SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
FORM 10-KSB
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the fiscal year ended December 31, 2003.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from ____________ to ___________
Commission File No. 0-25319
TRANSPORTATION LOGISTICS INT'L, INC.
------------------------------------------------------
(Exact name of the Registrant as specified in Charter)
Colorado 84-1191355
--------------------------------------------------------------------------
(State or other jurisdiction (I.R.S. Employer ID Number)
of incorporation or organization)
136 Freeway Drive East, East Orange, NJ 07018
---------------------------------------------
(Address of principal executive offices)
Registrant's Telephone Number, including Area Code: 973-266-7020
Securities Registered Pursuant to Section 12(b) of the Act: None
Securities Registered Pursuant to Section 12(g) of the Act:
Common Stock, no par value per share
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for at least the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the 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. [ ]
State the issuer's revenues for its most recent fiscal year: $65,533
State the aggregate market value of the voting stock held by non-affiliates of
the Registrant. The aggregate market value shall be computed by reference to
the price at which the stock was sold, or the average bid and ask prices of
such stock, as of a specified date within 60 days prior to the date of filing.
The aggregate market value of the Registrant's common stock, no par value,
held by non-affiliates as of April 8, 2004 was $157,707
As of April 8, 2004, the number of shares outstanding of the Registrant's
common stock was 41,548,338 shares, no par value.
Transitional Small Business Disclosure Format: Yes [ ] No [X]
DOCUMENTS INCORPORATED BY REFERENCE: None
FORWARD-LOOKING STATEMENTS: NO ASSURANCES INTENDED
This Report contains certain forward-looking statements regarding
Transportation Logistics, its business and financial prospects. These
statements represent Management's present intentions and its present belief
regarding the company's future. Nevertheless, there are numerous risks and
uncertainties that could cause our actual results to differ from the results
suggested in this Report. Among the more significant risks are:
* the fact that Transportation Logistics has no assets and a large
amount of debt, which may prevent it from acquiring an operating
company.
Because these and other risks may cause the Company's actual results
to differ from those anticipated by Management, the reader should not place
undue reliance on any forward-looking statements that appear in this Report.
Readers should also take note that Transportation Logistics will not
necessarily make any public announcement of changes affecting these forward-
looking statements, which should be considered accurate on this date only.
PART 1
Item 1. BUSINESS
Transportation Logistics Int'l Inc. is a transportation logistics
management company. Prior to 2003 we were engaged in a variety of transpor-
tation and transportation-related activities. During 2003 we terminated all of
our operations.
We are now engaged in looking for one or more operating businesses to
acquire. Our priority would be to acquire businesses engaged in
transportation-related activities, to which we could apply our expertise.
Employees
The Company has no employees.
Item 2. PROPERTIES
Transportation Logistics does not own any real property. Its offices
are located at the Company's headquarters in East Orange, which we lease on an
at will basis.
Item 3. LEGAL PROCEEDINGS
In December 2001 Transportation Logistics commenced action in the United
States District Court for the District of New Jersey against Columbine
Financial Solutions, Inc. and Lawrence G. Alpert. The action alleges that the
defendants breached a contract to purchase 1,200,000 shares of our common
stock for $600,000. Since the defendants did pay a total of $214,000,
$386,000 in damages are alleged. The defendants have answered the complaint.
Discovery proceedings are taking place.
In April 2002 Transportation Logistics commenced action in the United
States District Court for the District of New Jersey against Rewico Investment
Limited, a U.K. corporation, and Rewico International GMBH. The action
alleges that the defendants defrauded Transportation Logistics in connection
with its acquisition of the U.S. operations of Rewico in 2000. $546,000 in
damages are alleged, and rescission of the issuance of 2,487,432 shares of
Transportation Logistics common stock is demanded. The defendants have not
yet answered the complaint.
Michael Seeley, the holder of a Convertible Debenture issued by the
Company in the principal amount of $200,000, commenced action in the District
Court for the City and County of Denver, State of Colorado, against the
Company. The action alleges that the Company has defaulted in payment of the
principal and $40,000 in interest accrued on the debenture. During 2003 Mr.
Seeley obtained a judgment against the Company for $240,000.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
(a) Market Information
Our common stock is listed for quotation on the OTC Bulletin Board under
the trading symbol "TRPL." The following table sets forth the bid prices
quoted for our common stock on the OTC Bulletin Board during the last two
years.
Bid
Period: High Low
------------------------------------------------------
Jan. 1, 2002 - Mar. 31, 2002 $ .22 $ .06
Apr. 1, 2002 - June 30, 2002 $ .13 $ .05
July 1, 2002 - Sep. 30, 2002 $ .06 $ .02
Oct. 1, 2002 - Dec. 31, 2002 $ .04 $ .01
Jan. 1, 2003 - Mar. 31, 2003 $ .01 $ .01
Apr. 1, 2003 - June 30, 2003 $ .01 $ .01
July 1, 2003 - Sep. 30, 2003 $ .01 $ .01
Oct. 1, 2003 - Dec. 31, 2003 $ .01 $ .01
(b) Shareholders
Our shareholders list contains the names of 99 registered shareholders
of record. The number of beneficial shareholders who hold their shares in
street name is much greater and cannot be determined at this time.
(c) Dividends
The Company has never paid or declared any cash dividends on its Common
Stock and does not anticipate doing so in the foreseeable future. The Company
intends to retain any future earnings for the operation and expansion of the
business. Any decision as to future payment of dividends will depend on the
available earnings, the capital requirements of the Company, its general
financial condition and other factors deemed pertinent by the Board of
Directors.
(d) Sale of Unregistered Securities
The Company did not sell any securities during 2003 that were not
registered under the Securities Act of 1933.
(e) Repurchase of Equity Securities
The Company did not repurchase any of its equity securities that were
registered under Section 12 of the Securities Exchange Act during the 4th
quarter of 2003.
Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Results of Operations
Effective as of June 30, 2003, the Company terminated the operations of
Xcalibur Xpress, the only operation which had been continuing prior to that
date. The Company liquidated the assets of Xcalibur Xpress and used the
proceeds to reduce its debts. In its financial statements for 2003 the
Company recorded a $1,620,260 "loss from discontinued operations of
subsidiary."
The only revenue recorded by the Company for 2003 was $65,533 that it
was paid for consulting services rendered. At the present time the Company
has no business operations. The Company intends to negotiate for one or more
acquisitions of operating companies in the field of transportation and
logistics. Any such acquisition, however, will involve the issuance of a
large number of shares of capital stock. Moreover it is unlikely that the
Company will be able to achieve any acquisition unless management is able to
negotiate compromises with the Company's principal creditors.
Liquidity and Capital Resources
The Company has no operating assets and $2,718,525 in net liabilities.
The Company will be unable to satisfy its liabilities unless its creditors
agree to compromise their claims in connection with the Company's acquisition
of an operating business.
Item 7. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
Item 8. FINANCIAL STATEMENTS
The Company's financial statements, together with notes and the Report
of Independent Certified Public Accountants, are set forth immediately
following Item 14 of this Form 10-KSB.
Item 8A. CONTROLS AND PROCEDURES
Michael Margolies, our Chief Executive Officer and Chief Financial Officer,
performed an evaluation of the Company's disclosure controls and procedures as
of December 31, 2003. Based on his evaluation, he concluded that the controls
and procedures in place are sufficient to assure that material information
concerning the Company which could affect the disclosures in the Company's
quarterly and annual reports is made known to him by the other officers and
employees of the Company, and that the communications occur with promptness
sufficient to assure the inclusion of the information in the then-current
report.
There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect those controls subsequent
to the date on which Mr. Margolies performed his evaluation.
PART III
Item 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
This table identifies our management team. Directors serve until the
next annual meeting of shareholders and until their successors are elected and
qualify. Officers serve at the pleasure of the Board of Directors.
Director
Name Age Position with the Company Since
------------------------------------------------------------------------------
Michael Margolies 76 Chairman, Chief Executive 2000
Officer, Chief Financial
Officer, Secretary
Stanley Chason 75 Director 2001
Michael Margolies founded our operating company in 1998. Mr. Margolies
previously served as Chief Executive Officer of U.S. Transportation Systems,
Inc. from its creation in 1975. USTS was a NASDAQ-listed holding company
involved in a diversified group of transportation-related businesses (e.g.
bus charters, freight-hauling, bus leasing, limousines, etc.). Mr. Margolies
left USTS in 1998 when it was sold to Precept Business Services, Inc. for
approximately $43 million. He then organized Transportation Logistics in
order to apply, in a non-asset-based environment, the skills in organization
and consolidation of transportation services that he developed at USTS.
Stanley Chason became a director of Transportation Logistics in November
2001. From 1962 until his retirement in 1984, Mr. Chason held various positions
with Gelco Corporation, a company listed on the New York Stock Exchange which
is involved in all aspects of vehicle leasing. His last position with Gelco
was as Executive Vice President and member of the Board of Directors. Mr.
Chason was also Chairman and Chief Executive Officer of the Fleet and
Management Services Division of Gelco.
Audit Committee
The Board of Directors does not have an audit committee financial
expert. The Board of Directors has not attempted to recruit an audit committee
financial expert because the Company does not have any business operations.
Code of Ethics
The Company does not have a written code of ethics applicable to its
executive officers. The Board of Directors has not adopted a written code of
ethics because there are so few members of management.
Compliance with Section 16(a) of the Exchange Act
None of the officers, directors or 10% shareholders of the Company
failed to file on a timely basis reports required during 2003 under Section
16(a) of the Exchange Act.
Item 10. EXECUTIVE COMPENSATION
This table itemizes the compensation we paid to Michael Margolies, who
served as our Chief Executive Officer during 2003. There was no other officer
whose salary and bonus for services rendered during the year ended December
31, 2003 exceeded $100,000.
Compensation
Year Salary Stock Grant
---------------------------
Michael Margolies 2003 $ 0
2002 $ 0 (1)
2001 $ 0
________________________
(1) Mr. Margolies received a restricted stock grant of 10,000,000 shares
during 2002. The terms of the grant are described below.
Restricted Stock Grant Program
On May 28, 2002 the Company granted 10,000,000 shares of its common
stock to Michael Margolies, its Chief Executive Officer, pursuant to the
Company's Restricted Stock Grant Program (the "Program"). The grant repre
sented the entirety of the 10,000,000 shares included in the Program. The
shares issued under the Program are subject to the following restrictions:
1. After 2002 and each of the following four fiscal years (2003 through
2006) one-fifth of the shares granted (the "At-Risk Shares") will be forfeited
if the Company's' revenue during the year does not exceed the following
thresholds:
2002 - $ 4,000,000
2003 - $ 6,000,000
2004 - $ 8,000,000
2005 - $ 10,000,000
2006 - $ 12,000,000
2. All of the restricted shares shall be forfeited if Mr. Margolies'
employment by the Company terminates prior to the date the restrictions lapse.
3. The shares granted under the Program cannot be sold, assigned,
pledged, transferred or hypothecated in any manner, by operation of law or
otherwise, other than by writ or the laws of descent and distribution, and
shall not be subject to execution, attachment or similar process. These
restrictions will lapse with respect to any At-Risk Shares that are not
forfeited as described above. In addition, the restrictions will lapse with
respect to all unforfeited shares if in any year the Company's revenue exceeds
$12,000,000.
4. The restrictions shall also lapse as to all restricted shares on the
first to occur of (i) the termination of Mr. Margolies' employment with the
Company by reason of his disability, (ii) Mr. Margolies' death, (iii) termina
tion of Mr. Margolies'employment by the Company without good reason, or (iv) a
change of control of the Company. The Program defines "Change of Control" as
an acquisition by a person or group of more than 50% of the Company's out
standing shares, a transfer of the Company's property to an entity of which
the Company does not own at least 50%, or the election of directors constitut
ing a majority of the Board who have not been approved by the existing Board.
On May 1, 2004 Mr. Margolies will forfeit 2,000,000 of the At-Risk
Shares due to the Company's failure to achieve the revenue threshold for 2003.
Compensation of Directors
Our directors are reimbursed for out-of-pocket expenses incurred on our
behalf, but receive no additional compensation for service as directors.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information known to us with respect to
the beneficial ownership of our common stock as of the date of this prospectus
by the following:
* each shareholder known by us to own beneficially more than 5% of our
common stock;
* each officer named in the Executive Compensation table above.
* each of our directors; and
* all directors and executive officers as a group.
There are 41,548,338 shares of our common stock outstanding on the date
of this Report. Except as otherwise indicated, we believe that the beneficial
owners of the common stock listed below have sole voting power and investment
power with respect to their shares, subject to community property laws where
applicable. Beneficial ownership is determined in accordance with the rules
of the Securities and Exchange Commission.
In computing the number of shares beneficially owned by a person and the
percent ownership of that person, we include shares of common stock subject to
options or warrants held by that person that are currently exercisable or will
become exercisable within 60 days. We do not, however, include these "issuable"
shares in the outstanding shares when we compute the percent ownership of any
other person.
Amount and
Nature of
Name and Address Beneficial Percentage
of Beneficial Owner (1) Ownership (2) of Class
---------------------------------------------------------------------
Michael Margolies 21,834,939(3) 52.6%
Stanley Chason 2,500 0.1%
All Officers and
Directors As a
Group (2 persons) 21,837,439 52.5%
Rewico Investment
Limited 2,487,432 6.0%
City House
9, Cranbrook Road
Ilford, Essex UK IG14EA
____________________________________
(1) Except as noted, the address of all shareholders is c/o Transportation
Logistics Int'l, Inc., 136 Freeway Drive East, East Orange, NJ 07018
(2) All shares are owned of record unless otherwise indicated
(3) Includes 2,618,350 shares owned by the Margolies Family Trust. The
Trustee of the Margolies Family Trust is Mr. Margolies' spouse, and the
beneficiaries of the Trust are Mr. Margolies' spouse and children.
Also includes 10,000,000 shares which are subject to the terms of the
Restricted Stock Grant Program. 2,000,000 of those shares will be
forfeited on May 1, 2004.
Equity Compensation Plan Information
The information set forth in the table below regarding equity compensation
plans (which include individual compensation arrangements) was determined as
of December 31, 2003. Weighted Number of
average securities
Number of exercise remaining
securities price of available for
to be issued outstanding future issuance
upon exercise options, under equity
of outstanding warrants compensation
options and rights plans
-----------------------------------------------------------------------------
Equity compensation plans
approved by security
holders.................. 0 -- 0
Equity compensation plans
not approved by security
holders*................. 0 -- 812,500
------------------------------------------
Total.................... 0 -- 812,500
==========================================
* Our Board of Directors has adopted three equity compensation plans without
shareholder approval. The three plans are identical in their material
terms. They permit the Board to award to employees, directors or
consultants (other than consultants whose services to Transportation
Logistics are related to capital-raising transactions) stock, restricted
stock, stock options or performance shares.
Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
From time to time, Transportation Logistics has borrowed money from the
Margolies Family Trust. The trustee of the Margolies Family Trust is the wife
of our Chairman, and the beneficiaries of the Trust are his wife and children.
The balance due from Transportation Logistics to the Trust at December 31,
2003 was $1,020,210. The loan does not bear interest. Although there is no
agreement as to when the loan will be repaid, the Trust has waived payment
until after 2004. Accordingly, the loan is classified as a "long-term
liability" on our balance sheet.
Item 13. EXHIBIT LIST AND REPORTS ON FORM 8-K
(a) Financial Statements
Report of Independent Auditors F-1
Consolidated Balance Sheets F-2
Consolidated Statements of Operations F-3
Consolidates Statements of Comprehensive Income F-4
Consolidated Statements of Shareholders' Equity F-5
Consolidated Statements of Cash Flows F-6
Notes to Consolidated Financial Statements F-7
(b) Exhibit List
3-a Articles of Amendment and Restatement of the Articles of Incorporation -
filed as an exhibit to the Annual Report on Form 8-K for the year ended
December 31, 2000 and incorporated herein by reference.
3-b Restated By-laws - filed as an exhibit to the Current Report on Form 8-K
dated November 17, 2000 and incorporated herein by reference.
10-a 2002 Stock and Stock Option Plan - filed as an exhibit to the
Registration Statement on Form S-8 (333-81232) and incorporated herein
by reference.
10-b 2002 Stock Incentive Plan - filed as an exhibit to the Registration
Statement on Form S-8 (333-84750) and incorporated herein by reference.
21 Subsidiaries - Transportation Logistics Int'l, Inc., a New York
corporation
Xcalibur Express, Inc.
31 Rule 13a-14(a) Certification
32 Rule 13a-14(b) Certification
(c) Reports on Form 8-K
None
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees
Rosenberg Rich Baker Berman & Company billed $14,295 to the Company
for professional services rendered for the audit of our 2003 financial
statements and review of the financial statements included in our reports on
Form 10-QSB for the first three quarters of 2003.
Audit-Related Fees
Rosenberg Rich Baker Berman & Company billed $0 to the Company in
2003 for assurance and related services that are reasonably related to the
performance of the 2003 audit or review of the quarterly financial statements.
Tax Fees
Rosenberg Rich Baker Berman & Company billed $0 to the Company
in 2003 for professional services rendered for tax compliance, tax advice and
tax planning.
All Other Fees
Rosenberg Rich Baker Berman & Company billed $0 to the Company in 2003
for services not described above.
It is the policy of the Company's Board of Directors that all services
other than audit, review or attest services, must be pre-approved by the Board
of Directors. All of the services described above were approved by the Board
of Directors.
Independent Auditors' Report
To the Board of Directors and Stockholders of
Transportation Logistics Int'l Inc. and Subsidiaries
We have audited the accompanying consolidated balance sheet of Transportation
Logistics Int'l Inc. and Subsidiaries as of December 31, 2003, and the related
consolidated statements of operations, comprehensive income, shareholders
equity, and cash flows for the years ended December 31, 2003 and 2002. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Transportation Logistics
Int'l Inc. and Subsidiaries as of December 31, 2003, and the results of their
operations and their cash flows for the years ended December 31, 2003 and
2002 in conformity with accounting principles generally accepted in the
United States of America.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company's significant operating loss raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
Bridgewater, New Jersey
April 9, 2004
Rosenberg Rich Baker Berman & Company
Transportation Logistics Int'l Inc. and Subsidiaries
Consolidated Balance Sheet
December 31, 2003
Assets
Cash $ 1,564
----------
Total Assets $ 1,564
==========
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued expenses 132,388
Convertible debenture (NOTE 10) 200,000
Net liabilities of discontinued
operations (NOTE 4) 1,365,927
----------
Total Current Liabilities 1,698,315
Loan payable (NOTE 8) 1,020,210
----------
Total Liabilities 2,718,525
----------
Commitments and Contingencies (NOTE 9) -
Stockholders' Equity
Preferred stock, $.01 par value;
5,000,000 shares authorized, and 0
shares issued and outstanding -
Common stock, no par value;
50,000,000 shares authorized,
40,631,990 shares issued and
40,396,338 shares outstanding 3,659,492
Additional paid-in capital -
stock options (NOTE 3) 36,748
Retained earnings (deficit) (5,430,664)
Consulting services to be provided
(NOTE 7) (460,000)
Less: treasury stock, 235,652 shares
at cost (522,537)
----------
Total Stockholders' Equity (2,716,961)
----------
Total Liabilities and Stockholders' Equity $ 1,564
==========
See notes to the consolidated financial statements.
Transportation Logistics Int'l Inc. and Subsidiaries
Consolidated Statements of Operations
Year Ended December 31,
2003 2002
-----------------------
(Restated)
Operating Revenues (NOTES 1 and 4) $ 65,533 $ -
Direct Operating Expenses - -
---------- --------
Gross Profit 65,533 -
---------- --------
Operating Expenses
Selling, general and administrative 138,489 50,150
Stock based compensation (NOTE 7) 635,500 302,700
---------- --------
Total Operating Expenses 773,989 352,850
---------- --------
(Loss) Before Income Taxes (708,456) (352,850)
(Provision) Benefit for Income Taxes (NOTE 2) - -
---------- --------
(Loss) Before Discontinued Operations (708,456) (352,850)
Discontinued Operations (NOTE 4)
Loss from discontinued operations of subsidiary
(net of tax effect of $0) (1,620,260) (407,201)
---------- --------
Net (Loss) $(2,328,716) $(760,051)
========== ========
Earnings (Loss) Per Share (NOTE 1)
(Loss) from continuing operations $ (0.02) $ (0.01)
(Loss) from discontinued operations (0.04) (0.01)
---------- --------
Basic and diluted earnings (loss) per share $ (0.06) $ (0.02)
========== ========
Weighted Average Number of Common Shares
Outstanding (Restated)
Basic 40,396,338 34,374,627
========== ==========
Diluted 40,396,338 34,374,627
========== ==========
See notes to the consolidated financial statements.
Transportation Logistics Int'l Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
Year Ended December 31,
2003 2002
--------------------------
Net (Loss) $(2,328,716) $ (760,051)
Other Comprehensive Income
Foreign Currency Translation Adjustment - 54,706
---------- ----------
Other Comprehensive (Loss) Income Before Tax - 54,706
Income Tax Expense Related to Other
Comprehensive Income - -
---------- ----------
Other Comprehensive (Loss) Income Net of Tax - 54,706
---------- ----------
Comprehensive (Loss) $(2,328,716) $ (705,345)
========== ==========
See notes to the consolidated financial statements.
Transportation Logistics Int'l Inc. and Subsidiaries
Consolidated Statement of Shareholders' Equity
Years Ended December 31, 2003 and 2002
Additional
Accumulted Paid-in Consulting
Preferred Stock Common Stock Other Capital - Services
--------------- ---------------------- Retained Comprehensive Treasury Stock to be
Shares Amount Shares Amount Earnings Income Stock Options Provided Total
----------------------------------------------------------------------------------------------------------------------------------
Balance December
31, 2001 - $ - 22,227,205 $ 2,261,292 $(2,341,897) $ (54,706) $ (456,675) $36,748 $ - $ (555,238)
--------------------------------------------------------------------------------------------------------------
Foreign currency
translation - - - - - 54,706 - - - 54,706
Issuance of common
stock for consulting
services - - 9,110,000 798,200 - - - - (798,200) -
Shares issued for other
compensation - - 10,000,000 600,000 - - - - (600,000) -
Shares surrendered in
connection with sale
of TLI (UK) - - (940,867) - - - (65,862) - - (65,862)
Net loss for the years
ended December 31, 2002 - - - - (760,051) - - - - (760,051)
Amortization of prepaid
consulting services - - - - - - - - 302,700 302,700
----------------------------------------------------------------------------------------------------------
Balance December
31, 2002 - - 40,396,338 3,659,492 (3,101,948) - (522,537) 36,748 (1,095,500) (1,023,745)
Net loss for the year
ended December
31, 2003 - - - - (2,328,716) - - - - (2,328,716)
Amortization of
prepaid consulting
services - - - - - - - - 635,500 635,500
-----------------------------------------------------------------------------------------------------------
Balance December
31, 2003 - $ - 40,396,338 $ 3,659,492 $(5,430,664) $ - $ (522,537) $36,748 $ (460,000) $(2,716,961)
===========================================================================================================
See notes to the consolidated financial statements.
Transportation Logistics Int'l Inc. and Subsidiaries
Consolidated Statements of Cash Flows
Year Ended December 31,
2003 2002
--------------------------
(Restated)
Cash Flows From Operating Activities
Continuing Operations
Loss before income taxes $ (708,456) $ (352,850)
Amortization of stock based compensation 635,500 302,700
Adjustments to Reconcile Net Income to Net
Cash Used In Operating Activities
(Decrease) increase in accounts payable
and accrued expenses 38,304 2,521
--------- ---------
Cash Used by Continuing Operations (34,652) (47,629)
--------- ---------
Discontinued Operations
Loss before income taxes (1,620,260) (407,201)
Adjustments to reconcile net loss to
net cash Used In discontinued operations
(Increase) decrease in net assets of
discontinued operations 1,663,135 433,920
--------- ---------
Cash Provided By Discontinued Operations 42,875 (26,719)
--------- ---------
Net Cash Provided by (Used in) Operating
Activities 8,223 (20,910)
--------- ---------
Cash from financing activities
Proceeds from loan payable 111,417 -
Repayment of long term debt (120,833) -
--------- ---------
Net Cash Used in Financing Activities (9,416) -
--------- ---------
Net Decrease in Cash and Equivalents (1,193) (20,910)
Cash and Equivalents at Beginning of Period 2,757 23,667
--------- ---------
Cash and Equivalents at End of Period $ 1,564 $ 2,757
========= =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest $ - $ -
========= =========
Income taxes $ - $ -
========= =========
See notes to the consolidated financial statements.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Organization
Transportation Logistics Int'l, Inc. (TLI or the Company) is an
international logistics management company which owned and operated
several subsidiaries, each of which did business within the various facets
of transportation including intermodal trucking, factoring receivables and
employee leasing for logistic companies. In 2003 the Company discontinued
all of those operations by May 2003. Since May 2003, the Company has been
providing consulting services while seeking new business ventures.
The Company's financial statements have been presented on the basis that
it is a going concern, which contemplates the realization of assets and
the satisfaction of liabilities in the normal course of business. The
Company has incurred substantial losses, and has a working capital deficit
as of December 31, 2003. The Company's continued existence is dependent
upon its ability to secure adequate financing. The Company plans to raise
additional capital in the future; however there are no assurances that such
plan will be successful. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
Effective April 1, 1999 the Company was assigned all of the issued and
outstanding capital stock of Transportation Logistics Int'l (UK), a United
Kingdom corporation, Pupil Transportation, Inc., a New Jersey Corporation
and CDA North America, Inc., a New York corporation (the subsidiaries) from
Transportation Equities, Inc. (assignor). The Company was sold in 2002.
Effective March 26, 1999 the Company acquired all the shares and assets of
Transportation Logistics Int'l UK (TLIUK) formerly Avair Freight Services
Ltd. (UK), an international freight brokerage company. The Company issued
100,000 common shares (524,000 restated common shares) to the former
shareholders of Avair Freight Services (UK) Ltd.
Effective June 4, 2001, the Company entered into an operating agreement
with Humanaforce Logistics, LLC and Subsidiaries. In accordance with the
operating agreement the Company had a 51% interest in Humanaforce Logistics,
LLC and Subsidiaries. The Company ceased operations in October 2002.
Effective May 23, 2002, the Company acquired all of the outstanding capital
stock of Xcalibur Express, Inc., which provided intermodal trucking and
delivery, warehousing and third party logistics for its clients. The
capital stock was acquired in exchange for (1) the Company's understanding
to provide financial services to Xcalibur Express and (2) the agreement by
the Company to forebear immediate collection of $200,000 owed by Xcalibur
Express to the Company. The Company ceased operations and declared
bankruptcy in 2003.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statement and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from these estimates.
Principles of Consolidation
The accompanying consolidated balance sheet at December 31, 2003 includes
the accounts of the Company and its wholly owned subsidiaries
Transportation Logistics Int'l (UK), Pupil Transportation, Inc. Excalibur
Express, Inc. All material inter-company accounts and transactions have
been eliminated.
Property and Equipment
Property and equipment are valued at cost. Gains and losses on
disposition of property are reflected in income. Depreciation is computed
using the straight-line method over three to five year estimated useful
lives of the assets.
Repairs and maintenance which do not extend the useful life of the related
assets are expensed as incurred.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Cash and Equivalents
For purposes of the statement of cash flows, cash equivalents include
time deposits, certificates of deposit and all highly liquid debt
instruments with original maturities of three months or less.
Income Taxes
The Company and its wholly owned subsidiaries file a consolidated Federal
income tax return. Transportation Logistics Int'l, Inc. uses the asset
and liability method in providing income taxes on all transactions that
have been recognized in the consolidated financial statements. The asset
and liability method requires that deferred taxes be adjusted to reflect
the tax rates at which future taxable amounts will be settled or realized.
The effects of tax rate changes on future deferred tax liabilities and
deferred tax assets, as well as other changes in income tax laws, are
recognized in net earnings in the period such changes are enacted.
Valuation allowances are established when necessary to reduce deferred
tax assets to amounts expected to be realized.
Financial Instruments
The following methods and assumptions were used by the Company to estimate
the fair values of financial instruments as disclosed herein:
Cash and Equivalents: The carrying amount approximates fair value because
of the short period to maturity of the instruments.
Accounts Receivable/Payable: The carrying amount approximated fair value.
Revenue Recognition
Revenue from freight brokerage is recognized upon delivery of goods, and
direct expenses associated with the cost of transportation are accrued
concurrently.
Revenue from driver temporary services and leasing is recognized when
earned based upon standard billing rates charged by the hours worked.
Factoring revenue is recognized when the service is provided. Direct
expenses associated with the cost of driver leasing are accrued
concurrently. Revenue from subcontracted transportation services is
recognized upon completion of each trip. Direct expenses associated
with the cost of transportation are accrued concurrently.
Monthly provision is made for doubtful receivables, discounts, returns
and allowances.
Long-lived Assets
In March, 1995 the Financial Accounting Standards Board issued SFAS No.
121 "Accounting for the Impairment of Long-Lived Assets for Long-Lived
Assets to be Disposed of". SFAS 121 required that long-lived assets and
certain identifiable intangibles to be held and used by an entity be
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable and
long-lived assets and certain identifiable intangibles to be disposed of
to be reported at the lower of carrying amount or fair value less cost
to sell. SFAS No. 121 also establishes the procedures for review of
recover ability and measurement of impairment, if necessary, of long-
lived assets and certain identifiable intangibles to be held and used by
an entity. Management has determined that no impairment of the respective
carrying value has occurred as of December 31, 2003.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Foreign Currency Transactions
In the normal course of business the Company has accounts receivable and
accounts payable that are transacted in foreign currencies. The Company
accounts for transaction differences, in accordance with Statement of
Financial Standard No. 52, "Foreign Currency Translation", and accounts
for the gains and losses in operations.
Comprehensive Income
For foreign operations outside the United States that prepare financial
statements in currencies other than the U.S. dollar, results of operations
and cash flows are translated at average exchange rates. Translation
adjustments are included as a separate component of accumulated other
comprehensive income (loss) in shareholders' equity. The foreign currency
translation at December 31, 2003 and 2002 was $0 and $54,706,
respectively.
Earnings Per Share
The Company computes earnings per share in accordance with Statements
of Financial Accounting Standard ("SFAS") No. 128. Basic EPS excludes
dilution and is computed by dividing income available to common
stockholders by the weighted average number of common shares outstanding
for the period. Diluted EPS reflects the potential dilution that could
occur if securities or other contracts to issue common stock were
exercised or converted into common stock or resulted in the issuance of
common stock that then shared in the earnings of the entity. Common
equivalent shares have been excluded from the computation of diluted EPS
since their affect is antidilutive.
NOTE 2 - INCOME TAXES
Deferred income taxes arise from temporary differences resulting from
income and expense items reported for financial accounting and tax
purposes in different periods. Deferred taxes are classified as current
or noncurrent, depending on the classification of the assets and
liabilities to which they relate. Deferred taxes arising from temporary
differences that are not related to an asset or liability are
classified as current or noncurrent depending on the periods in which
the temporary differences are expected to reverse. In addition deferred
taxes are also recognized from operating losses that are available to
offset future federal and state income taxes.
The deferred tax assets are attributable to net operating losses.
Deferred taxes consist of the following:
Total deferred tax assets, non current $ 1,920,000
Total valuation allowance (1,920,000)
----------
Net deferred tax assets $ -
==========
During 2003 and 2002 the valuation allowance increased $920,000 and
$400,000, respectively.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 2 - INCOME TAXES, Continued
The reconciliation of income tax computed at the U.S. Federal statutory
rates to income tax expense is as follows:
December 31,
2003 2002
------------------
Tax at US statutory rate 34 % 34 %
State income taxes, net of
federal benefit 6 % 6 %
Foreign taxes - (21)%
Other reconciling items and
valuation allowance (40)% (19)%
--- ---
Income tax provision 0 % 0 %
=== ===
As of December 31, 2003, the Company has approximately $4,800,000
available net operating loss carryforwards which may be used to reduce
Federal and State taxable income and tax liabilities in future years.
The net operating loss carryforward expires in 2022.
NOTE 3 - STOCKHOLDERS' EQUITY
Stock and Stock Option Plan
On November 15, 2000, the Company adopted its 2000 Stock and Stock Option
Plan (the "Plan"). The Plan provides that certain options to purchase the
Company's common stock granted thereunder are intended to qualify as
"incentive stock options" within the meaning of Section 422A of the
United States Internal Revenue Code of 1986, while non-qualified options
may also be granted under the Plan. The initial plan provides for
authorization of up to 2,000,000 shares. The option price per share of
stock purchasable under an Incentive Stock Option shall be determined at
the time of grant but shall not be less than 100% of the Fair Market Value
of the stock on such date, or, in the case of a 10% Stockholder, the
option price per share shall be no less than 110% of the Fair Market Value
of the stock on the date an Incentive Stock Option is granted to such 10%
Stockholder.
Qualified and Non-Qualified Shares Under Option as of December 31, 2003
Weighted
Average
Option
Options Price
--------------------------------
Outstanding, January 1, 2003 $ - $ 1.75
Granted during the year - -
Canceled during the year - 1.75
Exercised during the year - -
------- ------
Outstanding, December 31, 2003 $ - $ -
------- ------
Eligible for exercise, end of
year $ - $ -
======= ======
At December 31, 2003, there were 812,500 shares reserved for future grants.
The Company follows Accounting Principles Board Opinion 25, Accounting for
Stock Issued to Employees, to account for its stock option plan. An
alternative method of accounting for stock options is SFAS 123, Accounting
for Stock-Based Compensation. Under SFAS 123, employee stock options are
valued at grant date using the Black-Scholes valuation model, and this
compensation cost is recognized ratably over the vesting period. Had
compensation cost for the Company's stock option plan been determined as
prescribed by SFAS 123, there would have been no effect on the pro forma
income statements for 2003 and 2002.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 3 - STOCKHOLDERS' EQUITY, Continued
For stock transactions with other than employees, the Company adopted the
provisions of Statement of Financial Accounting Standards (SFAS) No. 123,
"Accounting for Stock Based Compensation". Accordingly, compensation
expense of $0 has been recognized for stock options and warrants during
2003 and 2002.
NOTE 4 - DISCONTINUED OPERATIONS
Effective April 19, 2002 the Company sold Transportation Logistic Int'l to
four individuals, including James Thorpe, who had been a Member of the
Board of Directors and President of the Company. The purchase price
consisted of (a) $35,000 to be paid between November 2002 and April 2003
and (b) 940,867 shares of its common stock which were surrendered by Mr.
Thorpe. As part of the transaction TLI (UK) and its purchasers agreed that
if within the next two years they participated in the Translogistics
Network or any similar cooperative global network of logistics provided,
then 50% of the profits they derive from the network during the next five
years will be paid to the Company. Net sales during 2002 was $858,842.
In September 2002, the Company ceased providing employee leasing options
through its 51% subsidiary Human Force Logistics, LLC and Subsidiaries.
Net sales of Human Force Logistics, LLC was $3,857,071 in 2002.
In December 2002, the Company ceased its operations of student
transportation services through its subsidiary Pupil Transportation, Inc.
Net sales of Pupil Transportation, Inc. was $2,328,074 in 2002.
In 2002 the Company ceased its financial services (factoring) division.
Net sales of the financial services division was $686,129 in 2002.
In 2003 the Company ceased its intermodal trucking operations. Net sales
of this division was $1,693,203 and $3,620,807 in 2003 and 2002,
respectively.
The 2002 income statement has been restated to reflect these changes.
NOTE 5 - EMPLOYMENT AND CONSULTANT AGREEMENTS
The Company has an employment agreement with its principal officer expiring
April 2007. This agreement provides for minimum compensation levels and
for incentive bonuses which are payable if specified management goals are
attained. The Company did not meet its goals in 2003.
NOTE 6 - CONCENTRATIONS OF CREDIT RISK
Financial instruments that potentially subject the Company to
concentrations of credit risk consist principally of non-interest
bearing cash deposit and accounts receivable.
At times throughout the year, the Company may maintain certain bank
accounts in excess of FDIC insured limits.
The Company provides credit in the normal course of business. The
Company performs ongoing credit evaluations of its customers and
maintains allowances for doubtful accounts based on factors surrounding
the credit risk of specific customers, historical trends, and other
information.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 7 - CONSULTING SERVICES TO BE PROVIDED
Consulting services to be provided are recorded in connection with
common stock issued to consultants for future services and are amortized
over the period of the agreement, ranging from one to five years.
NOTE 8 - LOAN PAYABLE
The loan payable of $1,020,210 is from a family trust, of which the wife
of the chairman of the Company is the trustee. The loan is unsecured
with no specific repayment terms and will not be repaid until after 2004.
NOTE 9 - LITIGATION
The Company, several related companies, its chairman and certain employees
are defendants in a lawsuit filed by an alleged acquisition candidate for
alleged breach of contract. The complaint does not specify an amount for
damages. The Company believes the suit is completely without merit and
intends to vigorously defend its position.
The Company, several related companies, its chairman and its subsidiaries
are defendants in a lawsuit filed by one of its former vendors. At this
stage in the proceedings, the probable outcome is unknown. The Company
has a counter claim based upon defective services provided by the vendor.
The Company believes the settlement of the lawsuit will not exceed amounts
already recorded in the financial statements.
The Company and its subsidiaries are defendants in lawsuits filed by its
former vendors. The Company has judgements filed against them. These
judgements that amounted to $178,728 are included in net liabilities of
discontinued operations.
NOTE 10 - CONVERTIBLE DEBENTURES
On June 14, 2001, the Company issued a convertible debenture for
$200,000 which bears interest at the rate of 20% per annum and is due
one year from the date of issue. In accordance with the agreement the
debenture is convertible into common stock of the Company at a conversion
rate of $.75 from the date of issuance through September 30, 2001. The
conversion period has been extended. In addition, the debenture includes
warrants to purchase 20,000 shares of common stock at $1.50 that expired
on June 30, 2003. Included in accounts payable is $40,000 of accrued
interest and accrued expenses on these debentures. The convertible
debentures are in default.
NOTE 11 - NEW ACCOUNTING PRONOUNCEMENTS
In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements
No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical
Corrections. This statement rescinds SFAS No. 4, Reporting Gains and
Losses from Extinguishment of Debt, and an amendment of that statement,
SFAS No. 44, Accounting for Intangible Assets of Motor Carriers, and SFAS
No. 64, Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements.
This statement amends SFAS No. 13, Accounting for Leases, to eliminate
inconsistencies between the required accounting for sales-leaseback
transactions and the required accounting for certain lease modifications
that have economic effects that are similar to sales-leaseback
transactions. Also, this statement amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings, or
describe their applicability under changed conditions. Provisions of SFAS
No. 145 related to the rescissions of SFAS No. 4 were effective for the
Company on November 1, 2002 and provisions affecting SFAS No. 13 were
effective for transactions occurring after May 15, 2002. The adoption of
SFAS No. 145 did not have a significant impact on the Company's results of
operations or financial position.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 11 - NEW ACCOUNTING PRONOUNCEMENTS, Continued
In June 2003, the FASB issued SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities. This statement covers
restructuring type activities beginning with plans initiated after
December 31, 2002. Activities covered by this standard that are entered
into after that date will be recorded in accordance with provisions of
SFAS No. 146. The adoption of SFAS No. 146 did not have a significant
impact on the Company's results of operations or financial position.
In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-
Based Compensation-Transition and Disclosure, which provides alternative
methods of transition for a voluntary change to fair value based method
of accounting for stock-based employee compensation as prescribed in
SFAS 123, Accounting for Stock-Based Compensation. Additionally, SFAS
No. 148 required more prominent and more frequent disclosures in
financial statements about the effects of stock-based compensation. The
provisions of this Statement are effective for fiscal years ending after
December 15, 2002. The adoption of this statement did not have a
significant impact on the Company's results of operations of financial
position.
In April 2003, the FASB issued SFAS Statement No. 149, "Amendment of
Statement 133 on Derivative Instruments and Hedging Activities", which
amends and clarifies financial accounting and reporting for derivative
instruments, including certain derivative instruments embedded in other
contracts (collectively referred to as derivatives) and for hedging
activities under FASB Statement No. 133, Accounting for Derivative
Instruments and Hedging Activities. This Statement is effective for
contracts entered into or modified after June 30, 2003, except for
certain hedging relationships designated after June 30, 2003. Most
provisions of this Statement should be applied prospectively. The
adoption of this statement did not have a significant impact on the
Company's results of operations or financial position.
In May 2003, the FASB issued SFAS Statement No. 150, "Accounting for
Certain Financial Instruments with Characteristics of both Liabilities
and Equity". This Statement establishes standards for how an issuer
classifies and measures certain financial instruments with
characteristics of both liabilities and equity. It requires that an
issuer classify a financial instrument that is within its scope as
a liability (or an asset in some circumstances). This statement is
effective for financial instruments entered into or modified after May
31, 2003, and otherwise is effective at the beginning of the first
interim period beginning after June 15, 2003, except for mandatorily
redeemable financial instruments of nonpublic entities, if applicable.
It is to be implemented by reporting the cumulative effect of a
change in an accounting principle for financial instruments created
before the issuance date of the Statement and still existing at the
beginning of the interim period of adoption. The adoption of this
statement is did not have a significant impact on the Company's results
of operations or financial position.
In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"),
Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Indirect Guarantees of Indebtedness of Others. FIN 45
requires a company, at the time it issues a guarantee, to recognize an
initial liability for the fair value of obligations assumed under the
guarantees and elaborates on existing disclosure requirements related to
guarantees and warranties. The recognition requirements are effective
for guarantees issued or modified after December 31, 2002 for initial
recognition and initial measurement provisions. The adoption of FIN 45
did not have a significant impact on the Company's results of operations
or financial position.
In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
Consolidation of Variable Interest Entities, an Interpretation of ARB
No. 51. FIN 46 requires certain variable interest entities to be
consolidated by the primary beneficiary of the entity if the equity
investors in the entity do not have the characteristics of a controlling
financial interest or do not have sufficient equity at risk for the
entity to finance its activities without additional subordinated
financial support from other parties. FIN 46 is effective for all new
variable interest entities created or acquired after January 31, 2003.
For variable interest entities created or acquired prior to February 1,
2003, the provisions of FIN 46 must be applied for the first interim or
annual period beginning after June 15, 2003. The adoption of FIN 46
did not have a significant impact on the Company's results of operations
or financial position.
Transportation Logistics Int'l Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
NOTE 12 - RESTRICTED STOCK GRANT PROGRAM
On May 28, 2002 the Company granted 10,000,000 shares of its common
stock to Michael Margolies, its Chief Executive Officer, pursuant to the
Company's Restricted Stock Grant Program (the "Program"). The grant
represented the entirety of the 10,000,000 shares included in the
Program. The shares issued under the Program are subject to the
following restrictions:
1. After this fiscal year and each of the following four fiscal years
(2002 through 2006) one-fifth of the shares granted (the "At-Risk Shares")
will be forfeited if the Company's revenue during the year does not exceed
the following thresholds:
2003 - $ 6,000,000
2004 - $ 8,000,000
2005 - $10,000,000
2006 - $12,000,000
2. All of the restricted shares shall be forfeited if Mr. Margolies'
employment by the Company terminates prior to the date the restrictions
lapse.
3. The shares granted under the Program cannot be sold, assigned, pledged,
transferred or hypothecated in any manner, by operation of law or
otherwise, other than by writ or the laws of descent and distribution,
and shall not be subject to execution, attachment or similar process.
These restrictions will lapse with respect to any At-Risk Shares that
are not forfeited as described above. In addition, the restrictions
will lapse with respect to all unforfeited shares if in any year the
Company's revenue exceeds $12,000,000.
4. The restrictions shall also lapse as to all restricted shares on the
first to occur of (i) the termination of Mr. Margolies' employment with
the Company by reason of his disability, (ii) Mr. Margolies' death,
(iii) termination of Mr. Margolies' employment by the Company without
good reason, or (iv) a change of control of the Company. The Program
defines "Change of Control" as an acquisition by a person or group of
more than 50% of the Company's outstanding shares, a transfer of the
Company's property to an entity of which the Company does not own at
least 50%, or the election of directors constituting a majority of the
Board who have not been approved by the existing Board.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
has caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
By: /s/ Michael Margolies
-------------------------------------------
Michael Margolies, Chief Executive Officer
In accordance with the Exchange Act, this Report has been signed below
on April 12, 2004 by the following persons, on behalf of the Registrant and in
the capacities and on the dates indicated.
/s/ Michael Margolies Chief Executive Officer, Chief Financial
--------------------- Officer, Chief Accounting Officer
Michael Margolies
/s/ Stanley Chason Director
---------------------
Stanley Chason
* * * * *
Exhibit 31
RULE 13a-14(a) Certification
I, Michael Margolies, certify that:
1. I have reviewed this annual report on Form 10-KSB of Transportation
Logistics Int'l, Inc.;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this report;
3. Based on my knowledge, the financial statements and other financial
information included in this report fairly present in all material respects
the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The small business issuer's other certifying officers and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:
a) Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
b) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of ths disclosure controls and procedures,
as of the end of the period covered by this report based on such evaluation;
and
c) Disclosed in this report any changes in the small business
issuer's internal control over financial reporting that occurred during the
small business issuer's most recent fiscal quarter that has materially
affected, or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting.
5. The small business issuer's other certifying officers and I
have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the small business issuer's ability to
record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management
or other employees who have a significant role in the small business issuer's
internal control over financial reporting.
Date: April 12, 2004 /s/ Michael Margolies
--------------------------------------------
Michael Margolies, Chief Executive Officer
and Chief Financial Officer
* * * * *
EXHIBIT 32
Rule 13a-14(b) Certification
The undersigned officer certifies that this report fully complies with the
requirements of Section 13(a) of the Securities Exchange Act of 1934, and that
the information contained in the report fairly presents, in all material
respects, the financial condition and results of operations of Transportation
Logistics Int'l, Inc.
A signed original of this written statement required by Section 906 has been
provided to Transportation Logistics Int'l, Inc. and will be retained by
Transportation Logistics Int'l, Inc. and furnished to the Securities and
Exchange Commission or its staff upon request.
April 12, 2004 /s/ Michael Margolies
-----------------------------------
Michael Margolies (Chief executive
officer and chief financial officer)