not be present during the voting or deliberations with respect to
his compensation.  Consistent with the Delaware General Corporation
Law, the Compensation Committee, from time to time, delegates to the Company's
Chief Executive, Chief Operating Officer and the Chief Financial Officer the
authority to grant a specified number of options to non-executive officers. The
Compensation Committee also reviews the Company's compensation policies relating
to all executive officers.
 
 56
 
 Compensation Committee Interlocking
And Insider Participation
 
 No
interlocking relationship existed or exists between any member of the Company's
Compensation Committee and any member of the compensation committee of any other
company, nor has any such interlocking relationship existed in the past. No
member or nominee of the Compensation Option Committee is an officer or an
employee of the Company.
 
 Compensation
Committee Report
 
 The
Compensation Committee has reviewed and discussed the Compensation Discussion
and Analysis set forth below under the heading “Executive Compensation –
Compensation Discussion and Analysis” with management. Based on this review and
discussion, the Compensation Committee recommendedto the Company’s Board
of Directors that the Compensation Discussion and Analysis be included in this
Annual Report on Form 10-K for the fiscal year ended June 30, 2008.
  The Members of the
      Compensation CommitteeSolange Charas,
      ChairpersonPatrick
      O’Neil
  Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
 
 The
following table shows, as of June 30, 2008, the amount of the Company’s common
stock beneficially owned (unless otherwise indicated) by (i) each person known
by the Company to own 5% or more of the Company’s stock, (ii) each Director,
(iii) each executive officer named in the Summary Compensation Tablein Item 11 above and
(iv) all Directors and executive officers as a group.
 
 Name and Address*
              
              Aggregate
      Number of
                Shares
      Beneficially
                Owned (1)
              
              
              
              Percent
      of Class
                Outstanding (2)Gregory
      D. Frost
              
              
              -
              
              
              (3
              )(10)
              
              
              -
              %Frank
      Nocito
              
              
              11,001,113
              
              
              (5
              )
              
              
              73.5
              %Christopher
      P. Westad
              
              
              35,000
              
              
              (4
              )
              
              
              **Solange
      Charas
              
              
              85,260
              
              
              (8
              )
              
              
              0.1
              %Alan
      E. Richards
              
              
              85,260
              
              
              (8
              )
              
              
              0.1
              %Stephen
      Chalk
              
              
              3,000
              
              
              (8
              )
              
              
              **Edward
      C. Miller, Jr.
              
              
              85,260
              
              
              (8
              )
              
              
              0.1
              %Patrick
      O'Neill
              
              
              85,260
              
              
              (8
              )
              
              
              0.1
              %John
      L.Vrabel
              
              
              2,300
              
              
              (6
              )
              
              
              **Daniel
      L. Johnston
              
              
              100
              
              
              (11
              )
              
              
              **All
      American Properties, Inc.
              
              
              -
              
              
              (9
              )(10)
              
              
              -
              %Officers
      and Directors as a Group (9 persons)
              
              
              11,382,553
              
              
              (7
              )
              
              
              76.0
              %
 
 *
              Unless
      otherwise indicated, the address for each stockholder is c/o Able Energy,
      Inc., 198 Green Pond Road, Rockaway,
      New Jersey 07866.
 **
              Represents
      less than 1% of the outstanding common
  stock.
 
  Notes:
 (1)
              The
      number of shares of common stock beneficially owned by each stockholder is
      determined under rules promulgated by the SEC.  Under these
      rules, a person is deemed to have “beneficial ownership” of any shares
      over which that person has or shares voting or investing power, plus any
      shares that the person has the right to acquire within 60 days, including
      through the exercise of stock options.  To our knowledge, unless
      otherwise indicated, all of the persons listed above have sole voting and
      investment power with respect to their shares of common stock, except to
      the extent authority is shared by spouses under applicable
      law.
  57
  (2)
              The
      percentage ownership for each stockholder is calculated by dividing (a)
      the total number of shares beneficially owned by the stockholder on June
      30, 2008 by (b) 14,965,389 shares (the number of shares of our common
      stock outstanding on June 30, 2008), plus any shares that the stockholder
      has the right to acquire within 60 days after June 30,
    2008.
 
 (3)
              Includes
      11,001,113 shares owned by All American Properties, Inc.
      (“Properties”), of which Mr. Frost disclaims beneficial
      ownership.  Approximately 85% of the outstanding common stock of
      Properties is beneficially held by the Chelednik Family
      Trust.  In addition, pursuant to an agreement between Mr. Frost
      and the Chelednik Family Trust, Mr. Frost, through Crystal Heights, LLC,
      an entity controlled by Mr. Frost and his wife, is the beneficial holder
      of the balance of the outstanding common stock of
      Properties.  See Note (9)
below.
 
 (4)
              Includes
      5,000 shares owned outright and 30,000 shares, which may be acquired upon
      the exercise of outstanding stock
options.
 
 (5)
              Includes
      11,001,113 shares of Properties, of which Mr. Nocito disclaims beneficial
      ownership.  Mr. Nocito is Vice President of Properties, and
      approximately 85% of the outstanding common stock of Properties, is
      beneficially held by the Chelednik Family Trust, a trust established by
      Mr. Nocito and his wife for the benefit of their family
      members.  See Note (9),
below.
 
 (6)
              Includes
      2,300 shares owned outright.
 
 (7)
              Includes
      7,300 shares owned by the officers and directors and 54,000 shares, which
      may be obtained upon the exercise of outstanding options held by the
      officers and directors.  Also includes 11,001,113 shares owned
      by Properties of which Messrs. Frost and Nocito disclaim beneficial
      ownership.  See Note (9)
below.
 
 (8)
              Shares
      which may be acquired pursuant to currently exercisable stock options (or
      options that will become exercisable within sixty (60) days of June 30,
      2008).
 
 (9)
              Includes
      11,001,113 shares owned by Properties.  Approximately 85% of the
      outstanding common stock of Properties is beneficially held by the
      Chelednik Family Trust, a trust established by Mr. Nocito and his wife for
      the benefit of their family members.  In addition, pursuant to
      an agreement between Mr. Frost and the Chelednik Family Trust, Mr. Frost,
      through Crystal Heights, LLC an entity controlled by Mr. Frost and his
      wife, is the beneficial owner of the balance of the outstanding common
      stock of Properties.
 
 (10)
                Gregory
      D. Frost and Properties are also beneficial owners of the 11,001,113
      shares beneficially owned by Frank
Nocito.
 
 (11)
                Includes
      100 shares owned outright.
 
 EQUITY
COMPENSATION PLAN INFORMATION
 
 The following table sets forth the
information regarding the Company’s equity compensation plans as of June 30,
2008:
  58
  Plan
      Category
              
              Number
      of securities to
                be
      issued upon exercise
                of
      outstanding options,
                warrants
      and rights
              
              
              Weighted-average
                exercise
      price of
                outstanding
      options,
                warrants
      and rights
              
              
              Number
      of securities
                remaining
      available for
                future
      issuance under
                equity
      compensation
                plans
      (excluding
                securities
      reflected in
                column
      (a))(a)
              
              
              (b)
              
              
              (c)Equity
      compensationplans
      not
                approvedby
      security holders
              
              
              -0-
              
              
              Not
      applicable
              
              
              
              -0-Equity
      compensationplans
                approved
      bysecurity
      holders (1)
              
              
              30,000
              
              
              $2.86
              
              
              
              1,833,750Total
              
              
              30,000
              
              
              $2.86
              
              
              
              1,833,750
 
 (1)
Includes the 1999 Employee Stock Option Plan, the 2000 Stock Bonus Plan, the
2000 Employee Stock Purchase Plan and the 2005 Stock Option Plan.
 
 Item
13. Certain Relationships and Related Transactions, and Director
Independence
 
 Except as
set forth hereafter, there have been no material transactions, series of similar
transactions or currently proposed transactions during 2007 and 2008, to which
the Company or any of its subsidiaries was or is to be a party, in which the
amount involved exceeds the lesser of $120,000 or one percent of the average of
the Company’s total assets at year-end for its last two completed fiscal years
in which any director or executive officer or any security holder who is known
to the Company to own of record or beneficially more than 5% of the Company's
common stock, or any member of the immediate family of any of the foregoing
persons, had a material interest.
 
 Business
Combination with Properties
 
 We
entered into an asset purchase agreement with All American Plazas, Inc., now
known as All American Properties, Inc. (“Properties”) in June 2005, pursuant to
which we agreed to acquire substantially all of Properties assets and assume all
liabilities of Properties other than mortgage debt liabilities.  In
exchange for these assets, we issued Properties 11,666,667 restricted
shares of our common stock.  Our stockholders approved this
transaction with Properties at a special meeting held on August 29, 2006, and
the transaction closed on May 30, 2007.  The acquisition was completed
upon the Company’s issuance of 11.7 million shares of common stock at $1.65 per
share for total consideration of $19.3 million.
 
 Properties
currently own approximately 74% of our outstanding
shares.  Approximately 85% of the outstanding stock of Properties is
beneficially held by the Chelednik Family Trust by Mr. Frank Nocito, our
Executive Vice-President of Business Development, and his wife, Sharon
Chelednik, for the benefit of their family members.  Mr. Nocito is
also President of Properties.  In addition, pursuant to an agreement
between the Chelednik Family Trust and Gregory Frost, our Chief Executive
Officer ("CEO") and Chairman of our Board of Directors, through an entity
controlled by him (Crystal Heights, LLC), is also the beneficial holder of the
balance of the outstanding common stock of Properties.
 
 Consulting
Agreement
 
 On August
27, 2007 the Company’s subsidiary, PriceEnergy.com, Inc., entered into a service
agreement with Axis Consulting Services, LLC. The agreement calls for Axis
Consulting to develop marketing plan (phase 1) and manage (phase 2) “The Energy
Store” (an e-commerce retail sales portal for energy products and services).
During phase 1, the terms are $2,750 per month and once phase 2 commences an
amount of $5,600 per month. This agreement ends on December 31,
2008.  Axis Consulting’s President (Joe Nocito) has a direct
relationship as the son of the Company’s Executive Vice-President Frank
Nocito.
  59
 Director
Independence
 
 As the
Company is not listed on a national exchange it has determined to be guided by
the independence requirements of the American Stock Exchange (“AMEX”). The Board
of Directors has determined that four of six director, Solange Charas, Edward C.
Miller, Jr., Patrick O’Neil and Alan E. Richards, are independent as defined by
the listing standards of the AMEX, Section 10A(m)(3) of the Securities Exchange
Act of 1934 and the rules and regulations of the Securities and Exchange
Commission. In reaching its determination, the Board of Directors reviewed
certain categorical independence standards to provide assistance in the
determination of director independence. The categorical standards are set forth
below and provide that a director will not qualify as an independent director
under the Rules of the AMEX if:
 
 ·
              The
      Director is, or has been during the last three years, an employee or an
      officer of the Company or any of its
affiliates;
 
 ·
              The
      Director has received, or has an immediate family member1 who has received, during any twelve
      consecutive months in the last three years any compensation from the
      Company in excess of $100,000, other than compensation for service on the
      Board of Directors, compensation to an immediate family member who is an
      employee other than an executive officer, benefits under a tax-qualified
      retirement plan or non-discretionary
  compensation;
 
 ·
              The
      Director is a member of the immediate family of an individual who is, or
      has been in any of the past three years, employed by the Company or any of
      its affiliates as an executive
officer;
 
 ·
              The
      Director, or an immediate family member, is a partner in, or controlling
      shareholder or an executive officer of, any for-profit business
      organization to which the Company made, or received, payments (other than
      those arising solely from investments in the Company’s securities) that
      exceed 5% of the Company’s or business organization’s consolidated gross
      revenues for that year, or $200,000, whichever is more, in any of the past
      three years;
 
 ·
              The
      Director, or an immediate family member, is employed as an executive
      officer of another entity where at any time during the most recent three
      fiscal years any of the Company’s executives serve on that entity’s
      compensation committee; or
 
 ·
              The
      Director, or an immediate family member, is a current partner of the
      Company’s outside auditors, or was a partner or employee of the Company’s
      outside auditors who worked on the Company’s audit at any time during the
      past three years.
 
 The
following additional categorical standards were employed by the Board in
determining whether a director qualified as independent to serve on the Audit
Committee and provide that a director will not qualify if:
 
 ·
              The
      Director directly or indirectly accepts any consulting, advisory, or other
      compensatory fee from the Company or any of its subsidiaries;
      or
 
 ·
              The
      Director is an affiliated person of the Company or any of its
      subsidiaries.
 
 Item
14. Principal Accounting Fees and Services
 
 The
following table presents fees for professional services rendered by the
independent public accounting firms of Lazar, Levine & Felix, LLP, and
Simontacchi & Company, LLP for the Company during the years ended June 30,
2008 and 2007.
 
 For the Year Ended June 30,2008
              
              
              2007Audit
      Fees (1)
              
              $
              695,535
              
              
              $
              618,024Audit-Related
      Fees (2)
              
              
              -
              
              
              
              -Tax
      Fees (3)
              
              
              24,250
              
              
              
              4,350All
      Other Fees (4)
              
              
              6,460
              
              
              
              22,830Total
              
              $
              726,245
              
              
              $
              645,204
   1              
Under these categorical standards “immediate family member” includes a person’s
spouse, parents, children, siblings, mother-in-law, father-in-law,
brother-in-law, sister-in-law, son-in-law, daughter-in-law and anyone who
resides in such person’s home.
  60
  (1)
              These
      are fees for professional services performed for the audit of the
      Company’s annual consolidated financial statements and services that are
      normally provided in connection with statutory and regulatory filings or
      engagements.
 (2)
              These
      are fees for assurance and related services by the principal accountants
      that are reasonably related to the performance of the audit or review of
      the Company’s financial statements.
 (3)
              Principally
      fees for preparation of the Company’s federal and state corporate tax
      returns.
 (4)
              Principally
      fees for SEC inquiries.
 
 The Audit
Committee reviews and pre-approves all audit, review or attest engagements of,
and non-audit services to be provided by, the independent registered public
accounting firm (other than with respect to the de minimis exception permitted
by the Sarbanes-Oxley Act of 2002 and the SEC rules promulgated
thereunder).  The Audit Committee pre-approved all auditing services
and permitted non-audit services rendered by Lazar, Levine & Felix, LLP, and
Simontacchi & Company, LLPfor the years ended June
30, 2008 and 2007.
 
 61
  PART
IV
 
 Item
15. Exhibits and Financial Statement Schedules
 
 EXHIBITS
 
 The
following Exhibits are filed as part of this Report:
  Exhibit
                Number
              Description3.1
              Articles
      of Incorporation of Registrant (incorporated herein by reference to
      Exhibit 3.1 to the Company’s Registration Statement on Form SB-2, SEC File
      No. Number 333-51909, filed with the Securities and Exchange Commission
      (“SEC”) on July 15, 1998 (the “1998 Form
  SB-2”)).
 
 3.2
                By-Laws
      of Registrant (incorporated herein by reference to Exhibit 3.2 to the 1998
      Form SB-2).
 
 3.3
                Certificate
      of Amendment to the Certificate of Amendment of Registrant dated May 30,
      2007 (incorporated herein by reference to Exhibit 99.1 to the Company’s
      Current Report on Form 8-K dated May 24, 2007, filed with the SEC on May
      30, 2007).
 
 4.1
                Specimen
      Common Stock Certificate (incorporated herein by reference to Exhibit 4.21
      to Amendment No. 3 to the Company’s Registration Statement on Form SB-2,
      SEC File No. Number 333-51909, filed with the SEC on May 17, 1999 (the
      “Amendment No. 3 to the 1998 Form
SB-2”)).
 
 4.2
              Able
      Energy, Inc. 2000 Employee Stock Purchase Plan (incorporated herein by
      reference to the Company’s Definitive Proxy Statement on Schedule 14A
      filed with the SEC on May 30,
2000).
  4.3
              Able
      Energy, Inc. 2005 Incentive Stock Plan (incorporated herein by reference
      to Exhibit 4.1 to the Company’s Current Report on Form 8-K. dated May 25,
      2005, filed with the SEC on June 1, 2005 (the “May 2005 Form
      8-K”)).
 
 4.4
                Form
      of Incentive Stock Option Agreement (incorporated herein by reference to
      Exhibit 10.1 to the May 2005 Form
8-K).
 
 4.5
                Form
      of Employee Nonstatutory Stock Option Agreement (incorporated herein by
      reference to Exhibit 10.2 to the May 2005 Form
  8-K).
 
 4.6
                Form
      of Nonstatutory Stock Option Agreement (incorporated herein by reference
      to Exhibit 10.3 to the May 2005 Form
8-K).
 
 4.7
                Form
      of Consultant Nonstatutory Stock Option Agreement (incorporated herein by
      reference to Exhibit 10.4 to the May 2005 Form
  8-K).
 
 4.8
                Form
      of Stock Award Agreement (incorporated herein by reference to Exhibit 10.5
      to the May 2005 Form 8-K).
 
 4.9
                Form
      of Restricted Stock Purchase Agreement (incorporated herein by reference
      to Exhibit 10.6 to the May 2005 Form
8-K).
 
 4.10
                Form
      of Secured Debenture, made as of June 1, 2005, by All American Plazas,
      Inc., Yosemite Development Corp. and Mountainside Development, LLC in
      favor of the Purchasers named therein (incorporated herein by reference to
      Exhibit 99.2 to the Company’s Current Report on Form 8-K, dated June 7,
      2005, filed with the SEC on June 10, 2005 (the “June 2005 Form
      8-K”)).
 
 4.11
                Additional
      Investment Right (incorporated herein by reference to Exhibit 99.3 to the
      June 2005 Form 8-K).
  62
  4.12
                Form
      of Registration Rights Agreement by and among the Purchasers named therein
      and the Company (incorporated herein by reference to Exhibit 99.5 to the
      June 2005 Form 8-K).
 
 4.13
                Form
      of Common Stock Purchase Warrant Agreement (incorporated herein by
      reference to Exhibit 99.6 to the June 2005 Form
  8-K).
 
 4.14
              Form
      of Variable Rate Secured Convertible Debenture made by the Company in
      favor of the holder thereof (incorporated herein by reference to Exhibit
      99.7 to the June 2005 Form 8-K).
 
 4.15
              Warrant
      Agreement between the Company and Continental Stock Transfer & Trust
      Company (incorporated herein by reference to Exhibit 4.2 to the 1998 Form
      SB-2).
 
 4.16
              Able
      Energy, Inc. 2000 Employee Stock Bonus Plan (incorporated herein by
      reference to the Company’s Definitive Proxy Statement on Schedule 14A
      filed with the SEC on May 30,
2000).
 
 4.17
              Form
      of Variable Rate Convertible Debenture, dated July 12, 2005, made by the
      Company in favor of the holder thereof (incorporated herein by reference
      to Exhibit 99.2 to the Company’s Current Report on Form 8-K, dated July
      14, 2005, filed with the SEC on July 15, 2005 (the “July 2005 Form
      8-K”)).
 
 4.18
              Form
      of Registration Rights Agreement, dated as of July 12, 2005, by and among
      the Company and the purchasers signatory thereto (incorporated herein by
      reference to Exhibit 99.3 to the July 2005 Form
  8-K).
 
 4.19
              Form
      of Common Stock Purchase Warrant Agreement (incorporated herein by
      reference to Exhibit 99.4 to the July 2005 Form
  8-K).
 
 4.20
              Subscription
      Agreement, dated as of September 30, 2005, between the Company and the
      holder of a promissory note, dated February 22, 2005, issued to the
      Subscriber by the Company (incorporated herein by reference to Exhibit
      10.7 to the 2005 First Quarter Form
10-Q).
 
 4.21
              Form
      of Secured Debenture, dated January 20, 2006, made by All American in
      favor of the Purchasers (incorporated herein by reference to Exhibit 99.2
      to the Company’s Current Report on Form 8-K, dated January 20, 2006, filed
      with the SEC on January 23, 2006 (the “January 2006 Form
      8-K”)).
 
 4.22
              Form
      of Additional Investment Right (incorporated herein by reference to
      Exhibit 99.3 to the January 2006 Form
8-K).
 
 4.23
              Common
      Stock Purchase Warrant, dated June 30, 2006, issued by Able Energy, Inc.
      to Laurus Master Fund, Ltd. (incorporated herein by reference to Exhibit
      10.3 to the Current Report on Form 8-K, dated June 30, 2006, filed with
      the SEC on July 7, 2006 (the “June 2006 Form
  8-K”)).
 
 4.24
              Convertible
      Term Note, dated June 30, 2006, made by Able Energy, Inc. in favor of
      Laurus Master Fund, Ltd. (incorporated herein by reference to Exhibit 10.2
      to the June 2006 Form 8-K).
 
 4.25
              Registration
      Rights Agreement, dated June 30, 2006, between Able Energy, Inc. and
      Laurus Master Fund, Ltd. (incorporated herein by reference to Exhibit 10.4
      to the June 2006 Form 8-K).
 
 4.26
              Form
      of Variable Rate Secured Debenture (incorporated herein by reference to
      Exhibit 4.1 to the Current Report on Form 8-K, dated August 8, 2006, filed
      with the SEC on August 14, 2006 (the “August 2006 Form
    8-K”)).
 
 4.27
              Registration
      Rights Agreement, dated as of August 8, 2006, by and among the Company and
      the Purchasers named therein (incorporated herein by reference to Exhibit
      4.2 to the August 2006 Form 8-K).
 
 4.28
              Form
      of Common Stock Purchase Warrant (incorporated herein by reference to
      Exhibit 4.3 to the August 2006 Form
8-K).
  63
  10.1
              Lease
      of Company's Facility at 344 Route 46, Rockaway, New Jersey (incorporated
      herein by reference to Exhibit 10.3 to the 1998 Form
  SB-2).
 
 10.2
              Loan
      and Security Agreement, dated as of May 13, 2005, between the Company,
      Able Oil Company, Able Energy New York, Inc. Able Oil Melbourne, Inc.,
      Able Energy Terminal, LLC and Able Propane, LLC (as borrowers) and
      Entrepreneur Growth Capital, LLC (incorporated herein by reference to
      Exhibit 10.26 to the Company’s Annual Report on Form 10-K for the year
      ended June 30, 2005 (the “2005 Form
10-K”)).
 
 10.3
              Promissory
      Note, dated May 13, 2005, made by the Company in favor of Northfield
      Savings Bank, (incorporated herein by reference to Exhibit 10.27 to the
      2005 Form 10-K).
 
 10.4
              Securities
      Purchase Agreement, by and among All American Plazas, Inc., dated as of
      June 1, 2005 (incorporated herein by reference to Exhibit 99.1 to the June
      2005 Form 8-K).
 
 10.5
              Form
      of Securities Assumption, Amendment and Issuance Agreement by and among
      the Purchasers named therein and the Company (incorporated herein by
      reference to Exhibit 99.4 to the June 2005 Form
  8-K).
 
 10.6
              Stock
      Purchase Agreement, by and between the Sellers named therein and the
      Company, dated as of June 16, 2005 (incorporated herein by reference to
      Exhibit 10.1 to the Company’s Current Report on Form 8-K, dated June 16,
      2005, filed with the SEC on June 16,
2005).
 
 10.7
              1999
      Employee Stock Option Plan (incorporated herein by reference to Exhibit
      10.2 to Amendment No. 2 to the 1998 Form
  SB-2).
 
 10.8
              Asset
      Purchase Agreement, dated March 1, 2004, by and among the Company, Able
      Propane Co., LLC, Christopher Westad, and Timothy Harrington, Liberty
      Propane, L.P. and Action Gas Propane Operations, LLC (incorporated herein
      by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K,
      dated March 16, 2004, filed with the SEC on March 16,
    2004).
 
 10.13
              Asset
      Purchase Agreement between the Company and All American Plazas, Inc dated
      as of June 16, 2005 (incorporated by reference to Annex A to the Company’s
      Definitive Proxy Statement on Schedule 14A filed with the SEC on July 28,
      2006).
 
 10.14
                Securities
      Purchase Agreement, dated as of July 12, 2005, among the Company and the
      purchasers signatory thereto (incorporated herein by reference to Exhibit
      99.1 to the July 2005 Form
8-K).
 
 10.15
              Employment
      Agreement, dated as of October 13, 2005, between the Company and Gregory
      D. Frost (incorporated herein by reference to Exhibit 99.1 to the
      Company’s Current Report on Form 8-K, dated October 13, 2005, filed with
      the SEC on October 19, 2005).
 
 10.16
              Amendment
      Agreement, dated as of November 16, 2005, by and among the Company and the
      holders signatory thereto (incorporated herein by reference to Exhibit
      99.1 to the Company’s Current Report on Form 8-K, dated November 14, 2005,
      filed with the SEC on November 18,
2005).
 
 10.17
              Securities
      Purchase Agreement, by and among All American and the Purchasers, dated as
      of January 20, 2005 (incorporated herein by reference to Exhibit 99.1 to
      the January 2006 Form 8-K).
 
 10.18
              Form
      of Security Agreement, dated as of January 20, 2006, by and between St.
      John's Realty Corporation and Lilac Ventures Master Fund, Ltd., as agent
      for the Secured Parties listed therein (incorporated herein by reference
      to Exhibit 99.4 to the January 2006 Form
8-K).
 
 10.19
              Loan
      Agreement, dated as of January 20, 2006, by and between All American
      Plazas, Inc., St. John's Realty Corporation, Lilac Master Ventures Fund,
      Ltd. and the Purchasers listed there (incorporated herein by reference to
      Exhibit 99.5 to the January 2006 Form
8-K).
 
 10.20
              Securities
      Purchase Agreement between Able Energy, Inc. and Laurus Master Fund, Ltd.
      dated June 30, 2006 (incorporated herein by reference to Exhibit 10.1 to
      the June 2006 Form 8-K).
  64
  10.21
              Subsidiary
      Guaranty dated June 30, 2006 of Able Oil Co., Able Propane Co, LLC, Able
      Energy New York, Inc., Abel Oil Melbourne, Inc., Able Energy Terminal,
      Inc., Priceenergy.com, Inc. and Priceenergy.com and Franchising, LLC
      (incorporated herein by reference to Exhibit 10.5 to the June 2006 Form
      8-K).
 
 10.22
              Securities
      Purchase Agreement, dated as of August 8, 2006, by and among the Company
      and the Purchasers (incorporated herein by reference to Exhibit 10.1 to
      the August 2006 Form 8-K).
 
 10.23
              Security
      Agreement, dated as of August 8, 2006, by and among the Company, the
      Company's subsidiaries and the Purchasers (incorporated herein by
      reference to Exhibit 10.2 to the August 2006 Form
  8-K).
 
 10.24
              Account
      Purchase Agreement between All American Plazas, Inc. and Crown Financial,
      LLC dated January 8, 2007 (incorporated herein by reference to Exhibit
      10.25 to the Company’s Quarterly Report on Form 10-Q for the Quarter ended
      September 30, 2008 (the “September 30, 2007 Form
  10-Q”)).
 
 10.25
              Account
      Purchase Agreement Modification between All American Plazas, Inc. and
      Crown Financial, LLC dated June 29, 2007 effective July 1, 2007
      (incorporated herein by reference to Exhibit 10.26 to the September 30,
      2007 Form 10-Q).
 
 10.26
              Receivables
      Financing Agreement between All American Plazas, Inc. and Credit Cash, LLC
      dated July 16, 2007 (incorporated herein by reference to Exhibit 10.27 to
      the September 30, 2007 Form 10-Q).
 
 10.27
              Consulting
      Agreement between PriceEnergy.com, Inc. and Axis Consulting Services dated
      August 27, 2007 (incorporated herein by reference to Exhibit 10.28 to the
      September 30, 2007 10-Q).
 
 10.28
              Fuel
      Financing agreement dated October 17, 2007 between the Company and S&S
      NY Holdings Inc together with First Amendment thereto dated February 5,
      2007 (incorporated herein by reference to Exhibit 10.29 to the
      Company’s Quarterly Report on Form 10-Q for the Quarter ended December 31,
      2008 (the “December 31, 2007 Form
10-Q”)).
 
 10.29
              Credit
      Card Receivables Purchase Agreement between All American Plazas, Inc and
      Credit Cash, LLC dated November 2, 2007  (incorporated herein by
      reference to Exhibit 10.30 to the December 31, 2007 Form
      10-Q).
 
 10.30
              Credit
      Card Receivables Advance Agreement between Able Oil Company and Credit
      Cash, LLC dated November 7, 2007  (incorporated herein by
      reference to Exhibit 10.31 to the December 31, 2007
  10-Q).
 
 10.31
              Credit
      Card Receivables Advance Agreement between PriceEnergy.com Inc and Credit
      Cash, LLC dated November 7, 2007  (incorporated herein by
      reference to Exhibit 10.32 to the December 31, 2007 Form
      10-Q).
 
 10.32
              Amended
      and Restated Note Agreement dates as of November 30, 2007 between the
      Company, All American Plazas, Inc. All American Properties, Inc and
      TransMontaigne Product Services Inc.  (incorporated herein by
      reference to Exhibit 10.33 to the December 31, 2007 Form
      10-Q).
 
 10.33
              Fuel
      Financing Agreement dated December 20, 2007 between the Company and
      S&S NY Holdings Inc.  (incorporated herein by reference to
      Exhibit 10.34 to the December 31, 2007 Form
  10-Q).
 
 10.34
              Over
      Advance Agreement between the Company, Able Oil Company, Able Energy New
      York, Inc., Able Energy Terminal, LLC, Able Propane, LLC and Entrepreneur
      Growth Capital, LLC dated December 28, 2007  (incorporated
      herein by reference to Exhibit 10.35 to the December 31, 2007 Form
      10-Q).
 
 10.35
              Consulting
      Agreement between Hammond Associates, LLC and the Company dated January
      11, 2008 (incorporated herein by reference to Exhibit 10.36 to the
      Company’s Quarterly Report on Form 10-Q for the Quarter ended March 31,
      2008 (the “March 31, 2008 Form
10-Q”)).
  65
  10.36
              Credit
      Card Receivables Purchase Agreement between All American Plazas, Inc. and
      Credit Cash, LLC dated January 18, 2008 (incorporated herein by reference
      to Exhibit 10.37 to the March 31, 2008 Form
  10-Q).
 
 10.37
              Credit
      Card Receivables Advance Agreement between Able Oil Company and Credit
      Cash, LLC dated January 18, 2008 (incorporated herein by reference to
      Exhibit 10.38 to the March 31, 2008 Form
10-Q).
 
 10.38
              Over
      Advance Agreement between the Company, Able Oil Company, Able Energy New
      York, Inc., Able Energy Terminal, LLC, Able Propane, LLC and Entrepreneur
      Growth Capital, LLC dated February 11, 2008 (incorporated herein by
      reference to Exhibit 10.39 to the March 31, 2008 Form
    10-Q).
 
 10.39
              Credit
      Card Receivables Advance Agreement between PriceEnergy.com, Inc. and
      Credit Cash, LLC dated February 14, 2008 (incorporated herein by reference
      to Exhibit 10.40 to the March 31, 2008 Form
  10-Q).
 
 10.40
              Fuel
      Purchase Loan between Able Energy, Inc., Able Oil Company, Able Energy New
      York, Inc., Able Energy Terminal, LLC, Able Propane, LLC and Entrepreneur
      Growth Capital, LLC dated February 25, 2008 (incorporated herein by
      reference to Exhibit 10.41 to the March 31, 2008
  10-Q).
 
 10.41
              Asset
      Purchase Agreement between Able Oil Melbourne, Inc., Able Energy, Inc. and
      Able Oil of Brevard, Inc. dated February 8, 2008 (incorporated herein by
      reference to Exhibit 10.42 to the March 31, 2008 Form
    10-Q).
 
 10.42
              Credit
      Card Receivables Purchase Agreement between Able Oil Company and Credit
      Cash, LLC dated April 11, 2008.*
 
 10.43
              Credit
      Card Receivables Purchase Agreement between PriceEnergy.com, Inc. and
      Credit Cash, LLC dated April 11,
2008.*
 
 10.44
              Fuel
      Supply Agreement between the Company and Atlantis Petroleum, LLC dated May
      8, 2008.*
 
 10.45
              Contract
      of Sale between All American Properties, Inc., All American Plazas, Inc.
      and T.S. O., Inc. dated May 12,
2008*
  14.1
              Code
      of Business Conduct and Ethics (incorporated herein by reference to
      Appendix C to the Company’s Definitive Proxy Statement on Schedule 14A
      filed with the SEC on June 17,
2004).
 
 16.1
              Letter
      to SEC from Simontacchi & Company, LLP, dated January 9, 2006
      (incorporated herein by reference to Exhibit 16.1 to the Company’s Current
      Report on Form 8-K, dated January 4, 2006, filed with the SEC on January
      9, 2006).
 
 16.2
              Letter
      to SEC from Simontacchi & Company, LLP, dated July 26, 2006
      (incorporated herein by reference to Exhibit 16.2 to Amendment No. 2 on
      Form 8-K/A to the Company’s Current Report on Form 8-K, dated January 4,
      2006, filed with the SEC July 26,
2006).
 
 21.1
              List
      of Subsidiaries of Registrant (incorporated herein by reference to Exhibit
      21.1 to the Company’s Annual Report on Form 10-K for the year ended June
      30, 2007).
 
 31.1
              Certification
      by Chief Executive Officer pursuant to Sarbanes-Oxley Section
      302*
 
 31.2
              Certification
      by Chief Financial Officer pursuant to Sarbanes-Oxley Section
      302*
 
 32.1
              Certification
      by Chief Executive Officer pursuant to 18 U.S. C. Section
      1350*
 
 32.2
              Certification
      by Chief Financial Officer pursuant to 18 U.S. C. Section
      1350*
  FINANCIAL
STATEMENT SCHEDULES
 
 Schedule
II-Valuation and Qualifying Accounts
   * Filed
herewith.
  66
  SIGNATURES
  Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this Annual Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
   Dated:
      November 17, 2008
                Able
      Energy, Inc.By:
                /s/ Gregory
      D. FrostGregory
      D. FrostChairman
      & Chief Executive OfficerBy:
                /s/ Daniel
      L. JohnstonChief
      Financial Officer(Principal
      Accounting Officer)
 
 67
 
 SIGNATURES
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, this Annual Report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated:
   Signature
              Title
              Date/s/
      Gregory D. Frost
              Chairman & Chief
      Executive Officer
              November 17,
      2008Gregory D.
      Frost
              (Principal Executive
      Officer)/s/
      Daniel L. Johnston
              Chief Financial
      Officer
              November 17,
      2008Daniel L.
      Johnston
              (Principal
      Accounting Officer)/s/
      Stephen Chalk
              Director
              November 17,
      2008Stephen
      Chalk/s/ Solange
    Charas
              Director
              November 17,
      2008Solange
      Charas/s/ Edward C.
      Miller, Jr.
              Director
              November 17,
      2008Edward C. Miller,
      Jr./s/
      Patrick O'Neill
              Director
              November 17,
      2008Patrick
      O'Neill/s/
      Alan E. Richards
              Director
              November 17,
      2008Alan E.
      Richards/s/
      Christopher P. Westad
              Director
              November 17,
      2008Christopher P.
      Westad
  
 68
  Able
      Energy, Inc. and SubsidiariesSchedule
      II-Valuation and Qualifying AccountsBalance
      at
                
                
                
                
                
                
                
                
                Balance
      atBeginning
                
                
                
                
                
                
                
                
                Endof
      Period
                
                
                Additions
                
                
                Deductions
                
                
                of
      PeriodDescriptionYear
      ended June 30, 2008Deferred
      tax asset valuation allowance
                
                $
                -
                
                
                $
                10,051,534
                
                
                $
                (10,051,534
                )
                
                $
                -Allowance
      for doubtful accounts
                
                $
                744,253
                
                
                $
                659,844
                
                
                $
                (121,084
                )
                
                $
                1,283,013Year
      ended June 30, 2007Deferred
      tax asset valuation allowance
                
                $
                -
                
                
                $
                6,016,369
                
                
                $
                (6,016,369
                )
                
                $
                -Allowance
      for doubtful accounts
                
                $
                462,086
                
                
                $
                455,157
                
                
                $
                (172,990
                )
                
                $
                744,253