- Quarterly Report (10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the quarterly period ended March 31, 2009

( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ________________ to _________________

Commission File Number: 333-07242

TRB SYSTEMS INTERNATIONAL INC.

---

(Exact name of small business issuer as specified in its charter)

Delaware 22-3522572 ------------------------------------------------------------------------------ (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization)

1472 Cedarwood Drive, Piscataway, New Jersey 08854

---

(Address of principal executive offices)

[phone]

---

(Issuer's telephone number)

N/A

---

(Former name, former address and former fiscal year,
if changed since last report)

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 for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

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 definition of "larger accelerated filer", and "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ] Accelerated filer [ ] Non Accelerated filer [ ] (Do not check if a smaller reporting company) Smaller Reporting Company [X]

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

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 29,319,922 shares of common stock as of May 14, 2009.

TRB SYSTEMS INTERNATIONAL INC.

TABLE OF CONTENTS

Part I. Financial Information Item1. Financial Statements Consolidated Balance Sheets as of March 31, 2009 (unaudited) and June 30, 2008................................................ 4 Consolidated Statements of Operations for the Six- and Nine- Month Ended March 31, 2009 and 2008 (Unaudited)............ 5 Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2009 and 2008 (Unaudited).............................. 6 Notes to Financial Statements....................................... 7 Item 2. Management's Discussion and Analysis or Plan of Operation...... 14 Item 3. Quantitative and Qualitative Disclosures about Market Risk.... 16 Item 4T. Controls and Procedures...................................... 16 Part II. Other Information Item 1. Legal Proceedings............................................ 17 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.. 17 Item 3. Defaults Upon Senior Securities.............................. 17 Item 4. Submission of Matters to a Vote of Security Holders.......... 17 Item 5. Other Information............................................ 17 Item 6. Exhibits..................................................... 17 Signatures............................................................. 18

TRB SYSTEMS INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEET (UNAUDITED)
March 31, 2009

ASSETS March 31, 2009 June 30, 2008 ------------------ ------------------ (Unaudited) (Audited) CURRENT ASSETS: Cash............................................. $ 911 $ 2,064 Accounts receivable, net of allowance for doubtful accounts 365,174 370,295 Inventory........................................ 87,236 85,332 ----------------- -------------- Total Current Assets........................ 453,,221 457,691 Indebtness of related party - patents............ 148,040 157,771 Property and Equipment, net...................... 222,356 259,856 OTHER ASSETS Prepaid and other assets......................... 220,297 160,918 ---------------- -------------- Total Other Assets.......................... 220,297 160,918 ---------------- -------------- Total Assets..................................... $ 1,043,694 $ 1,036,236 ================ ============== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities: Accounts payable and accrued liabilities......... $ 13,037 $ 21,885 Notes and interest payable....................... 340,818 235,583 Advance from a customer.......................... 16,845 - Convertible debts................................ 142,611 142,611 Legal judgments payable.......................... 381,000 381,000 Corporation income tax payable................... 935 935 ---------------- --------------- 895,246 782,014 Indebtness to related party...................... 385,325 499,783 Notes and interest payable....................... 2,617,671 2,578,633 ---------------- --------------- Total liabilities................................ 3,898,242 3,860,430 Stockholders' Equity (Deficit): Common stock: $0.001 par value, 30,000,000 shares authorized; 29,319,922 shares issued and outstanding as of March 31, 2009 and 23,699,922 as of June 30, 2008 29,320 23,700 Additional paid-in capital....................... 3,549,361 3,228,810 Common stock subscribed but not issued........... - 25,000 Retained earnings (deficits)..................... (6,433,229) (6,077,887) Other comprehensive loss - foreign currency...... - (23,817) ---------------- -------------- Total stockholders' equity (deficit)........ (2,854,548) (2,824,194) ---------------- -------------- Total Liabilities and Stockholders' Equity (Deficit) $ 1,043,694 $ 1,036,236 ================ =============== See notes to consolidated financial statements

TRB SYSTEMS INTERNATIONAL, INC.
Statement of Operations

For the Three- and Nine Months Ended March 31, 2009 and 2008

(Unaudited)

Three Months Nine Months Ended March 31, Ended March 31, ----------------------------------------------------- 2009 2008 2009 2008 -------------- ------------- ------------ ----------- Revenue Sales.................................... $ 531 $ 15,594 $ 8,026 $ 87,241 Cost of Goods Sold....................... 346 13,276 5,766 67,811 -------------- ------------- ------------ ----------- Gross Profit........................ 185 2,318 2,260 19,430 License and Distributor Fees............. - 58,742 - 58,742 -------------- ------------- ------------ ----------- Total Revenue....................... 185 61,060 2,260 78,172 Operating Expenses: Advertising.............................. - 19,924 16,728 36,652 Bad debt................................. - - - 1,969,369 Communication............................ 1,632 1,097 1,632 - Consulting............................... - - - 8,662 Depreciation............................. 12,500 1,553 37,500 4,336 Employee salaries........................ 20,023 15,806 45,499 51,190 Marketing & Sales Promotion.............. 29,467 61,984 51,040 111,830 Meals and entertainment.................. 1,010 841 3,462 12,613 Miscellaneous............................ - 42 822 12,959 Office expenses.......................... 3,025 7,746 16,752 30,456 Overseas operating expenses.............. - - - 20,225 Professional fees........................ - - 9,616 13,074 Rents.................................... 3,292 9,157 41,948 18,261 Research and development................. - 443 4,206 24,458 Travel................................... - 1,685 8,897 10,819 -------------- ------------- ----------- ----------- Total operating costs............... 70,949 120,278 238,102 2,324,904 -------------- ------------- ----------- ----------- OPERATING LOSS........................... (70,764) (59,218) (235,842) (2,246,732) OTHER INCOME (EXPENSE) Interest income.......................... 1 60 8 210 Foreign currency translation............. 146 - (4) (64) Bank charge.............................. (28) - (28) - Interest expense......................... (39,757) (108,171) (119,273) (253,325) -------------- ------------- ----------- ------------- Total Other Income & Expenses....... (39,638) (108,111) (119,297) (253,179) NET LOSS BEFORE INCOME TAX & BENEFIT Income Taxes............................. - - - - ------------- ------------ ------------ ------------ NET LOSS................................. $ (110,402) $ (167,329) $ (355,139) $ (2,499,911) ============= ============ ============ ============= Basic and Diluted Earnings (Loss) Per Share $ (0.00) $ (0.01) $ (0.01) $ (0.11) ============ ============ ============ ============ Weighted Average Number of Common Shares Outstanding.......... 29,319,922 23,699,922 26,509,922 23,699,922 ============ ============= ============ ============ See notes to the consolidated financial statements

TRB Systems International, Inc. Statements of Cash Flow For the Nine Months Ended March 31, 2009 and 2008

2009 2008 ------------------ --------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss.......................................... $ (355,139) $ (2,499,911) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation & amortization..................... 37,500 4,336 Comprehensive loss - foreign currency........... 23,614 - Changes in operating assets and liabilities: (Increase) decrease in accounts receivable....... 5,121 2,227,653 (Increase) decrease in other current assets...... - (121,761) (Increase) decrease in inventories............... (1,804) (23,027) Increase (decrease) in accounts payable and accrued liabilities............................. (8,848) (11,226) Increase (decrease) in customer advance.......... 16,845 (154,767) ------------------- ------------- Net cash used in operating activities.............. (282,711) (5,78,703) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment................. - (1,250) (Increase) decrease of other assets................ (59,379) 71,126 Increase (decrease) in indebtedness of related party (104,727) 340,639 ------------------- ------------- Net cash provided by (used in) investing activities (163,886) 410,515 CASH FLOWS FROM FINANCING ACTIVITIES: Issuance of (payment on) notes and interest payable 144,273 136,008 Decrease in common stock subscribed................ (25,000) - Increase in additional paid-in capital............. 326,171 - ----------------- ------------- Net cash provided by financing activities.......... 445,444 136,008 ----------------- ------------- Net increase (decrease) in cash.................... (1,153) (32,180) Cash and cash equivalents, beginning............... 2,064 39,432 ----------------- -------------- Cash and cash equivalents, ending.................. $ 911 $ 7,252 ================= ============== SUPPLEMENTAL DISCLOSURES ON INTEREST AND INCOME TAXES PAID Cash paid during year for interest................. $ 119,273 $ 108,171 ================ ============== Cash paid during year for taxes.................... $ - $ - ================ ============== See notes to the consolidated financial statements

TRB SYSTEMS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements March 31, 2009

1. ORGANIZATION AND NATURE OF BUSINESS

TRB Systems International Inc. ("the Company") is a holding company incorporated in Delaware on April 11, 1997. The Company has established a new subsidiary, Alenax (Tianjin) Bicycle Corp., to conduct business in China. Alenax was incorporated on February 22, 2005 under the laws of People's Republic of China. On December 22, 2008, the corporate name of Alenax (Tianjin) Bicycle Corp. was changed to Alenax Parts (Tianjin) Mfr. Corp. ("Alenax").

The Company was established to produce and market bicycle, fitness and motorized two wheel transportation products. For the period from its inception to date, the Company has been a development stage enterprise, and accordingly, the operations have been directed primarily toward developing business strategies, raising capital, research and development activities, conducting testing of its products, exploring marketing channels and recruiting personnel.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant account policies of TRB Systems International, Inc., is presented to assist in understanding the Company's financial statements. The financial statements and the notes are the representation of the Company's management, who are responsible for their integrity and objectivity. These accounting policies conform to U.S. generally accepted accounting principles and have been consistently applied in the preparation of the financial statements.

a. Liquidity

As of March 31, 2009 the Company had cash and cash equivalents totaling $911 compared to $7,252 at March 31, 2008. As of March 31, 2009, the Company had w orking capital deficiency of $ (442,025) compared to a working capital of $(2,907,514) at March 31, 2008. The Company has outstanding judgments in the amount of $381,000 that is unable to pay within one-year period.

b. Going Concern

The Company incurred accumulated net losses of $6,433,229 from the period of April 11, 1997 (Date of Inception) through March 31, 2009 and has recently commenced limited operations, thus raising substantial doubt about the Company's ability to continue as a going concern. The Company may seek additional sources of capital through the issuance of debt or equity financing, but there can be no assurance the Company will be successful in accomplishing its objectives.

The ability of the Company to continue as a going concern is dependent on additional sources of capital and the success of the Company's plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

c. Basis of Presentation

The financial statements of TRB Systems International Inc. are prepared using the accrual basis of accounting whereas revenues are recognized when earned and expenses are recognized when incurred. This basis of accounting conforms to generally accepted accounting principles in the United States of America.

d. Principles of Consolidation

The accompanying consolidated financial statements include the accounts of TRB Systems International Inc., a non-operating holding company and Alenax Parts (Tianjin) Mfr. Corp., the operating company.

e. Use of Estimates

The preparation of financial statements in conformity with U.S. 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 statements and the reported amounts of revenues and expenses during the reporting period. Estimates are used when accounting for certain items, such as allowances for doubtful accounts, depreciation and amortization, income taxes and contingencies. Actual results could differ from those estimates.

f. Cash and Cash equivalents

For the purpose of the statements of cash flows, the Company considers as cash equivalents: cash on hand, cash in banks, time deposits and all highly liquid short-term investments with maturity of three months or less.

g. Allowance for Doubtful Accounts

The allowance for doubtful accounts is established through a charge to an expense account. The Company reserves based on experience and the risk assessed to each account.

h. Inventories

Inventories consist of bicycles and bicycle parts. Inventories are stated at the lower of cost or market using FIFO (First In, First Out).

i. Property and Equipment

Property and equipment are carried at cost. Depreciation of property and equipment is computed using the straight-line method for financial reporting purposes at rates based on the following estimated useful lives.

Machinery and equipment 3-10 Furniture and fixtures 3-10 Engineering equipment 3-10

For federal income tax purposes, depreciation is computed using the Modified Accelerated Cost Recovery System method (MACRS) therefore temporary differences exist. Expenditures for major renewals and betterment that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs as charged to expense as incurred.

j. Impairment of Long-Lived Assets

The Company has adopted FASB Statements No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the total fair value is less than the carrying value of the asset, a loss is recognized for the difference. Fair value is determined based on market quotes, if available, or is based on valuation techniques.

k. Intangible Assets

Intangible assets subject to amortization include organization costs, loan closing costs, and in-force leasehold costs. Organization costs and in-force costs are being amortized using the interest method over the life of the related loan.

l. Income Tax

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credits carry-forward. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

A valuation allowance is established to reduce the deferred tax asset if it is more likely than not the related tax benefits will not be realized in the future.

m. Comprehensive Income

The Company adopted SFAS No. 130, Reporting Comprehensive Income, which establishes standards for the reporting and display of comprehensive income and its components in the financial statements.

n. Revenue Recognition

License and distributor fees are earned and recognized according to the terms of each agreement.

o. License and Distributor Agreements

The Company's license and distributor agreements provide for compensation to be paid during the first year of the agreements and eventual royalties on the sale of the products. Terms of the agreements typically commence as of the date executed and continue for a period of three years, renewable every three years.

The Company has license agreements in the following countries: Japan, India, Nigeria & Benin, Canada, Ivory Coast, Tanzania, Brazil, Vietnam and Korea.

The Company has distributor agreements in the following states in the United States: California in Orange County and Los Angeles County, Maryland, Delaware and New York in Long Island County and Queens County.

Future Commitments Per Agreements 1st Yr 2nd Yr 3rd Yr Countries States/Counties (Bikes) (Bikes) (Bikes) Total -------------- ----------------- ------------ ----------- ----------- ---------- Japan 40,000 80,000 200,000 320,000 India 50,000 90,000 200,000 340,000 Nigeria & Benin 5,000 9,000 10,000 24,000 Tanzania 1,000 2,000 3,000 6,000 Vietnam 4,000 7,000 10,000 21,000 Korea 13,000 31,000 62,000 106,000 Distributors USA CA-Orange County 1,500 3,000 5,000 9,500 CA-LA County 3,000 5,000 7,000 15,000 Maryland & Delaware 1,000 2,000 2,840 5,840 New York, Long Island/Queens 1,000 2,000 3,000 6,000 ------------------------------------------------------------------------------------

p. Research and Development

Research and product development costs are expensed as incurred. The Company incurred expense of $0 for the three-month period ended March 31, 2009 as compared to $443 for the same period ended March 31, 2008.

q. Net Operating Loss Carry-forward

Income taxes are provided for the tax effects of transactions reported in the financial statements and consists of taxes currently due plus deferred taxes for operating losses that are available to offset future taxable income.

r. Reclassification

Certain account reclassifications have been made to the financial statements of the prior year in order to conform to classifications used in the current year. These changes had no impact on previously stated financial statements of the Company.

s. New Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements, an amendment of Accounting Research Bulletin No 51" (SFAS 160). SFAS 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, changes in a parent's ownership of a noncontrolling interest, calculation and discloure of the consolidated net income attributable to the parent and the noncontrolling interest, changes in a parent's ownership interest while the parent retains its controlling financial interest and fair value measurement ofany retained noncontrolling equity investment. SFAS 160 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. The adoption of SFAS No. 160 has not had a material impact on our financial position, results of operations or cash flows.

In December 2007, the FASB issued SFAS 141R, "Business Combinations" ("SFAS 141R"), which replaces FASB SFAS 141, "Business Combinations". This Statement retains the fundamental requirements in SFAS 141 that the acquisition method of accounting be used for all business combinations and for an acquirer to be identified for each business combination. SFAS 141R defines the acquirer as the entity that obtains control of one or more businesses in the business combination and establishes the acquisition date as the date that the acquirer achieves control. SFAS 141R will require an entity to record separately from the business combination the direct costs, where previously these costs were included in the total allocated cost of the acquisition. SFAS 141R will require an entity to recognize the assets acquired, liabilities assumed, and any non- controlling interest in the acquired at the acquisition date, at their fair values as of that date. This compares to the cost allocation method previously required by SFAS No. 141. SFAS 141R will require an entity to recognize as an asset or liability at fair value for certain contingencies, either contractual or non-contractual, if certain criteria are met. Finally, SFAS 141R will require an entity to recognize contingent consideration at the date of acquisition, based on the fair value at that date. This Statement will be effective for business combinations completed on or after the first annual reporting period beginning on or after December 15, 2008. Early adoption of this standard is not permitted and the standards are to be applied prospectively only. Upon adoption of this standard, there was no impact on the Company's results of operations and financial condition for acquisitions previously completed. The adoption of SFAS No. 141R is not currently expected to have a material effect on its financial position, results of operations or cash flows.

In March 2008, the FASB issued SFAS No. 161 "Disclosures about Derivative Instruments and Hedging Activities--An Amendment of FASB Statement No. 133." ("SFAS 161"). SFAS 161 establishes the disclosure requirements for derivative instruments and for hedging activities with the intent to provide financial statement users with an enhanced understanding of the entity's use of derivative instruments, the accounting of derivative instruments and related hedged items under Statement 133 and its related interpretations, and the effects of these instruments on the entity's financial position, financial performance, and cash flows. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2008. The adoption of SFAS 161 has not had a material impact on our financial position, results of operations or cash flows.

t. Impact of New Accounting Standards

The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company's results of operations, financial position, or cash flow.

3. ACCOUNTS RECEIVABLE

Accounts Receivable represents the balance due from the License and Distributor agreements.

03/31/09 03/31/08 ------------------- --------------- Accounts Receivable $ 365,174 $ 12,114 Less: Allowance for Doubtful Accounts (0) (0) ------------------ --------------- Net Accounts Receivable $ 365,174 $ 12,114 ================== ==============

4. PROPERTY AND EQUIPMENT

Fixed assets are summarized by classifications as follows:

2009 ------------------ Office Equipment $ 77,598 Tools and Machinery 79,321 Automobile 50,947 Moldings 767,518 Booth for Show 137,470 Informational tapes and other promotional materials 50,000 ------------------ 1,162,854 Less: Accumulated Depreciation (940,498) ------------------ $ 222,356 ==================

5. RELATED PARTY TRANSACTIONS

ABL Properties (ABL), wholly owned by Byung Yim, President, CEO of TRB Systems International, Inc. (TRB), and under common control with the Company, owns the patents. These patents are exclusively licensed to TRB Systems Inc, the subsidiary (TRB) for the worldwide manufacture and sale of the Transbar Power System (TPS). The timing, methodology and general details of the manufacture and sales are left to TRB, as is the design and utilization of the goods employing the technology. The rights, licensed to TRB by ABL, call for a payment of $200,000 during the first year of active sales, 1% royalty on annual sales to $10,000,000, 0.75% on sales over $10,000,000 but under $20,000,000, and 0.5% on all sales thereafter. And all profits gleaned from international sales to an aggregate limit of $3,325,000. ABL and the Company agreed to defer payment of the $200,000 until TRB Systems Inc has suitable cash flow to meet its current needs.

Any cost incurred by TRB Systems Inc. to maintain the patents and that calls for reimbursement by ABL according to the agreement, will be used as a credit toward the $200,000 license fees due to ABL on the first anniversary following the commencement of active bicycle sales. As of March 31, 2009 ABL owes the Company $148,040.

During the year Byung Yim, CEO and director of the Company made loans to the Company as the need for additional capital arose. As of March 31, 2009, the outstanding amount due was $385,325.

6. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses also include the capitalized portion of legal and consulting expenses incurred in the development of standardized contacts, promotional materials and the filling and registration of patents, and are amortized over a sixty-month period. As of March 31, 2009 the accounts payable and accrued expenses were $13,037 and $61,674, as of March 31, 2008.

7. NOTES AND INTEREST PAYABLE

Notes payable are unsecured notes to individuals. As of March 31, 2009, the Company had notes payable in the amount of $2,053,856 and accrued interest payable of $904,633. Interest expense attributable to notes payable totaled $119,273 for the nine-month period ended March 31, 2009. Interest rate on the notes ranged from zero to 10%.

8. CONVERTIBLE DEBT

The Company entered into three loan agreements, two for $50,000 on February 29, 2003 and one for $42,611 on January 17, 2003 in the total amount of $142,611. The notes are convertible into shares of the Company's common stock at a price of $1 per share at the lenders option on December 31, 2004. The notes may be required to be repaid if the value per share at the time of conversion falls below $1, at which time the Company will have to repay the face amount of the notes plus (10%) ten percent. As of March 31, 2009 the lenders have not exercised their option, management is negotiating an extension on the notes.

9. JUDGMENTS OUTSTANDING

As of March 31, 2009, there are outstanding judgments in the amount of $381,000 against the Company. Management asserts that negotiations have been initiated to have the amounts reduced but the outcome of such negotiations is uncertain. Management believes the company is not in the financial position to pay these amounts within one-year period and therefore classified the legal judgments payable to long term.

The outstanding judgments consist of:

Creditors / Creditors' Attorneys 2009 2008 ------------------ -------------- David, Kessler & Associates, LLC $ 44,000 $ 44,000 Sawtooth Marketing Group 56,000 56,000 Cole, Schotz, Meiser,Forman & Leonard 89,000 89,000 Bernard & Koff 192,000 192,000 ------------------ -------------- Total $ 381,000 $ 381,000

10. CAPITAL STOCK

The company is authorized to issue 30,000,000 at $0.001 par value share. As of March 31, 2009 the amount of voting common shares issued and outstanding are 29,319,922 and additional paid in capital of $3,549,361.

11. NET LOSS PER SHARE

Net loss per common share for the years ended March 31, 2009 and 2008 is calculated using the weighted-average number of common shares outstanding and common shares equivalents during the periods.

12. INCOME TAX

The net deferred tax asset in the accompanying consolidated balance sheet includes the following components:

2009 2008 ----------------- ---------------- Net Deferred Tax Asset $ 1,508,682 $ 1,384,384 Deferred Tax Asset Valuation Allowance (1,508,682) (1,161,805) ------------------- ---------------- Net Deferred Tax Asset -0- 222,579 ------------------ ---------------- Deferred Tax Benefit -0- $ 23,792 ------------------ ---------------- 13. COMMITMENTS AND CONTINGENCIES

13.1 Lease Commitments

The Company's future annual commitments at March 31 under an operating lease for office space is $1,000 monthly on a month-to-month basis.

13.2 Litigation

As per the Company, as of March 31, 2009 there are no material actions, suits, proceedings or claims pending against or materially affecting the Company, which if adversely determined, would have a material adverse effect on the financial condition of TRB International Systems, Inc. other than the judgments in note 9.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

This quarterly report on Form 10-Q and the materials incorporated herein by reference contain forward-looking statements that involve risks and uncertainties. We use words such as "may," "assumes," "forecasts," "positions," "predicts," "strategy," "will," "expects," "estimates," "anticipates," "believes," "projects," "intends," "plans," "potential," and variations thereof, regarding matters that are not historical facts and are forward-looking statements. Because these statements involve risks and uncertainties, as well as certain assumptions, actual results may differ materially from those expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date that they are made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

The Company conducts its business through its wholly owned subsidiary, Alenax Parts (Tianjin) Mfr.Corp., which develops, markets, and manufactures a line of NMT product. For the three months ended March 31, 2009 and 2008, the Company had net sales of $531 and $15,594, respectively.

For the past two years, the Company focused its efforts on redesigning products, improving product quality, conducting product tests, including strength, durability and road tests. To date, this process is basically completed, and the Company has started to focus on market and sales of our products, but the Company has not been successful in selling its products. As a result, the Company recently changed its business plan from being a high-end bicycle manufacturer and marketer to being a bicycle part manufacturer. The Company will mainly focus on selling and marketing Uni-Set as a bike part maker. Accordingly, the name of the Company's operating subsidiary, Alenax (Tianjin) Bicycle Corp., was changed to Alenax Parts (Tianjin) Mfr. Corp. on December 22, 2008. However, the Company will also take orders for manufacturing /assembling completed bicycles if customers ask us to do so.

For the three months ended March 31, 2009, working with Chinghaur Precision Co. Ltd, the Company improved its Uni-Set parts for expanding varies levels of product quality and price. On the marketing side, the Company (1) attended Taiwan International Bicycle Show; (2) met with The Carrefour of Taiwan and JeonNam Technopark in Korea, (3) met with Goa Cheon City of Korea foe possible exclusive sales and marketing license agreement of Korea; and (4) negotiated actively with The Morning Star Company, a leading fitness manufacturer in Taiwan and China for estimating $5 million for the first year sales, and The DK Tech Co., Ltd. for possible orders.

Results of Operations

For the Three Months Ended March 31, 2009 and 2008

Revenues

For the three months ended March 31, 2009, the Company we had sales of $531, as compared to $15,594 for the same period of the prior year. For the three months ended March 31, 2008, the Company earned $58,742 of license and distributor fees.

Cost of Goods Sold

Cost of goods sold consists primarily of the material cost of goods sold, direct overhead, direct wages, and direct depreciation expense. For the three months ended March 31, 2009 and 2008, our cost of revenues was $346 (for the sale of $531) and $13,276 (for the sale of $15,594) respectively, approximately 65.2% and 85.1% of the sales.

Operating Costs and Expenses

For the three months ended March 31, 2009, our total operating costs and expenses decreased by approximately 41.0%, from $120,278 in 2009 to $70,949 in 2008. The decrease in operating expenses was largely due to decrease in marketing and sales promotion expenses.

Other Income and Expenses

For the quarter ended March 31, 2009, our total other expenses were $39,638, of which $39,757 was interest expense. During the same period of the previous year, our total other expenses were $108,111, which consisted of $108,171 of interest expense and $60 of interest income.

Net Loss

Net loss for the three months ended March 31, 2009 and 2008 were $110,402, or $0.04 per share, and $167,329, or $0.01 per share, respectively.

Liquidity and Capital Resources

Since inception, our operations have been primarily funded by equity capital and unsecured short-term loans from directors and shareholders.

As of March 31, 2009, the Company's cash and cash equivalents balance was $911. For the nine months ended March 31, 2009, net cash was used in operating activities of $282,711, largely due to our net loss of $355,139, increase in depreciation expense of $37,500, foreign currency translation loss of $23,614, decrease in accounts payable of $8,848, and increase in customer advance of $16,845.

During the nine month period, the net cash used in the Company's investing activities was $163,886, mainly due to decrease in indebtness of related party of $104,727 and increase in other assets of $59,159. During the same period, the Company's financing activities provided net cash of $445,444, of which $326,171 was due to increase in additional paid-in capital, and $144,273 was from the issuance of notes and accrued interest.

As disclosed on Item 3, "Legal Proceedings" and Note 9 of our Notes to Financial Statements, as of March 31, 2008, we had outstanding judgment in a total of $381,000 incurred in 2000-2001.

The Company currently lack liquidity and has limited revenues. We will need to raise additional capital, and we are currently considering possible sources of financing, including raising capital through the issuance of equity securities. There can be no assurance that we will be able to raise sufficient additional capital at all or on terms favorable to our stockholders or us.

Off-balance sheet arrangements:

As of March 31, 2008, there were no off-balance sheet arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A smaller reporting company is not required to provide the information in this Item.

ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of our principal executive officer and principal financial officer, we evaluated our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act), and concluded that our disclosure controls and procedures were effective as of March 31, 2009 to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is recorded, processed, and summarized and reported within the time periods specified in SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions as appropriate to allow timely decisions regarding required disclosure.

Inherent Limitations Over Internal Controls

Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to 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 Control Over Financial Reporting.

We have made no change in our internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings: None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds: None.

Item 3. Defaults Upon Senior Securities: None.

Item 4. Submission of Matters to a Vote of Security Holders: None

Item 5. Other Information: None.

Item 6. Exhibits

31. Certification of CEO and CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32. Certification of CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TRB SYSTEMS INTERNATIONAL INC.

By: /s/Byung Yim --------------------------------------------- Byung Yim, President, CEO and CFO Date: May 14, 2009