UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended:  October 31, 2010

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 number 000-27011

ALPINE AIR EXPRESS, INC.

(Exact name of registrant as specified  in its charter)

1177 Alpine Air Way

Provo, UT 84601

 (Address of principal executive offices)

(801) 373-1508

(Registrant’s telephone number, including area code)

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

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.001

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] No [X]

Indicate by check mark if  the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes [  ]   No [X]

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.

(1) Yes [X] No [  ]     (2) 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 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. [   ]

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company:

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [  ] No [X]

State the aggregate market value of the voting and non-voting common stock held by non-affiliates computed by reference to the price at which the common stock was last sold, or the average bid and asked price of such common stock, as of the last business day of the Registrant's most recently completed second fiscal quarter.

April 30, 2010 - $776,306  There are approximately 7,057,327 shares of common voting stock of the Registrant beneficially owned by non-affiliates.  There is a limited public market for the common stock of the Registrant, so this computation is based upon the bid price of $0.11 per share of the Registrant's common stock on the OTC Bulletin Board as of April 30, 2010.

APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Not applicable.

Indicate the number of shares outstanding of each of the registrant’s classes of common equity, as of the latest practicable date:

January 26, 2011:  Common – 36,059,481

January 26, 2011:  Preferred – 780,000

PART I

ITEM 1. DESCRIPTION OF BUSINESS

Background.

     Alpine Air Express, Inc., a Delaware corporation ("Alpine Air" or the “Company”), is engaged in the air cargo business through its wholly owned subsidiary, Alpine Aviation, Inc., a Utah corporation ("Alpine Aviation" or “Alpine”).  Alpine Aviation was organized on October 7, 1975, in the state of Utah.  Alpine Aviation has been operated by the same management since 1986.  Alpine Aviation is an air cargo operator, transporting mail packages and other time-sensitive cargo to 19 cities in the western portion of the mainland United States. Alpine Aviation began its operations in the 1970's with the intent of being a regional charter and cargo carrier.  After present management acquired control in 1986, Alpine Aviation began to focus less on the charter or passenger services and more on the cargo aspects of the airline industry.  Since the 1990's, Alpine Aviation has focused on transporting mail for the United States Postal Service (USPS) and carrying packages for a large nationwide carrier because of their favorable contracts, routes, and payment practices.  As a result of this focus, approximately 92% of Alpine Aviation's revenues now come directly from these two customers.

     Alpine Air Express was formed in April, 1994, under the name "Riverside Ventures, Inc."  Prior to its acquisition of Alpine Aviation in June, 2000, Alpine Air Express had no business operations and was actively looking for a business with which to merge or acquire in an effort to create an operation that would provide value to our shareholders.

     On June 12, 2000, Alpine Air Express, under its former name, entered into an agreement and plan of reorganization with Alpine Aviation, pursuant to which Alpine Air acquired all of the outstanding shares of Alpine Aviation. Pursuant to the terms of the reorganization, Alpine Air Express issued 9,895,000 shares of its common stock to the stockholders of Alpine Aviation in exchange for all of the issued and outstanding shares of Alpine Aviation.  As a result of the reorganization, Alpine Aviation became a wholly owned subsidiary of Alpine Air Express.  As a further result of the reorganization, the management of Alpine Aviation assumed control over Riverside Ventures and changed the company's name from "Riverside Ventures, Inc." to the current name of "Alpine Air Express, Inc."  The reorganization has been treated as a "reverse merger," with Alpine Aviation as the surviving entity for accounting purposes and Alpine Air the surviving entity for corporate purposes. At the time of the reorganization, Alpine Air Express had 1,000,000 shares of common stock outstanding.  Following the reorganization, Alpine Air had 10,895,000 shares outstanding, which was composed of the 1,000,000 shares outstanding prior to the issuance of shares for Alpine Aviation and the 9,895,000 newly issued shares to the Alpine Aviation stockholders.  Alpine Air subsequently issued an additional 105,000 shares, bringing the total outstanding shares to 11,000,000 as of 2003. During 2004 and 2005 the Company issued 122,000 shares, bringing the total outstanding shares to 11,122,000 at 2005.  In 2006, Alpine Air effected a 3 for 1 stock split and issued additional shares for compensation during 2006 resulting in a total of 36,271,461 outstanding shares at both October 31, 2006 and 2007. Unless otherwise indicated all share calculations in this Annual Report take into account this stock split. During 2010 the Company retired 141,320 shares it held in Treasury Stock reducing the total of outstanding shares to 36,130,141. During 2010 the Company purchased 70,660 shares to hold as Treasury Stock.

Routes and Delivery.

     Alpine Aviation currently has 23 air cargo routes covering 19 cities in six western states in the mainland U.S. Alpine also provides contract cargo charter flights for other carriers and for the public.  Most routes are flown every day and some multiple times per day.  In fiscal 2010, Alpine Aviation transported 8,444 tons of cargo.  The largest component of Alpine Aviation's cargo mix is U.S. mail, which accounted for approximately 69% of our fiscal 2010 revenue. The USPS delivers and picks up all cargo Alpine Air carries at the aircraft, unless other arrangements are called for separately by the contract.  When the USPS delivers and picks up the mail at the side of the aircraft, Alpine Air is able to reduce its costs significantly.

     Alpine currently operates 23 aircraft on one national certificate.  The largest aircraft in its fleet is a Beechcraft 1900, which holds approximately 6,000 pounds of cargo.  The other aircraft type is the Beechcraft 99, which holds approximately 3,400 pounds of cargo. The Company also owns 3 Beechcraft 1900-D aircraft (passenger configuration) and currently leases them on an annual lease basis.

Industry overview.

     The package delivery and air cargo business has evolved rapidly over the last two decades, driven by the integration of world markets, the rationalization of corporate supply chains and the implementation of enterprise software and internet-based information technology solutions. The ability to provide time-definite delivery options and transfer information increasingly determines success.  Customer demands for real-time information processing and worldwide distribution and logistics capabilities favor companies with integrated services.

     Customers increasingly focus on the timing and predictability of deliveries rather than the mode of transportation. As customers re-engineer the total distribution process, which includes order processing, administration, warehousing, transportation and inventory management, they attempt to reduce the most expensive and fastest growing component, inventory carrying costs. Time-definite transportation, which is no longer limited to air express, has become a critical part of just-in-time inventory management and improving overall distribution efficiency.

     Technology advances have made it easier for companies to analyze and compare distribution options.  As a result of these changes, individual shipments are generally smaller but more frequent and a greater proportion of products are being delivered directly to end-users, particularly as e-commerce takes hold.  Customers expect high performance levels and broad product offerings as they seek to optimize supply chain solutions.

    There has been dramatic growth in the utilization of e-commerce by both consumers and businesses for the transfer of goods.  Consumers who use the internet for home shopping and other services shop across borders and require global delivery capabilities.

     Delivery of packages to a specific destination at a guaranteed time has been the growth engine for the package delivery industry over the past decade. The industry has become increasingly dominated by large integrated carriers such as UPS and FedEx that provide seamless services, including pick-up and delivery, shipment via air and/or road transport and customs clearance. The pace of consolidation in the package delivery industry has increased on a global scale.

     Industry participants are acquiring, merging with or forming alliances with partners that can expand global reach, breadth of services or technological capabilities in order to better enable those participants to compete in a rapidly changing global environment.  In particular, government-run post offices have made several recent alliances with and acquisitions of private-sector companies.  Post offices, which still maintain numerous advantages over private-sector companies, create significant challenges for competitors worldwide.

     With the growth in cargo and e-commerce taking a greater hold, we feel the need for companies like Alpine Air will only continue to expand.  We offer the ability to deliver mail and cargo to smaller markets without many of the associated capital costs.

Employees.

     Alpine Air has 109 employees, 61 of which are full time, including 10 in administration and 62 in flight operations, which includes 23 pilots.  No employees belong to any labor union or have employment contracts.

ITEM 1A. RISK FACTORS

     Not applicable to smaller reporting companies.

ITEM 1B. UNRESOLVED STAFF COMMENTS

     Not applicable to smaller reporting companies.

ITEM 2. DESCRIPTION OF PROPERTIES

     Alpine Air is headquartered in its owned facility located in Provo, Utah.  This facility is on leased property at the Provo Municipal Airport. The hangar consists of approximately 25,000 square feet with attached corporate offices and has been valued at a cost of approximately $1,200,000.

     The company also leases an 11,450 square foot hangar and a separate maintenance facility in Billings, Montana at the Logan International Airport and has permits to lease and use hangar and office space with the State of Hawaii, Department of Transportation.

     Alpine Air carries extensive insurance coverage on all facilities as well as aircraft.  Management believes the insurance coverage is adequate to cover any damage to its’ facilities or aircraft and any resulting liabilities.  

     Alpine Air operates the following aircraft:

     All aircraft are in working condition and alternately either in maintenance or assigned to a scheduled route.

ITEM 3. LEGAL PROCEEDINGS

During the reporting period, the Company received three notices from the Federal Aviation Administration (FAA) that the FAA was going to impose civil penalties for alleged violations of FAA regulations. Company management immediately began countering those allegations and assessed the probability of actually having monetary penalties imposed against the Company. The Company estimated the amount of the possible penalties and accrued a reasonable amount to cover the potential assessments all while vigorously contesting the allegations. Subsequent to the end of the reporting period, two of the three notice actions were negotiated with the FAA resulting in substantially reduced penalties, well within the established reserves and with no further enforcement action by the FAA.

     During the reporting period, the Company contested a billing from a service provider based upon the service provider’s Fee Agreement. The matter was submitted to arbitration by the service provider which was contested by the Company. Subsequent to the end of the reporting period, the matter was resolved by settlement between the parties and the arbitration matter was dismissed as part of the settlement.

     Alpine Air Express has evaluated events for the period October 31, 2010 through January 26, 2011, the date the financial statements were issued, and concluded there were no other events or transactions during this period that required recognition or disclosure.

ITEM 4. (REMOVED AND RESERVED)

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

     Alpine Air's common stock is currently quoted on the National Association of Securities Dealers Electronic Bulletin Board under the symbol "APNX". Set forth below are the high and low closing bid prices for our common stock for each quarter during our two most recent fiscal years.  These bid prices were obtained from Yahoo Finance (available on the internet). All prices listed herein reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not represent actual transactions.

     We cannot guarantee that the present market for our common stock will continue or be maintained, and the resale of "unregistered" and "restricted" shares pursuant to Rule 144 of the Securities and Exchange Commission may substantially reduce the market price of our common stock.

Holders.

     As of January 26, 2011, there were 36,059,481 shares of common stock outstanding held by approximately 439 active holders of record, including broker-dealers and clearing corporations holding shares on behalf of their customers, as reported by the Company's transfer agent.  This figure does not include an indeterminate number of stockholders who may hold their shares in street name.

Dividends.

     Since its inception, Alpine Air has paid no dividends on its common stock, and we do not anticipate that we will pay any dividends in the foreseeable future.

Securities Authorized for Issuance Under Equity Compensation Plans.

                    Equity Compensation Plan Information

Recent Sales of Unregistered Securities.

     Alpine Air has not sold any equity securities during the period covered by this Annual Report that were not registered under the Securities Act of 1933, as amended.  

Purchases of Equity Securities by the Issuer and Affiliated Purchasers.

     During the quarterly period ended October 31, 2010, neither Alpine Air nor any “affiliated purchaser” as defined in Reg. Section 240.10b-18(a)(3) purchased any of Alpine Air’s common equity.

ITEM 6.  SELECTED FINANCIAL DATA

     Not applicable to smaller reporting companies.

ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General.

     Alpine Aviation Inc. provides air cargo transportation services in the United States in Montana, North Dakota, South Dakota, Wyoming, Nebraska, and Colorado.  While the USPS is our primary customer, we also provide contract cargo and charter services for other package delivery and cargo carriers. In addition to air cargo transportation, the Company provides maintenance service on aircraft owned or operated by third parties, leasing of passenger aircraft, and operates a First Officer Training Program.

     Revenues were $20.1 million in 2010, a 1.7% decrease from $20.4 million in 2009.  The primary decrease in revenues was the result of the loss of our Hawaii USPS contracts on August 7, 2009, but was mostly offset by a revenue increase on our 2010 fiscal year due to the award in September 2009 of the Montana, South Dakota, and North Dakota USPS contracts at increased rates as well as the leasing of one additional 1900-D passenger aircraft in December 2009.

     During the quarter ending July 31, 2009, the Company learned that the US Postal Service did not renew the contracts in place in Hawaii. These contracts expired June 6, 2009 and Alpine Air signed a two month contract to fly several routes with the company that was awarded the contract. That contract expired on August 7, 2009 and Alpine Air discontinued operations in Hawaii. Seven aircraft were redeployed to the mainland. Four of these aircraft were immediately used to end month-to-month leases with third parties, two aircraft are being used as additional aircraft in the Billings, MT operations to take advantage of extra charter opportunities as they arise and as backup spare aircraft in the event an aircraft needs maintenance. One aircraft was sold in May 2010.  

     In September 2009 the Company was successful in its attempts to keep the Montana/South Dakota/North Dakota contract with the US Postal service at an increased rate. The contract began on September 5, 2009 and runs for six years through September 5, 2015. In the future, if the Company were unable to renew this contract, it would have a

significant impact on earnings and revenues. However, management has had substantial success in renewing contracts with the USPS over the past 20 years.

     In fiscal 2010, the Company carried over 8,444 tons of cargo as compared to 9,673 tons in fiscal 2009. This decrease is directly attributable to the loss of the Hawaii USPS contracts in August 2009.

     The Company experienced rising costs for fuel in fiscal 2010. This cost increase along with the need to continue maintenance and repair of our aircraft place a strong demand on our cash resources.

     During fiscal 2010, the Company acquired one additional Beechcraft 1900-D passenger aircraft and sold one Beechcraft 1900-C aircraft.

Liquidity and Capital Resources.

October 31, 2010 and 2009.

Historical Source of Cash and Capital Expenditures:

     The Company has a working capital position on October 31, 2010 of $2,255,625, as compared to working capital on October 31, 2009, of $669,987. The increase in working capital has been the direct result of a $350,315 increase in current assets coupled with a decrease of $1,235,323 in current liabilities. The Company presently has no material off-balance sheet financing arrangements.   

     Total assets increased to $27,783,424 on October 31, 2010 from $26,560,224 on October 31, 2009. Total liabilities decreased to $12,306,428 from $12,552,207 during the same period. Total stockholders' equity has also increased a total of $1,468,979, from $6,542,737 to 8,011,716 for October 31, 2009 and October 31, 2010, respectively.

     For the year ended October 31, 2010 there was a net profit from operations before income taxes and preferred stock dividends of $3,500,637. This is an increase from the previous year’s net income of $1,629,011. Depreciation for the year ending October 31, 2010 was $3,208,929 for an increase of $45,792 over last year.

     During the year ended October 31, 2010, the Company decreased the tax NOL carryforward by $2,120,000 resulting in an increase in the deferred tax accounts of $1,460,000.  

     Investing activities for the year ended October 31, 2010, consisted mainly of the purchases of property and equipment of $4,760,576 and the sale of one aircraft for $1,137,020.

     For the year ended October 31, 2010, net cash used in financing activities was $2,452,685, which included funds made available from a new note payable in the amount of $1,922,769. The subsequent use of these funds was the retiring of $2,922,199 of long-term debt, the repayment of a line of credit in the amount of $758,875, the payment of preferred stock dividends of $688,647, and the redemption of $5,733 of Common Stock of the Company.

     For the years ended October 31, 2010 and 2009, net increases in cash and cash equivalents were $143,387 and $297,142, and ending cash and cash equivalents were $1,336,323 and $1,192,936, respectively.

Cash Requirements

     The following table summarizes the Company’s contractual obligations as of October 31, 2010:

*Redemption and/or conversion of preferred shares assumed completed by year 2015 through future cash flows generated by profits from Company operations, sale of excess aircraft, or additional debt borrowings. All preferred shares are owned by the Company’s current CEO and majority shareholder. Currently loan covenants with a lender restrict the redemption and payment of preferred dividends unless the Company maintains minimum net worth of $13,800,000 and debt service coverage of 1.25 to 1.00.

Future Capital Expenditures

     The Company as of December 31, 2010 had an open commitment to purchase one additional Beechcraft 99 aircraft in the amount of $350,000 and one additional Beechcraft 1900C aircraft for $500,000. These additional aircraft will be used in the Company’s aircraft operations.

Results of Operations.

Operating Revenue

     During the year ended October 31, 2010 total operating revenues were $20,118,724, representing a 1.7% decrease compared to 2009 revenues of $20,464,409. The following tables summarize Alpine Air’s operating revenue and associated percentage-of-change for the periods indicated.

Direct Costs

     Total direct costs decreased to $14,149,394 from $15,733,309 for the years ending October 31, 2010 and 2009, respectively. This decrease is mainly due to a decrease in direct labor and benefit costs, decrease in aircraft insurance, and a decrease of $676,929 in aircraft lease expense. Fuel expense increased due to an overall increase in aviation fuel prices across the country and aircraft lease expenses decreased due to the ending of several sale/leaseback agreements. Depreciation and amortization expense for the year ended October 31, 2010 increased to $3,295,107 from $3,163,137 during 2009. This increase was due to additional depreciation on one new aircraft

acquired at the beginning of 2010 and from major engine and airframe component overhauls capitalized in 2010. The following table summarizes Alpine Air’s direct costs and the associated percentages-of-change for the periods indicated.

     Operating Expenses

     Operating expenses decreased to $1,989,749 from $2,180,645 for the years ended October 31, 2010 and 2009, respectively. This decrease was due mainly to labor and benefit cost reductions. Consulting expenses, legal expenses, and professional accounting expenses decreased during 2010. The Company experienced an increase in fines and penalties during 2010 of $223,105. The following table summarizes Alpine Air’s operating expenses and the associated percentages-of-change for the periods indicated.

     Interest Income

     Interest income for the year ended October 31, 2010 decreased to $12,537 from the amount at October 31, 2009 of $18,451. This decrease in interest income for 2010 is due to a reduction of cash in interest bearing accounts and general overall low interest rates for such accounts.

Interest Expense

     Total interest expense for the year ended October 31, 2010 and 2009 was $918,717 and $857,184, respectively. This increase in interest expense is due primarily to the Company paying an interest penalty of $191,928 for the early termination of a capital lease. This lease was refinanced in 2010 to a note payable with more favorable terms.

Gain on Disposal of Assets

     Gain on disposal of assets for the year ended October 31, 2010 increased to $427,236 from $907 as of October 31, 2009. During 2010, the Company sold a Beechcraft 1900 aircraft that resulted in a gain of $441,595.

Other Expenses

     Other expenses for the year ending October 31, 2010 was $0 compared to $83,618 for the year ending October 31, 2009. The 2009 other expenses are due to a realized loss from heating oil investments that were sold in 2009. The Company did not own any heating oil investments in 2010.

Income Tax Expense

     Current income tax expense for the year ended October 31, 2010 and 2009 was $115,000 and $0, respectively. The provision for deferred income tax expense for the year ended October 31, 2010 and 2009 was $1,460,000 and $509,000, respectively. The increase in deferred income tax as a percentage of income before taxes of 41.7% in 2010 and 31.2% in 2009 was due primarily to an expiration of $120,000 of capital loss carryfoward.

Net Income

     For the year ended October 31, 2010 and 2009, income before preferred dividends was $1,925,637 and $1,120,011, or $0.05 per share and $0.03 per share, respectively. For the same periods net income available to shareholders was $1,440,394 and $544,599, or $0.04 per share and $0.02 per share, respectively. The difference for both years presented is $485,243 and $575,412, respectively ($0.01 and $0.01 per share, respectively), which is related to dividends declared on preferred stock and the amortization of a preferred stock discount analogous to a preferred stock dividend. The amortization portion of the preferred stock discount ended in December 2008.

Critical Accounting Policies and Estimates.

     The preparation of the Company's financial statements in conformity with accounting principles generally accepted in the U.S. requires the use of estimates and assumptions to determine certain assets, liabilities, revenues and expenses. Management bases these estimates and assumptions upon the best information available at the time of the estimates or assumptions. The Company's estimates and assumptions could change materially as conditions within and beyond our control change. Accordingly, actual results could differ materially from estimates. The most significant estimates made by management include allowance for doubtful accounts receivable, reserves for excess and obsolete inventories, deferred tax asset valuation,  and valuation of long-lived assets.

     Following is a discussion of critical accounting policies and related management estimates and assumptions.

     Allowance for Doubtful Accounts. An allowance for doubtful accounts receivable in the amount of $33,577 and $66,530, respectively, as of October 31, 2010 and 2009, and was established based on management's estimates of the collectability of accounts receivable. The required allowance is determined using information such as customer credit history, industry information, credit reports, customer financial condition and the collectability of outstanding accounts receivables associated with a discontinued business segment. The estimates can be affected by changes in the financial strength of the aviation industry, customer credit issues or general economic conditions.

     Inventories. The Company's parts inventories are valued at the lower of cost or market. Reserves for excess and obsolete inventories in the amount of $16,609 and $52,523, respectively, as of October 31, 2010 and 2009, are based on assessment of the marketability of slow-moving and obsolete inventories. Estimates are subject to volatility and can be affected by reduced equipment utilization, existing supplies of used inventory available for sale, the retirement of aircraft or ground equipment and changes in the financial strength of the aviation industry.

     Deferred Taxes. The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts and their respective tax bases. 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 based primarily on estimates of current and expected future earnings. Net deferred tax liability of $1,809,000 existed as of October 31, 2010 and net deferred tax assets of $349,000 existed as of October 31, 2009.  

     Revenue Recognition. Cargo revenue is recognized upon completion of contract terms and maintenance revenue is recognized when the service has been performed.  

     Valuation of Long-Lived Assets. The Company assesses long-lived assets used in operations for impairment when events and circumstances indicate the assets may be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amount. In the event it is determined that the carrying values of long-lived assets are in excess of the fair value of those assets, the Company then will write-down the value of the assets to fair value.

Off-Balance Sheet Arrangements.

     None; not applicable.

Safe Harbor Statement.

     Statements made in this Form 10-K which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and business of the Company, including, without limitation, (i) our ability to retain existing commercial relationships and to obtain additional profitable sources of revenue, and (ii) statements preceded by, followed by or

that include the words "may", "would", "could", "should", "expects", "projects", "anticipates", "believes", "estimates", "plans", "intends", "targets" or similar expressions.

     Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond the Company's control) that could cause actual results to differ materially from those set forth in the forward- looking statements, including the following, in addition to those contained in the Company's reports on file with the SEC: general economic or industry conditions, nationally and/or in the communities in which the Company conducts business, legislation or regulatory requirements, the economic condition of the U.S. Postal Service or United Parcel Service, changes in the air cargo, charter and leasing industries, demand for air cargo, charter and leasing services, competition, changes in the quality or composition of the Company's services, our ability to develop profitable new sources of revenue, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting the Company's operations, services and prices.

     Accordingly, results actually achieved may differ materially from expected results in these statements.  Forward-looking statements speak only as of the date they are made.  The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable for smaller reporting companies.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ALPINE AIR EXPRESS, INC.

CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2010 and 2009

ALPINE AIR EXPRESS, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2010 and 2009

CONTENTS

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Alpine Air Express, Inc.

We have audited the accompanying consolidated balance sheets of Alpine Air Express, Inc. as of October 31, 2010 and 2009, and the related consolidated statements of income, stockholders’ equity, and cash flows for the years ended October 31, 2010 and 2009. Alpine Air Express, Inc.’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 Alpine Air Express, Inc. as of October 31, 2010 and 2009, and the results of its operations and its cash flows for the years ended October 31, 2010 and 2009 in conformity with accounting principles generally accepted in the United States of America.

/s/Jones Simkins, P.C.

JONES SIMKINS, P.C.

Logan, Utah

January 20, 2011

The accompanying notes are an integral part of these consolidated financial statements.

2

ALPINE AIR EXPRESS, INC.

CONSOLIDATED BALANCE SHEETS

October 31, 2010 and 2009

ASSETS

LIABILITIES AND STOCKHOLDERS' EQUITY

The accompanying notes are an integral part of these consolidated financial statements.

3

ALPINE AIR EXPRESS, INC.

CONSOLIDATED STATEMENTS OF INCOME

Years Ending October 31, 2010 and 2009

The accompanying notes are an integral part of these consolidated financial statements.

4

ALPINE AIR EXPRESS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Years Ending October 31, 2010 and 2009

The accompanying notes are an integral part of these consolidated financial statements.

5

ALPINE AIR EXPRESS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ending October 31, 2010 and 2009

The accompanying notes are an integral part of these consolidated financial statements.

6

ALPINE AIR EXPRESS, INC

CONSOLIDATED STATEMENTS OF CASH FLOWS

 Years Ending October 31, 2010 and 2009

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

For the year ended October 31, 2010:

·

The Company increased other assets as a result of the capitalization of debt issuance costs of $93,040.

·

Exchanged accounts receivable for property and equipment of $48,822.

·

Increased lease deposit by $24,288 through the issuance of debt.

·

Increased prepaid aircraft insurance by issuing $471,500 of debt.

·

Retired $45,929 of treasury stock.

·

Refinanced $4,267,962 of long-term debt.

For the year ended October 31, 2009:

·

The Company recorded the amortization of a preferred stock dividend and reduced retained earnings by $89,780.

·

The Company acquired property and equipment in exchange for long-term debt of $1,200,000.

·

The Company capitalized debt issuance costs of $70,652.

The accompanying notes are an integral part of these consolidated financial statements.

7

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of Alpine Air Express, Inc. (the "Company") is presented to assist in understanding the Company's financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (USGAAP) and have been consistently applied in the preparation of the consolidated financial statements.

Organization and business description - Alpine Aviation, Inc. (Alpine) was incorporated in the state of Utah on October 7, 1975.  On June 12, 2000 Alpine entered into a transaction that was accounted for as a reverse merger with Riverside Ventures, Inc., a Delaware corporation incorporated on April 20, 1994. At the time of the transaction, Riverside Ventures, Inc. was inactive. All of the outstanding common stock of Alpine was exchanged for 29,685,000 shares of common stock of Riverside Ventures, Inc.  The transaction, accounted for as a reverse acquisition, resulted in a recapitalization of Alpine, inasmuch as it was deemed to be the acquiring entity for accounting purposes. Riverside Ventures, Inc. changed its name to Alpine Air Express, Inc.  The Company is an air cargo operator, transporting mail, packages and other time-sensitive cargo between cities in the western portion of the United States.

Principles of consolidation – The consolidated financial statements include the accounts and operations of Alpine Air Express, Inc., and its wholly-owned subsidiary Alpine Aviation, Inc. as of October 31, 2010 and 2009 (together referred to as the Company). All material inter-company transactions and accounts have been eliminated in the consolidation.

Cash and cash equivalents - The Company considers demand deposits at banks and money market funds at other financial institutions with an original maturity of three months or less to be cash equivalents.  

Restricted cash - At October 31, 2010 and 2009, the Company had two restricted cash time deposits totaling $206,433 and $200,695, respectively, held as collateral for debt and property leases of a third party.

Concentration of credit risk – The Company maintains its cash in bank deposit accounts, which at times, may exceed federally insured limits.  The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents.

Trade accounts receivable – Accounts receivable are amounts due for services performed and are unsecured. Accounts receivable are carried at their estimated collectible amounts. Credit is generally extended on a short-term basis; thus accounts receivable do not bear interest although a finance charge may be applied to such receivables that are past the due date. Accounts receivable are periodically evaluated for collectability based on past credit history with clients. Provisions for losses on accounts receivable are determined on the basis of loss experience, known and inherent risk in the account balance, and current economic conditions.

Inventories - Inventories consist of aircraft parts and fuel stated at the lower of cost or market, determined using the first-in, first-out method (FIFO).

Property and equipment - Provision for depreciation for financial reporting purposes of property and equipment is computed on the straight-line method over their estimated useful lives ranging from three to forty years. Maintenance, repairs, and renewals, which neither materially add to the value of the property and equipment nor appreciably prolong the useful lives are charged to expense as incurred.  Gains and losses on dispositions are included in operations.

Engine overhauls - The Company uses the deferral method of accounting for our major engine and airframe component overhauls and provides for major engine and airframe component overhaul costs to be capitalized and depreciated to the next overhaul on engine and airframe components.

Impairment of long-term assets - The Company reviews all long-term assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable through undiscounted future cash flows. If an impairment loss has occurred, such loss is recognized in the determination of net income.  

8

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [CONTINUED]

Income taxes - The Company utilizes the liability method of accounting for income taxes.  Under the liability method, deferred tax assets and liabilities are determined based on the difference between financial accounting and tax bases of assets and liabilities using enacted tax rates in effect during the years in which the differences are expected to reverse.  An allowance against deferred tax assets is recorded in whole or in part when it is more likely than not that such tax benefits will not be realized.

The Company considers many factors when evaluating and estimating its tax positions and tax benefits. Tax positions are recognized only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the positions will be sustained upon examination. Reserves are established if it is believed certain positions may be challenged and potentially disallowed. If facts and circumstances change, reserves are adjusted through income tax expense. The Company recognizes interest expense and penalties related to unrecognized tax benefits in the provision for income taxes.

Use of estimates - In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenue and expenses during the reporting period.  Actual results could differ from those estimates.

Fair value of financial instruments - Cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities are reflected in the financial statements at fair value because of the short-term maturity of these instruments.  

Income per common share - The Company follows the provisions of ASC Topic 260 "Earnings Per Share".  ASC Topic 260 requires the presentation of basic and diluted earnings per share.  Basic earnings per share are calculated by dividing income (loss) available to common shareholders by the weighted-average number of common shares outstanding during each period. Diluted earnings per share are similarly calculated, except that the weighted-average number of common shares outstanding includes common shares that may be issued subject to existing rights with dilutive potential.  Potential common shares having an anti-dilutive effect on periods presented are not included in the computation of dilutive earning per share.

Revenue and cost recognition - The Company utilizes the accrual method of accounting whereby revenue is recognized when earned. Air freight revenue is recognized upon delivery of cargo to its destination.  Public services revenue consists of charter income, pilot training fees, and customer maintenance services.  Charter income and customer maintenance services income is recognized when the service is performed.  Pilot training revenue is recognized over the course of the program, based on the pro rata share of the course completed to date.  Tuition revenue received, but not yet earned, is deferred.

Recently Enacted Accounting Standards –The Company’s management has evaluated the recently issued accounting pronouncements through the filing date of these financial statements and has determined that the application of these pronouncements will have no material impact on the Company’s financial position and results of operations.

Stock Based Compensation - The Company currently accounts for its stock based compensation in accordance with ASC Topic 718 "Accounting for Stock-Based Compensation." This topic establishes an accounting method based on the fair value of equity instruments awarded to employees as compensation.

Reclassification – The financial statements for periods prior to October 31, 2010 have been reclassified to conform to the headings and classifications used in the October 31, 2010 financial statements.   

9

NOTE 2 - TRADE ACCOUNTS RECEIVABLE

Trade accounts receivable consist of the following:

NOTE 3 - PREPAID EXPENSES

Prepaid expenses consist of the following:

NOTE 4 - INVENTORIES

Inventories consist of the following:

NOTE 5 – PROPERTY AND EQUIPMENT

^{Property and equipment consists of the following:}

Sales/Leasebacks - The Company had a sale/leaseback agreement with a third party, wherein, the Company sold an aircraft for $650,000 and entered into an operating lease (See Note 6).  The Company recorded a deferred gain of $355,716 which was amortized over the life of the lease as an offset to lease expense. This lease ended in May 2009 and the deferred gain has been fully amortized. The Company will lease this aircraft on a monthly, as needed basis.  

The Company had a sale/leaseback agreement with a third party, wherein, the Company sold an aircraft for $650,000 and entered into an operating lease (See Note 6).  The Company recorded a deferred gain of $517,929 which was amortized over the life of the lease as an offset to lease expense.  In addition, $80,000 of the proceeds from this sale are invested in a time deposit as collateral on the lessor’s debt.  These funds are recorded as a restricted time deposit on the Company's records. This lease ended in June 2009 and the deferred gain has been fully amortized. The Company will lease this aircraft on a monthly, as needed basis.

The Company had a sale/leaseback agreement with a third party, wherein, the Company sold an aircraft for $675,000 and entered into a six month operating lease. The Company recorded a gain on the sale of the aircraft during the second quarter of 2006 in the amount of $594,586. There is no continuing commitment on the part of the Company to continue the operating lease beyond six months. In addition, $95,000 of the proceeds from this sale are invested in a time deposit as collateral on the lease. These funds are recorded as a restricted time deposit on the Company records. The Company will lease this aircraft on a monthly, as needed basis.

10

NOTE 6 - OPERATING LEASES

The Company has a 30-year lease agreement with two five-year extension options for real property at the Provo, Utah Airport. The Company also leases a hangar and a maintenance facility in Billings, Montana at the Logan International Airport. The lease for the hangar is for a term of ten years ending October 31, 2017. The lease term for the maintenance facility is one year ending February 20, 2010. These operating lease agreements contain scheduled rent escalation clauses based on changes in the consumer price index. In addition to the operating leases reported above, the Company has two revocable permits (month-to-month leases) with the State of Hawaii, Department of Transportation to use hangar and office space for its air cargo operations and the permits are renewed on an annual basis. The Company has chosen to continue this lease despite not having operations currently in Hawaii. The Company also leases land from a private enterprise for storage of a Company fuel tank.

Future minimum lease payments for the years ending October 31, are as follows:

Total rental expense for the period ending October 31, 2010 and 2009 was $113,498 and $92,728, respectively.

Aircraft - The Company has certain sale/leaseback agreements (See Note 5).  The Company agreed to lease two aircraft for sixty months.  It has also agreed to lease a third aircraft on a month to month basis. The Company is also required to pay an additional amount to the Lessor based on the aircraft’s actual flight time. The Lessor is responsible for engine and propeller overhauls and certain qualifying improvements to all leased aircraft. These aircraft leases ended in 2009 and the Company leased the aircraft on a month to month basis, as needed, during 2010.

Total aircraft lease expense for the years ending October 31, 2010 and 2009 was $68,182 and $220,595, respectively.

NOTE 7 - RELATED PARTY TRANSACTIONS

Personal Guarantee - The Company's major shareholder/officer has personally guaranteed a note which is also collateralized by certain aircraft of the Company.  (See Note 9)

NOTE 8 – LINE OF CREDIT

The Company renewed a $1,000,000 line of credit with a lending institution on February 23, 2010 to help manage cash flow and day to day operations.  The line of credit has a variable interest rate, currently 6.5% and matures on February 23, 2011.  The interest is payable each month on any outstanding balance.  As of October 31, 2010 the outstanding balance was $0. The line of credit is secured by two aircraft, Reg #N194GA and N955AA.

The Company also established a $100,000 line of credit with the same lending institution on August 8, 2006 to help manage cash flow and day to day operations. The line of credit has a variable interest rate, currently 6.5% and matures on August 25, 2016. The interest is payable each month on any outstanding balance. As of October 31, 2010 the outstanding balance was $0. The line of credit is secured by two aircraft, Reg #N194GA and N955A.

11

NOTE 9 – LONG TERM DEBT

Long term debt consists of the following:

The estimated aggregate maturities required on long-term debt for each of the individual years at October 31, 2010 are as follows:

                                                                         2011  $ 1,286,000

                                                                         2012     2,539,771

                                                                         2013        880,886

                                                                         2014        666,524

                                                                         2015      1,526,348

Thereafter     1,668,806

                    $ 8,569,335

NOTE 10 – CAPITAL LEASE OBLIGATIONS

The company leases one aircraft under a capital lease agreement which provides for the option to purchase the aircraft at the end of the lease. The lease is payable in aggregate monthly payments of $24,288, having an imputed interest rate of 7.924%, and is secured by the aircraft being leased. Future minimum lease payments under capital leases are approximately as follows:

Year Ending

October 31,

Amount

2011

 $

291,456

2012

291,456

2013

291,456

2014

    24,288

898,656

Less amount representing interest

(103,675)

Present value of future minimum lease payments

 $

      794,981

12

The cost, accumulated amortization, and amortization expense of aircraft under capital lease is approximately as follows:

NOTE 11 – PREFERRED STOCK

The preferred stock provides for monthly dividends at an annual rate of 6.5%, is non-voting, and is convertible at any time to common stock by the holder based on the current market price of the Company’s common stock. The Company can redeem the preferred stock any time and the Holder can call for redemption of the preferred stock any time after December 1, 2011.

The following table summarizes the changes in preferred stock shares and values.

NOTE 12 – STOCK OPTIONS

The Company’s equity incentive plan allows the Company to issue incentive stock options (ISO's), non-statutory stock options and restricted shares to employees, directors, and consultants of the Company. Annually, commencing January 2002, the aggregate number of shares of the Company's common stock available for award under the plan shall increase by the lesser of 250,000 or seven percent of the outstanding stock less the number of shares previously authorized for the plan, respectively. After August 18, 2011, the plan terminates and no further options may be granted. The exercise price of options granted under the terms of the plan must not be less than 100% of the fair market value of the shares as of the date of grant. Additionally, no individual may be granted more than 100,000 options in any given year. All options issued under the plan are exercisable for ten years and vest after two years. The Company has not received and does not intend to request a determination from the Internal Revenue Service that the options issued under the plan will qualify under the Code for treatment as qualified incentive stock options.

A summary of the options outstanding is presented below:

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NOTE 13 - INCOME PER COMMON SHARE

The following data show the amounts used in computing net income per common share, for the years ended October 31:

For the year ended October 31, 2010 and 2009, 1,397,409 and 1,434,909 outstanding options, respectively, were excluded from the calculation of diluted earnings per share because their effect was anti-dilutive. The Company’s preferred shares do have a dilutive effect and are included in the computation of EPS. The number of preferred shares outstanding and used in the calculation as of October 31, 2010 and 2009 are 820,000 and 820,000 shares, respectively.

NOTE 14 – INCOME TAXES

The provision for income taxes consists of the following:

14

The provision for income taxes differs from the amount computed at federal statutory rates as follows:

Deferred tax assets are comprised of the following:

As of October 31, 2010 the Company has capital loss carryforwards of approximately $84,000 that expire in 2015. The Company also has net operating loss carryforwards of approximately $5,328,000 that expire beginning in 2025.

Tax years ended October 31, 2007, 2008, and 2009 remain open to examination by the federal Internal Revenue Service and for all state taxing authorities.  

NOTE 15 – CONCENTRATIONS

U.S. Postal Service Contracts - The Company receives the majority of its revenues from contracts with the U.S. Postal Service (USPS).  For the year ended October 31, 2010 and 2009, the revenues from contracts with the USPS represented 69% and 65% of total revenues, respectively.  At October 31, 2010 and 2009, accounts receivable from the USPS totaled $966,855 and $759,109 or 60% and 49%, respectively. The contracts currently in effect for USPS routes will expire in September 2015 for mainland US operations. The loss of this customer would have a material negative effect on the operations of the Company.  

NOTE 16 – COMMITMENTS AND CONTINGENCIES

The Company operates its aircraft under a certificate which allows it to accumulate time between overhauls (TBO) in excess of manufacturer's recommendations.  The Company regularly inspects its engines.  A majority of the engines used by the Company have accumulated TBO in excess of manufacturer's recommendations.

Several allegations and proposed penalties have been put forth by the Federal Aviation Administration (FAA) and are currently being reviewed by the Company. Management has assessed the probability and has estimated and accrued a reasonable amount to cover any penalties the Company may incur. None of these assertions have resulted in any enforcement action against the Company, nor does the Company expect any actions as a result of the allegations.

15

NOTE 17 – SUBSEQUENT EVENTS

On November 30, 2010 the Alpine Air Board of Directors approved a one-time redemption of 20,000 shares of Series A 6.5% Preferred Stock of Alpine Air held by Mallette Holdings, LLLP to be redeemed at its stated value of $9.104 per share.

On December 22, 2010 the Alpine Air Board of Directors approved a one-time redemption of 20,000 shares of Series A 6.5% Preferred Stock of Alpine Air held by Mallette Holdings, LLLP to be redeemed at its stated value of $9.104 per share.

On January 5, 2011 Alpine Air purchased one Beechcraft 99 aircraft for $375,000. This aircraft will be used in the Company’s aircraft operations. The purchase of this aircraft released the restrictions on two cash time deposits totaling $206,433 held as collateral for debt of a third party (See Note 1-Restricted  Cash).

The Company as of December 31, 2010 had an open commitment to purchase one additional Beechcraft 1900C aircraft for $500,000. This additional aircraft will be used in the Company’s aircraft operations. As of January 29, 2011, the date the financial statements were issued, the final purchase agreement has not been signed.

Alpine Air Express has evaluated subsequent events for the period October 31, 2010 through January 26, 2011, the date the financial statements were issued, and concluded there were no other events or transactions during this period that required recognition or disclosure in its financial statements.

16

ITEM 9:  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

On February 26, 2009, the Company's audit committee and Board of Directors voted to approve the engagement of Jones Simkins, P.C. of Logan, Utah as principal accountant to audit the Company's financial statements. During the Company's two most recent fiscal years, prior to engaging Jones Simkins, P.C., neither the Company nor anyone on its behalf consulted with Jones Simkins P.C. regarding either: (i) the application of accounting principles to a specified transaction, either completed or proposed; or the type of audit opinion that might be rendered on the Company's financial statements, and either a written report was provided to the Company or oral advice was provided that the new accountant concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement or a reportable event.

ITEM 9A:  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report. Disclosure controls and procedures require that information to be disclosed by the Company in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate to allow timely decisions regarding disclosure.  A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Based on that evaluation, the management concluded, as of the end of the period covered by this report, that the disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission’s rules and forms, and such information was accumulated and communicated to management, including the principal executive officer and the principal financial officer, to allow timely decisions regarding required disclosures.

Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. The Company’s management, with the participation of the principal executive officer and the principal financial officer, evaluated the effectiveness of the Company’s internal control over financial

reporting as of October 31, 2010.  In making this assessment, the Company’s management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework.  Based on this evaluation, management, with the participation of the principal executive officer and principal financial officer concluded that, as of October 31, 2010, internal control over financial reporting was effective.

This Annual Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by the Company’s registered public accounting firm because the Company is neither an “accelerated filer” nor a “large accelerated filer” as those terms are defined by the SEC.

Changes in Internal Control Over Financial Reporting

There have been no changes in internal control over financial reporting during the fourth fiscal quarter of the fiscal year covered by this Annual Report.

ITEM 9B:  OTHER INFORMATION

None; not applicable.

PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Directors and Executive Officers.

     The members of the Board of Directors of Alpine Air serve until the next annual meeting of stockholders, or until their successors have been elected. The officers serve at the pleasure of the Board of Directors.  The following are our directors and executive officers.

     Mr. Mallette began his career with Alpine Aviation in 1979 as its Sales Manager, and then became General Manager later in 1979.  He became Chief Executive Officer and Director upon acquiring Alpine Aviation in 1986.  Prior to his employment by Alpine Aviation, he was employed by the State of Montana as a staff auditor.  He received a B.A. in Business Administration from Carroll College in 1971.  Mr. Mallette holds a commercial pilot's license and maintains his proficiency.  He devotes time to civic and charitable causes and was previously Chairman of the Better Business Bureau of Utah County and Vice-President of the Provo Chamber of Commerce and was named CEO of the Year for Small Public Companies in Utah in 2008.

     Rick C. Wood was named the Principal Financial Officer of Alpine Air in January 2010 after serving as the Senior Accountant and Accounting Manager since February 2006.  He received a Bachelor of Science degree in Accounting from the University of Utah and has served in various accounting capacities for the last ten years. He is currently pursuing a Masters of Accountancy degree from the University of Phoenix in preparation for the CPA exam.  Prior to coming to Alpine Air, he worked as the controller of a local computer company where he began as an Accounting Clerk and Sales Consultant. Prior to his Accounting career, Mr. Wood had a successful sales career with CompUSA, Gateway Computers, American Express, and Qwest Communications. He currently volunteers at his local church tracking donations and expenses.

     Max A. Hansen has been an Alpine Air Director since 1986 and legal advisor to the company since 1979.  He has been practicing law since 1976 and has owned his own firm, Max A. Hansen & Associates, P.C. since 1980.  He is licensed to practice law in Montana, Utah, and California and is admitted to practice before those state courts, the Federal courts of Montana and Utah, and the U.S. Supreme Court. Mr. Hansen provides legal services to Alpine Air as General Counsel.  He is a Past President of the State Bar of Montana and served for many years as the Montana Delegate to the American Bar Association House of Delegates. Mr. Hansen has received distinguished service awards from the State Bar of Montana and the Montana Supreme Court for his work on behalf of the legal system. He is a former member of the American Bar Association Standing Committee on the Federal Judiciary and is still a member of the Sales, Exchanges & Basis Committee of the ABA Tax Section. Mr. Hansen is also President and CEO of American Equity Exchange, Inc., a company which assists taxpayers with Section 1031 tax-deferred property exchanges nationwide. He is a Past President and sits on the Board of the Federation of Exchange Accommodators and holds a designation as a Certified Exchange Specialist (CES). Mr. Hansen received his law degree from the University of San Diego School of Law in 1976, where he was a member of the Law Review.  He received a BA in Political Science from Carroll College in 1971.

     Joseph O. Etchart has been a member of our Board of Directors since April, 2002.  He formerly served as Alpine Air's Director of Public and Investor Relations.  He is also the President and CEO of Hinsdale Land Company, a real estate and agricultural enterprise in Montana.  Since 1985, Mr. Etchart has served on the Board of Directors, and is a former Chairman of the Board, of Montana Livestock Ag Credit, one of the premier agricultural lending institutions in the Pacific Northwest.  He served two terms as President of the Washington, D.C. based National Public Lands Council, where he was involved in the legislative and regulatory process associated with federal land commodity production.  In addition, Mr. Etchart has held numerous civic, political and appointed posts, including Campaign Finance Chairman during the first successful election of Montana Governor Marc Racicot.  Mr. Etchart received a

Bachelor of Arts degree in Sociology from Carroll College in 1970 and is an active member of numerous organizations, including the Knights of Columbus.

     Ronald L. Pattison received his CPA Certificate in August of 1984 after graduating with a B.A. in Business Administration, specializing in Accounting. Ron has specialized in the design and administration of defined contribution plans, but also has a working knowledge of the requirements for defined benefit plans. He was the manager of the Defined Contribution practice group in the Albuquerque, New Mexico office of a national consulting firm. Ron left that practice in December of 1990 to start Pattison Pension Specialists, Inc., where he is currently a principal.

Nominees to Board of Directors

   During the period covered by this Annual Report, the Company has made no material changes to the procedures by which security holders may recommend nominees to its Board of Directors.

Audit Committee

     Alpine Air established a standing audit committee in the first quarter of its 2002 fiscal year.  The committee has adopted a charter and currently consists of three members, Ron Pattison (Chair), Joe O. Etchart, and Max A. Hansen (Ex Officio).  Alpine Air does not have standing nominating committee.

Audit Committee Financial Expert

     The Board of Directors has determined that the Chairman of the Audit Committee, Ron Pattison, qualifies as “audit committee financial expert” as defined by the SEC and also meets the additional criteria for independence of Audit Committee members set forth in Rule 10A-3(b)(l) under the Securities and Exchange Act of 1934.

Identification of Certain Significant Employees.

     Alpine Air has no employees who are not executive officers but who make or are expected to make significant contributions to Alpine Air.

Family Relationships.

     Joe Etchardt is the brother-in-law of Ron Pattison. Messrs. Etchardt and Pattison are both directors of the Company.

     Except as indicated below, to the knowledge of management, during the past 10 years, no director, person nominated to become a director, executive officer, promoter or control person of Alpine Air:

     (1) filed a petition under the Federal bankruptcy laws or any state insolvency laws or was a general partner or executive officer of any business entity that filed any bankruptcy petition or for which a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, either at the time of the bankruptcy or two years prior to that time;

     (2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

     (3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting the following activities:

(i)  acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;

(ii) engaging in any type or business practice; or\

(iii)  engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;

     (4) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (f)(3)(i) of Item 401 of Regulation S-K promulgated by the SEC, or to be associated with persons engaged in any such activity;

     (5)  was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;

     (6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodities Futures Trading Commission has not been subsequently reversed, suspended or vacated.

(7)  was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

(i)  any Federal or State securities or commodities law or regulation; or

(ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or

(iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

  (8)   was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

Code of Ethics.

     We filed our Code of Conduct for our executive officers with our Amended 10KSB dated October 31, 2003, and filed with the Securities and Exchange Commission on March 19, 2004.

Compliance with Section 16(a) of the Exchange Act.

     Based solely on a review of Forms 3 and 4 and amendments thereto furnished to us during its most recent fiscal year and Forms 5 and amendments thereto furnished to us with respect to our most recent fiscal year, and any written representations referred to in Item 405(b)(1) of the SEC, Alpine Air believes all forms required to be filed under Section 16 of the Exchange Act have been timely filed.

     On January 9, 2004, our Board of Directors adopted an Insider Trading Policy.  The purpose of this Policy is to ensure that our directors, executive stockholders and 10% stockholders comply with Section 16(a) of the Exchange Act and to establish procedures by which our insiders may buy and/or sell our common stock without violating the securities laws' prohibition against insider trading.

ITEM 11.  EXECUTIVE COMPENSATION

     The following tables set forth certain summary information concerning the compensation paid or accrued for each of Alpine Air's last three completed fiscal years to Alpine Air or its principal subsidiary Chief Executive Officer and each of its other executive officers that received compensation in excess of $100,000 during such period (as determined at October 31, 2010, the end of Alpine Air's last completed fiscal year). Unless indicated otherwise, all share figures in this Item reflect the three-for-one split of our issued and outstanding common stock in January, 2006.

     Summary Compensation Table.

SUMMARY COMPENSATION TABLE

      Options/SAR Grants.

     During the year ended October 31, 2008 Alpine Air issued options to purchase 5,000 shares each to the CEO, Eugene Mallette, the General Manager, Bill Distefano, and the Principal Financial Officer, Rick Wood. These were issued as part of the same option grant offered to all full-time employees in July of 2008.

     There were no options to purchase shares issued during 2009 and 2010.

     Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR Value Table.

     No stock options or SARs were exercised during the fiscal year ended October 31, 2010 and 2009.

     Pension Table.

      None.

     Compensation of Directors.

     During the fiscal year ended October 31, 2010, no stock options were issued to any director. Board of Directors fees were $4,000 per quarter for services rendered.

     During the fiscal year ended October 31, 2009, no stock options were issued to any director. Board of Directors fees were $4,500 per quarter for services rendered.

     During the fiscal year ended October 31, 2008, each director was issued stock options to acquire 10,000 shares of common stock. These options have a two year restriction and an exercise price of $0.30 per share.

     Termination of Employment and Change of Control Arrangement.

     There are no compensatory plans or arrangements, including payments to be received from Alpine Air, with respect to any person named in Cash Compensation set out above which would in any way result in payments to any such person because of his resignation, retirement, or other termination of such person's employment with Alpine Air or its subsidiaries, or any change in control of Alpine Air, or a change in the person's responsibilities following a change in control of Alpine Air.

     Stock Option Plan.

     In August 2001, Alpine Air adopted an equity incentive plan.  The plan allows Alpine to issue incentive stock options ("ISOs") within the meaning of section 422A of the Internal Revenue Code of 1986, as amended ("Code"), non- statutory stock options and restricted shares to employees, directors and consultants of Alpine Air.  A total of

770,000 shares of Alpine Air's common stock have been reserved for issuance under the plan.  As of January of each year commencing in the year 2002, the aggregate number of shares of Alpine Air's common stock that may be awarded under the plan shall automatically increase by a number equal to the lesser of (i) 7% of the total number of shares of Alpine's common stock outstanding, minus the number of shares of stock previously authorized for award under the plan at the close of the preceding calendar year or (ii) 250,000 shares of common stock.

     The exercise price of options granted under the terms of the plan must not be less than 100% of the fair market value of the shares as of the date of grant, or 110% of the fair market value for ISOs granted to optionees possessing more than 10% of the total combined voting power of all classes of stock of Alpine Air for ISOs and 85% of the fair market value of the stock for nonqualified options.  In addition, the aggregate fair market value (as determined on the date of each option grant) of shares with respect to which ISOs are exercisable for the first time by an employee during any calendar year shall not exceed $100,000.  Additionally, no individual may be granted more than 100,000 options in any given year.

     Alpine Air has not received and does not intend to request a determination from the Internal Revenue Service that the ISOs issued under the plan will qualify under the Code for treatment as ISOs.

     The plan provides that an option may be exercised by payment in cash or, with the consent of the Board of Directors, by delivery of common stock of Alpine Air valued at its fair market value on the date of payment.  An option holder shall not have any of the rights of a shareholder with respect to the shares subject to the option until the shares have been fully paid and issued.

     The Board of Directors or a committee of the directors will initially administer the plan, prescribe the form and content of options to be granted, receive elections for the exercise of stock conversion rights, determine the terms and restrictions on all restricted stock awards granted under the plan, and other items.  No stock option can be granted for a period longer than ten years or for a period longer than five years for ISOs granted to optionees possessing more than 10% of the total combined voting power of all classes of stock of Alpine Air.  The right to exercise an option terminates three months after the termination of an employee’s employment, unless the employee dies or is disabled, in which event the option will remain exercisable for a period of one year after the termination of employment.  The plan terminates, and no further options may be granted after August 18, 2011.

     In August 2001, Alpine Air issued options to acquire 547,185 shares of its common stock at an exercise price of $2.50 per share and an option to purchase 79,998 shares at an exercise price of $2.50 per share.  In 2002, Alpine Air issued options to acquire 2,562 shares of its common stock at an exercise price of $2.50 per share.  All options were issued under the plan.  In addition, a total of 75,625 options have been forfeited through October 31, 2005.

     During 2006, the Company issued options to acquire 325,000 shares of its common stock at an exercise price of $0.50 per share, to employees and directors of the company. To date 110,000 of the 2006 options have been forfeited. During 2007, the Company issued options to acquire 425,278 shares of its common stock at an exercise price of $0.40 per share, to employees and directors of the company. To date 124,489 of the 2007 options have been forfeited. During 2008, the Company issued options to acquire 575,000 shares at an exercise price of $0.30 per share. To date, 247,500 of those options have been forfeited. During 2009 and 2010, no options were issued.

     Compensation Committee Interlocks and Insider Participation.

     There are no interlocking relationships between any member of the Company’s Compensation Committee and any member of the compensation committee of any other company, nor has any such interlocking relationship existed in the past. Two members of the Compensation Committee, Eugene R. Mallette, CEO, and Rick C. Wood, Principal Financial Officer, are officers and employees of the Company.

     Compensation Committee Report.

     The Compensation Committee reviews with management the Compensation Discussion and Analysis section of the Company’s 2010 Form 10-K, Item 11, and Proxy Statement. Based on its review and discussions with management the Compensation Committee recommends to the Board of Directors that the Compensation Discussion and Analysis be included in the Company’s Proxy Statement for 2011 and in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2010.

     The Compensation Committee consists of four members, Joe Etchardt (Chair), Ronald L. Pattison, Rick C. Wood (Ex Officio), and Max A. Hansen (Ex Officio).

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

     The following table sets forth information relating to the beneficial ownership of Alpine Air's common stock as of  October 31, 2010 by each person known by Alpine Air to be the beneficial owner of more than 5% of the outstanding shares of common stock and each of Alpine Air's directors and executive officers.

     (1) 15,000 of these shares are in the name of Mary Lou Mallette, Mr. Mallette's wife.

     Unless otherwise noted above, Alpine Air believes that all persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them.  For purposes hereof, a person is deemed to be the beneficial owner of securities that can be acquired by such person within 60 days from the date hereof upon the exercise of warrants or options or the conversion of convertible securities.  Each beneficial owner's percentage ownership is determined by assuming that any warrants, options or convertible securities that are held by such person (but not those held by any other person) and which are exercisable within 60 days from the date hereof, have been exercised.

Changes in Control.

  There are no known arrangements known to Alpine Air, including any pledge by any person of securities of Alpine Air, the operation of which may at a subsequent date result in a change in control of Alpine Air.

Securities Authorized for Issuance under Equity Compensation Plans.

                    Equity Compensation Plan Information