Gary....Your going to have to learn how to copy and paste:
Wednesday July 29, 12:06 pm Eastern Time
Company Press Release
Viking Resources International and Executive Jetport of New Jersey Form Joint Venture
TAMPA, Fla.--(BUSINESS WIRE)--July 29, 1998--Viking Resources International Inc. (OTC BB:VIKG) announced Wednesday that it has signed a Memorandum of Understanding with Executive Jetport of NJ Inc. (EJP).
Located at New Jersey's Trenton-Mercer Airport, EJP (or ''the Jetport'') holds a 30-year lease for 27 acres of land and buildings providing Fixed Base Operation (FBO) services to the aviation industry. A former Naval base, the property is on the site of the former General Motors factory where Grumman TBM torpedo bombers were built under license during World War II. EJP was the successful bidder for the property, which includes two 10-year extensions on the lease.
Under the terms of the agreement, Viking and its financial partner, Hampton Group LLC, will fund (or cause to be funded) a total of $1.95 million - $1.35 million in cash, $500,000 in stock and $100,000 in either cash or stock at Viking's option. The payout on this transaction is as follows: $750,000 in cash over the next six weeks; $500,000 in cash and $500,000 in Viking restricted common stock payable in eight equal monthly installments beginning 60 days after the start of fuel operations scheduled for mid-September; $100,000 in cash or Viking restricted common stock at Viking's option no sooner than Jan. 1, 1999; and a $100,000 final payment which will cause to be issued a 50% ownership of EJP to Viking. Viking's financial contributions are secured by a first lien against EJP's equipment.
With anticipated first year revenue conservatively estimated at $10 million, the net profit would be $2 million. EJP's FBO is expected to generate revenue upwards of $36 million annually by its fifth year. Considering a $1.5 million first year breakeven point, Viking anticipates this joint venture to result in exceptional cash flow and profitability. As a part of the 50% Joint Venture arrangement, Viking will participate in the management of the FBO including an equal representation on EJP's board of directors.
According to data from a 1996 study completed by the National Business Aircraft Association, 94% of the Forbes ''Top 50'' corporations operated general aviation aircraft at that time. Since the New Jersey aviation market approaches $36 billion annually, EJP offers the opportunity for an attractive alternative to the crowded airport conditions in the tri-state area. Situated midway between Philadelphia and New York City, EJP owns the largest FBO fuel farm in the United States with 18 25,000-gallon fuel tanks. EJP has entered into a contract with Exxon Oil Co. to supply jet fuel to the tank farm and Exxon will also provide three fuel trucks -- two 3,000 gallon and one 1,000 gallon to EJP for use in fueling aircraft. EJP has contracts to provide ground services, fueling and office leasing to EastWind Airlines of Greensboro, N.C. with service to Boston, Trenton, Washington, D.C., Greensboro, Orlando, Tampa and Fort Lauderdale; and with SkyTrek International Airlines. The Jetport is currently in negotiations with New England-based Business Express Airlines, a commuter service feeding into Delta, American and Northwest Airlines; and with Houston-based Shuttle America Airlines to provide ground service, fueling and possible leasing of office space.
In addition to fueling services, the Jetport will provide service, maintenance and storage facilities to its customers, including the installation of aircraft engine ''hush kits'' required by federal noise pollution regulations with time-limited mandates. The net revenue estimated for these installations is approximately $350,000 per aircraft at the rate of four installations per month. The Jetport has plans in place to build two additional 100,000 square foot hangars dedicated to the service and maintenance of jet aircraft. These new hangars will be entirely subsidized by the airlines whose equipment will be maintained. The maintenance center at EJP will be FAR Part 145 licensed and certified in FAR Part 121 Commercial Aircraft Operations. Federal Aviation Regulations or ''FAR'' are the governing rules of the Federal Aviation Authority in licensing FBO's.
Currently housed in a 100,000 square foot office/hangar facility, EJP has completed engineering and architectural specifications to renovate and enlarge this space. The resulting four-story building will include the Jetport's corporate headquarters, a customer/passenger terminal consisting of a three-story open atrium with glass elevator and fourth floor enclosed observation deck with outside access as well as a fifth floor conference center with a panoramic view of the airport facility. This new complex with 24-hour access will provide office space for aviation-related businesses and will include state-of-the-art pilots' lounge and quarters, briefing rooms, weather rooms, an exercise center with sauna, a casual-dining restaurant, duty-free and customs services allowing for international travel, and aircraft storage. The ramp area will cover over 650,000 square feet of ground with parking for over 50 aircraft. Through FAR Part 135, EJP plans to add charter services, aircraft sales, and avionics sales and service.
According to Thomas E. Patterson, CEO of Executive Jetport of NJ Inc.: ''The use of business aircraft by smaller companies has escalated as various chartering, leasing, time-sharing, interchange agreements, partnerships and management contracts have emerged. It is a rare opportunity that acreage, buildings and location form such a perfect setting for the development of an FBO. With a minimum 20-year growth rate anticipated for this type of business, we believe we are uniquely positioned to capture multiple streams of revenue related to the aviation industry. We are excited about this new joint venture with Viking and look forward to a long and successful relationship.'' Viking's President Dan O. Erickson stated: ''Although this joint venture with EJP may appear to our shareholders to be a departure from our core business, I believe Viking will benefit considerably from the breadth of business and positive cash flow that this affiliation with EJP will provide. Due to the delays encountered by Mr. Kuhr, I felt it was important to bring this deal forward and provide Viking with a solid, high-profile and exciting business venture. With the able assistance of our new financial advisors, Viking will continue to work to bring value to our shareholders.''
Viking Resources International Inc. is a diversified holding company with a strategy of expansion through development and acquisition with a focus in the global environmental and recycling industry.
Except for any historical information presented, the matters discussed in this release are forward looking statements and are subject to risks and uncertainties that could cause actual results to differ materially.
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Contact:
Investor Relations, 800/777-0264
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