EX-99.2 4 d92045ex99-2.txt MONTHLY OPERATING REPORT FOR KEVCO MANAGEMENT INC EXHIBIT 99.2 CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS CASE NUMBER: 401-40788-BJH-11 JUDGE: BARBARA J. HOUSER UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF TEXAS -------- ----- FORT WORTH DIVISION ---------- MONTHLY OPERATING REPORT MONTH ENDING: JULY 31, 2001 ------------- IN ACCORDANCE WITH TITLE 28, SECTION 1746, OF THE UNITED STATES CODE, I DECLARE UNDER PENALTY OF PERJURY THAT I HAVE EXAMINED THE FOLLOWING MONTHLY OPERATING REPORT (ACCRUAL BASIS - 1 THROUGH ACCRUAL BASIS - 7) AND THE ACCOMPANYING ATTACHMENTS AND, TO THE BEST OF MY KNOWLEDGE, THESE DOCUMENTS ARE TRUE, CORRECT AND COMPLETE. DECLARATION OF THE PREPARER (OTHER THAN RESPONSIBLE PARTY): IS BASED ON ALL INFORMATION OF WHICH PREPARER HAS ANY KNOWLEDGE. RESPONSIBLE PARTY: /s/ Wilford W. Simpson TREASURER --------------------------------------- ------------------------------ Original Signature of Responsible Party Title WILFORD W. SIMPSON SEPTEMBER 24, 2001 --------------------------------------- ------------------------------ Printed Name of Responsible Party Date PREPARER: /s/ Dennis S. Faulkner ACCOUNTANT FOR DEBTOR --------------------------------------- ------------------------------ Original Signature of Preparer Title DENNIS S. FAULKNER SEPTEMBER 24, 2001 --------------------------------------- ------------------------------ Printed Name of Preparer Date CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 1 CASE NUMBER: 401-40788-BJH-11 COMPARATIVE BALANCE SHEET
SCHEDULED MONTH MONTH ASSETS AMOUNT JULY-01 AUGUST-01 MONTH ------ --------- ------- --------- ----- 1. Unrestricted Cash (FOOTNOTE) 6,557,974 4,259,402 2. Restricted Cash 3. Total Cash 6,557,974 4,259,402 4. Accounts Receivable (Net) 5. Inventory 6. Notes Receivable 7. Prepaid Expenses (FOOTNOTE) 3,450,681 1,108,092 8. Other (Attach List) 263,606 0 9. Total Current Assets 10,272,261 5,367,494 10. Property, Plant & Equipment (FOOTNOTE) 3,285,885 0 11. Less: Accumulated Depreciation/Depletion (1,753,163) 0 12. Net Property, Plant & Equipment 1,532,722 0 13. Due From Insiders 14. Other Assets - Net of Amortization (Attach List) 36,082 0 15. Other (Attach List) (FOOTNOTE) 153,399,371 39,971,438 16. Total Assets 165,240,436 45,338,932 POST PETITION LIABILITIES 17. Accounts Payable 18. Taxes Payable 11,634 19. Notes Payable 20. Professional Fees 21. Secured Debt 22. Other (Attach List) (FOOTNOTE) 2,776,114 23. Total Post Petition Liabilities 2,787,748 PRE PETITION LIABILITIES 24. Secured Debt (FOOTNOTE) 75,885,064 15,071,491 25. Priority Debt (FOOTNOTE) 200,832 91,281 26. Unsecured Debt 1,779,701 1,720,667 27. Other (Attach List) 242,243,558 169,279,290 28. Total Pre Petition Liabilities 320,109,155 186,162,729 29. Total Liabilities 320,109,155 188,950,477 EQUITY 30. Pre Petition Owners' Equity (154,868,719) 31. Post Petition Cumulative Profit Or (Loss) (5,202,539) 32. Direct Charges To Equity (Attach Explanation FOOTNOTE) 16,459,713 33. Total Equity (143,611,545) 34. Total Liabilities and Equity 45,338,932
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. SUPPLEMENT TO CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS - 1 COMPARATIVE BALANCE SHEET
SCHEDULED MONTH ASSETS AMOUNT JUL-01 MONTH MONTH ------ --------- ------ ----- ----- A. Security Deposit 8,794 0 B. Cash Surrender Value: Life Ins. 254,812 0 C. D. E. TOTAL OTHER ASSETS - LINE 8 263,606 0 A. Organizational Costs (FOOTNOTE) 36,082 0 B. C. D. E. TOTAL OTHER ASSETS NET OF AMORTIZATION - LINE 14 36,082 0 A. Intercompany Receivables 113,743,558 0 B. Intercompany Royalties 39,655,813 39,971,438 C. D. E. TOTAL OTHER ASSETS - LINE 15 153,399,371 39,971,438 POST PETITION LIABILITIES A. Accrued Liabilities Other 1,338,789 B. Deferred Compensation 960,371 C. Accrued Health Claims 476,954 D. E. F. G. TOTAL OTHER POST PETITION LIABILITIES - LINE 22 2,776,114 PRE PETITION LIABILITIES A. Intercompany Payables (FOOTNOTE) 113,743,558 40,779,290 B. 10 3/8% Senior Sub. Notes 105,000,000 105,000,000 C. Sr. Sub. Exchangeable Notes 23,500,000 23,500,000 D. E. TOTAL OTHER PRE PETITION LIABILITIES - LINE 27 242,243,558 169,279,290
CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 2 CASE NUMBER: 401-40788-BJH-11 INCOME STATEMENT
MONTH QUARTER REVENUES JUL-01 MONTH MONTH TOTAL -------- ------ ----- ----- ------- 1. Gross Revenues 0 2. Less: Returns & Discounts 0 3. Net Revenue 0 0 COST OF GOODS SOLD 4. Material 0 5. Direct Labor 0 6. Direct Overhead 0 7. Total Cost Of Goods Sold 0 0 8. Gross Profit 0 0 OPERATING EXPENSES 9. Officer / Insider Compensation (FOOTNOTE) 153,348 153,348 10. Selling & Marketing 0 11. General & Administrative 88,795 88,795 12. Rent & Lease 17,456 17,456 13. Other (Attach List) 521,733 521,733 14. Total Operating Expenses 781,332 781,332 15. Income Before Non-Operating Income & Expense (781,332) (781,332) OTHER INCOME & EXPENSES 16. Non-Operating Income (Att List) 8,914 8,914 17. Non-Operating Expense (Att List) 114,757 114,757 18. Interest Expense 0 19. Depreciation / Depletion 35,680 35,680 20. Amortization 0 21. Other (Attach List) 0 22. Net Other Income & Expenses (141,523) (141,523) REORGANIZATION EXPENSES 23. Professional Fees 160,801 160,801 24. U.S. Trustee Fees 0 25. Other (Attach List) 0 26. Total Reorganization Expenses 160,801 160,801 27. Income Tax 0 28. Net Profit (Loss) (1,083,656) (1,083,656)
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. SUPPLEMENT TO CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS - 2 INCOME STATEMENT
MONTH QUARTER OPERATING EXPENSES JUL-01 MONTH MONTH TOTAL ------------------ ------ ----- ----- -------- A. Payroll (FOOTNOTE) 503,153 503,153 B. Insurance 868 868 C. Utilities & Telephone 189 189 D. Taxes 17,523 17,523 E. 0 TOTAL OTHER OPERATING EXPENSES - LINE 13 521,733 521,733 OTHER INCOME & EXPENSES A. Interest and Misc. Income 8,914 8,914 B. Balance Sheet Adjustments 0 C. 0 D. 0 E. 0 TOTAL NON-OPERATING INCOME - LINE 16 8,914 8,914 A. Balance Sheet Adjustments (FOOTNOTE) 114,757 114,757 B. 0 C. 0 D. 0 E. 0 TOTAL NON-OPERATING EXPENSE - LINE 17 114,757 114,757 REORGANIZATION EXPENSES A. 0 B. 0 C. 0 D. 0 E. 0 TOTAL OTHER REORGANIZATION EXPENSES - LINE 25 0 0
CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 3 CASE NUMBER: 401-40788-BJH-11
CASH RECEIPTS AND MONTH QUARTER DISBURSEMENTS JULY-01 MONTH MONTH TOTAL ----------------- ------- ----- ----- ------- 1. Cash - Beginning Of Month SEE ATTACHED SUPPLEMENT AND FOOTNOTE RECEIPTS FROM OPERATIONS 2. Cash Sales 0 COLLECTION OF ACCOUNTS RECEIVABLE 3. Pre Petition 0 4. Post Petition 0 5. Total Operating Receipts 0 0 NON-OPERATING RECEIPTS 6. Loans & Advances (Attach List) 0 7. Sale of Assets 0 8. Other (Attach List) 0 9. Total Non-Operating Receipts 0 0 10. Total Receipts 0 0 11. Total Cash Available 0 0 OPERATING DISBURSEMENTS 12. Net Payroll 0 13. Payroll Taxes Paid 0 14. Sales, Use & Other Taxes Paid 0 15. Secured / Rental / Leases 0 16. Utilities 0 17. Insurance 0 18. Inventory Purchases 0 19. Vehicle Expenses 0 20. Travel 0 21. Entertainment 0 22. Repairs & Maintenance 0 23. Supplies 0 24. Advertising 0 25. Other (Attach List) 0 26. Total Operating Disbursements 0 0 REORGANIZATION DISBURSEMENTS 27. Professional Fees 0 28. U.S. Trustee Fees 0 29. Other (Attach List) 0 30. Total Reorganization Expenses 0 0 31. Total Disbursements 0 0 32. Net Cash Flow 0 0 33. Cash - End of Month 0 0
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. SUPPLEMENT TO ACCRUAL BASIS - 3 JULY, 2001 CASE NUMBER: 401-40788-BJH-11 CASH RECEIPTS AND DISBURSEMENTS
DIST LP MFG MGMT HOLDING COMP KEVCO INC TOTAL ------- ----- --------- ------- ----- --------- --------- 1 CASH-BEGINNING OF MONTH -- 3,739 5,395,155 4,631 5,668 1,000 5,410,193 RECEIPTS FROM OPERATIONS 2 CASH SALES -- -- -- COLLECTION OF ACCOUNTS RECEIVABLE 3 PRE PETITION -- -- -- 4 POST PETITION 47,759 -- 47,759 5 TOTAL OPERATING RECEIPTS 47,759 -- -- -- -- -- 47,759 NON OPERATING RECEIPTS 6 LOANS & ADVANCES -- -- 7 SALE OF ASSETS 482,442 55,779 68,000 606,221 8 OTHER -- 50,449 95,885 -- -- -- 146,334 INTERCOMPANY TRANSFERS 88,194 121,941 (210,135) -- -- -- SALE EXPENSE REIMBURSEMENT LIFE INSURANCE CASH VALUE RENT PAYROLL TAX ADVANCE RETURNED 43,264 MISC. 43,707 -- INTEREST INCOME 8,914 9 TOTAL NON OPERATING RECEIPTS 570,636 228,169 (46,250) -- -- -- 752,555 10 TOTAL RECEIPTS 618,395 228,169 (46,250) -- -- -- 800,314 11 CASH AVAILABLE 618,395 231,908 5,348,905 4,631 5,668 1,000 6,210,507 OPERATING DISBURSEMENTS 12 NET PAYROLL 342,427 9,430 282,924 634,781 13 PAYROLL TAXES PAID -- 238,878 238,878 14 SALES, USE & OTHER TAXES PAID -- -- 15 SECURED/RENTAL/LEASES 15,069 3,223 40,094 58,386 16 UTILITIES 67,481 3,641 13,097 84,219 17 INSURANCE -- 137,376 137,376 18 INVENTORY PURCHASES -- -- 19 VEHICLE EXPENSE -- -- 20 TRAVEL 4,264 -- 4,264 21 ENTERTAINMENT -- -- 22 REPAIRS & MAINTENANCE 2,954 74 5,492 8,520 23 SUPPLIES 3,873 -- 30,637 34,510 24 ADVERTISING -- 25 OTHER 182,327 61,801 183,730 -- -- -- 427,858 LOAN PAYMENTS 55,779 55,779 FREIGHT 14,204 3,126 17,330 CONTRACT LABOR 846 -- 45,359 46,205 401 K PAYMENTS -- -- PAYROLL TAX ADVANCE ADP -- WAGE GARNISHMENTS 1,761 1,761 MISC. 167,277 2,896 136,610 306,783 26 TOTAL OPERATING DISBURSEMENTS 618,395 78,169 932,228 -- -- -- 1,628,792 REORGANIZATION DISBURSEMENTS 27 PROFESSIONAL FEES -- 157,275 157,275 28 US TRUSTEE FEES -- -- 29 OTHER -- 30 TOTAL REORGANIZATION EXPENSE -- -- 157,275 -- -- -- 157,275 31 TOTAL DISBURSEMENTS 618,395 78,169 1,089,503 -- -- -- 1,786,067 32 NET CASH FLOW -- 150,000 (1,135,753) -- -- -- (985,753) 33 CASH- END OF MONTH -- 153,739 4,259,402 4,631 5,668 1,000 4,424,440
CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 4 CASE NUMBER: 401-40788-BJH-11
SCHEDULED MONTH ACCOUNTS RECEIVABLE AGING AMOUNT JULY-01 MONTH MONTH ------------------------- --------- ------- ----- ----- 1. 0 - 30 2. 31 - 60 3. 61 - 90 4. 91 + 5. Total Accounts Receivable 0 0 0 0 6. (Amount Considered Uncollectible) 7. Accounts Receivable (Net) 0 0 0 0
AGING OF POST PETITION MONTH: JULY-01 TAXES AND PAYABLES ---------------
0 - 30 31 - 60 61 - 90 91 + TAXES PAYABLE DAYS DAYS DAYS DAYS TOTAL ------------- ------ ------- ------- ---- ----- 1. Federal 0 2. State 6,412 6,412 3. Local 0 4. Other (See below) 5,222 5,222 5. Total Taxes Payable 11,634 0 0 0 11,634 6. Accounts Payable 0
MONTH: JULY-01 ------------- STATUS OF POST PETITION TAXES
BEGINNING TAX AMOUNT WITHHELD ENDING TAX FEDERAL LIABILITY* AND/OR ACCRUED (AMOUNT PAID) LIABILITY ------- ------------- --------------- ------------- --------- 1. Withholding ** 61,013 (61,013) 0 2. FICA - Employee ** 17,131 (17,131) 0 3. FICA - Employer ** 17,132 (17,132) 0 4. Unemployment 0 0 5. Income 0 6. Other (Attach List) 7. Total Federal Taxes 0 95,276 (95,276) 0 STATE AND LOCAL 8. Withholding 0 0 9. Sales (FOOTNOTE) 6,412 6,412 10. Excise 0 11. Unemployment 0 0 12. Real Property (FOOTNOTE) 0 13. Personal Property 4,167 1,055 5,222 14. Other (Attach List) 0 15. Total State And Local 10,579 1,055 0 11,634 16. Total Taxes 10,579 96,331 (95,276) 11,634
* The beginning tax liability should represent the liability from the prior month or, if this is the first operating report, the amount should be zero. ** Attach photocopies of IRS Form 6123 or your FTD coupon and payment receipt to verify payment of deposit. This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 5 CASE NUMBER: 401-40788-BJH-11 The debtor in possession must complete the reconciliation below for each bank account, including all general, payroll and tax accounts, as well as all savings and investment accounts, money market accounts, certificates of deposit, government obligations, etc. Accounts with restricted funds should be identified by placing an asterisk next to the account number. Attach additional sheets if necessary. MONTH: JULY-01 ----------------
BANK RECONCILIATIONS Account # 1 Account # 2 -------------------- ----------- ----------- A. BANK: Bank of America Bank of America Other Accounts B. ACCOUNT NUMBER: 1295026976 3751629012 (Attach List) TOTAL C. PURPOSE (TYPE): DIP Disbursement Operating Account Account 1. Balance Per Bank Statement 741,411 250,830 3,388,421 4,380,662 2. Add: Total Deposits Not Credited 0 0 3. Subtract: Outstanding Checks (40,861) (13,884) (54,745) 4. Other Reconciling Items (45,683) (20,832) (66,515) 5. Month End Balance Per Books 654,867 250,830 3,353,705 4,259,402 6. Number of Last Check Written N/A N/A
INVESTMENT ACCOUNTS
DATE TYPE OF BANK, ACCOUNT NAME & NUMBER OF PURCHASE INSTRUMENT PURCHASE PRICE CURRENT VALUE --------------------------- ----------- ---------- -------------- ------------- 7. 8. 9. 10. (Attach List) 11. Total Investments 0 0 CASH 12. Currency On Hand 13. Total Cash - End of Month 4,259,402
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. SUPPLEMENT TO CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS - 5 MONTH: JULY-01 ----------------
BANK RECONCILIATIONS Account # 3 Account # 4 Account # 5 -------------------- ----------- ----------- ----------- Bank of America/ Bank of Bank of A. BANK: Nations Funds America America TOTAL B. ACCOUNT NUMBER: 846713 3751775241 3750801912 OTHER BANK Kevco, Inc. S-T Stay Pay ACCOUNTS C. PURPOSE (TYPE): Investment (FOOTNOTE) Payroll-Mgmt 1. Balance Per Bank Statement 2,366,860 984,080 3,966 3,354,906 2. Add: Total Deposits Not Credited 0 3. Subtract: Outstanding Checks 0 4. Other Reconciling Items 0 5. Month End Balance Per Books 2,366,860 984,080 3,966 3,354,906 6. Number of Last Check Written N/A N/A N/A
INVESTMENT ACCOUNTS
DATE OF TYPE OF BANK, ACCOUNT NAME & NUMBER PURCHASE INSTRUMENT PURCHASE PRICE CURRENT VALUE --------------------------- -------- ---------- -------------- ------------- A. B. C. D. TOTAL OTHER INVESTMENT ACCOUNTS - LINE 10 0 0
CASE NAME: KEVCO MANAGEMENT, INC. 2ND SUPPLEMENT TO CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS - 5 MONTH: JULY-01 ----------------
BANK RECONCILIATIONS Account # 6 Account # 7 Account # 8 -------------------- ----------- ----------- ----------- A. BANK: Bank of America Bank of America TOTAL B. ACCOUNT NUMBER: 1295027040 3750768628 OTHER BANK C. PURPOSE (TYPE): Payroll-Dist Payroll-MFG ACCOUNTS 1. Balance Per Bank Statement 28,791 4,724 33,515 2. Add: Total Deposits Not Credited 0 3. Subtract: Outstanding Checks (13,884) (13,884) 4. Other Reconciling Items (20,832) (20,832) 5. Month End Balance Per Books (5,925) 4,724 (1,201) 6. Number of Last Check Written N/A N/A
INVESTMENT ACCOUNTS
DATE OF TYPE OF BANK, ACCOUNT NAME & NUMBER PURCHASE INSTRUMENT PURCHASE PRICE CURRENT VALUE --------------------------- -------- ---------- -------------- ------------- A. B. C. D. TOTAL OTHER INVESTMENT ACCOUNTS - LINE 10 0 0
CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 6 CASE NUMBER: 401-40788-BJH-11 MONTH: JULY-01 ------------------ PAYMENTS TO INSIDERS AND PROFESSIONALS Of the Total Disbursements shown for the month, list the amount paid to Insiders (as defined in Section 101 (31) (A) - (F) of the U.S. Bankruptcy Code) and to Professionals. Also, for payments to Insiders, identify the type of compensation paid (e.g. salary, bonus, commissions, insurance, housing allowance, travel, car allowance, etc.). Attach additional sheets if necessary. INSIDERS
TYPE OF AMOUNT TOTAL PAID NAME PAYMENT PAID TO DATE ---- --------------- ----------- -------------- 1. Sharon Romere Expense Reimb. 383 2. Joe Tomczak Expense Reimb. 626 3. John Wittig Expense Reimb. 263 4. Sharon Romere Payroll 9,615 48,076 5. Joe Tomczak Payroll 177,884 6. John Wittig Payroll 77,404 144,039 7. Will Simpson Payroll 21,635 69,501 Other (see attached) 45,360 131,083 8. Total Payments To Insiders 154,014 571,855
PROFESSIONALS
DATE OF COURT ORDER TOTAL AUTHORIZING AMOUNT AMOUNT TOTAL PAID INCURRED & NAME PAYMENT APPROVED PAID TO DATE UNPAID* ---- ----------- -------- ------- ---------- ---------- 1. Haynes and Boone 3/20/01 858,001 139,039 858,001 266,977 2. Lain, Faulkner & Co., P.C. 3/20/01 158,386 18,236 158,386 60,181 3. Baker & McKenzie 3/20/01 93,418 0 93,418 0 4. 5. (Attach List) 6. Total Payments To Professionals 1,109,805 157,275 1,109,805 327,158
* Include all fees incurred, both approved and unapproved POST PETITION STATUS OF SECURED NOTES, LEASES PAYABLE AND ADEQUATE PROTECTION PAYMENTS
SCHEDULED AMOUNTS TOTAL MONTHLY PAID UNPAID PAYMENTS DURING POST NAME OF CREDITOR DUE MONTH PETITION ---------------- --------- ------ -------- 1. Bank of America (FOOTNOTE) N/A 0 15,071,491 2. Leases Payable (FOOTNOTE) (Not Available) 3. 4. 5. (Attach List) 6. TOTAL 0 0 15,071,491
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. SUPPLEMENT TO CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS - 6 PAYMENTS TO INSIDERS AND PROFESSIONALS MONTH: JULY-01 ---------------- INSIDERS
TYPE OF AMOUNT TOTAL PAID NAME PAYMENT PAID TO DATE ---- ------- ------ -------- A. Bill Estes Director's Fees 13,000 B. Peter McKee Director's Fees 12,000 C. Richard Nevins Director's Fees 13,000 D. Wingate Partners Management Fee 44,695 89,390 E. Wingate Partners Expense Reimb. 665 3,693 F. G. H. TOTAL OTHER PAYMENTS TO INSIDERS - LINE 5 45,360 131,083
PROFESSIONALS
DATE OF COURT ORDER TOTAL AUTHORIZING AMOUNT AMOUNT TOTAL PAID INCURRED & NAME PAYMENT APPROVED PAID TO DATE UNPAID* ---- ----------- -------- ------- ---------- ---------- A. B. C. D. E. F. G. H. TOTAL OTHER PAYMENTS TO PROFESSIONALS-LINE 5
* Include all fees incurred, both approved and unapproved POST PETITION STATUS OF SECURED NOTES, LEASES PAYABLE AND ADEQUATE PROTECTION PAYMENTS
SCHEDULED AMOUNTS TOTAL MONTHLY PAID UNPAID PAYMENTS DURING POST NAME OF CREDITOR DUE MONTH PETITION ---------------- --------- ------ -------- A. B. C. D. E. STATUS OF OTHER CREDITORS - LINE 5
CASE NAME: KEVCO MANAGEMENT, INC. ACCRUAL BASIS - 7 CASE NUMBER: 401-40788-BJH-11 MONTH: JULY-01 --------------- QUESTIONNAIRE
YES NO --- -- 1. Have any Assets been sold or transferred outside the normal course of business this reporting period? X 2. Have any funds been disbursed from any account other than a debtor in possession account? X 3. Are any Post Petition Receivables (accounts, notes, or loans) due from related parties? X 4. Have any payments been made on Pre Petition Liabilities this reporting period? X 5. Have any Post Petition Loans been received by the debtor from any party? X 6. Are any Post Petition Payroll Taxes past due? X 7. Are any Post Petition State or Federal Income Taxes past due? X 8. Are any Post Petition Real Estate Taxes past due? X 9. Are any other Post Petition Taxes past due? X 10. Are any amounts owed to Post Petition creditors delinquent? X 11. Have any Pre Petition Taxes been paid during the reporting period? X 12. Are any wage payments past due? X
If the answer to any of the above questions is "Yes", provide a detailed explanation of each item. Attach additional sheets if necessary. SEE FOOTNOTE INSURANCE
YES NO --- -- 1. Are Worker's Compensation, General Liability and other necessary insurance coverages in effect? X 2. Are all premium payments paid current? X 3. Please itemize policies below.
If the answer to any of the above questions is "No", or if any policies have been canceled or not renewed during this reporting period, provide an explanation below. Attach additional sheets if necessary. INSTALLMENT PAYMENTS
TYPE OF POLICY CARRIER PERIOD COVERED PAYMENT AMOUNT & FREQUENCY -------------- ------- -------------- -------------------------- Property Lexingon, Allianz 5/29/00-3/1/02 Semi-Annual $26,485 Group Health Blue Cross Blue Shield Terminated 08/01/01 N/A Auto Liberty Mutual 9/1/00-3/1/02 Semi-Annual $ 3,333 D&O Liability Great American Insurance 10/31/98-10/31/01 Annual $64,657
This form x does does not have related footnotes on Footnotes Supplement. --- --- CASE NAME: KEVCO MANAGEMENT, INC. FOOTNOTES SUPPLEMENT CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS MONTH: JULY-01 -----------------
ACCRUAL BASIS FORM NUMBER LINE NUMBER FOOTNOTE/EXPLANATION ------ ----------- -------------------- 1 1 Pursuant to the February 12, 2001 Order (1) Authorizing Continued Use of Existing Forms 3 1 and Records; (2) Authorizing Maintenance of Existing Corporate Bank Accounts and Cash Management System; and (3) Extending Time to Comply with 11 U.S.C. Section 345 Investment Guidelines, funds in the Bank of America and Key Bank deposit accounts are swept daily into Kevco's lead account number 1295026976. The Bank of America lead account is administered by, and held in the name of Kevco Management Co. Accordingly, all cash receipts and disbursements flow through Kevco Management's Bank of America DIP account. A schedule allocating receipts and disbursements among Kevco, Inc. and its subsidiaries is included in this report as a Supplement to Accrual Basis -3. 1 7 Prepaid Expenses consist primarily of professional fee retainers. 1 10 During July, expense accruals made at the beginning of the year were reversed because the 1 14A liabilities will not be incurred as estimated. In addition, all property, plant, equipment, 2 17A fixed and other assets were written off. These balance sheet and income statement adjustments were made in order to more accurately reflect Debtor's assets, liabilities and expenses. The income statement gains and losses were netted and classified as Balance Sheet adjustments. 1 10 Pursuant to Asset Purchase Agreements approved by the Court (see prior Monthly Operating 1 24 Reports for details), the Kevco Debtors have sold most of their assets except for 6 1 certain items of real property currently being marketed. 1 15 Intercompany receivables/payables are from/to co-debtors Kevco Manufacturing, LP (Case 1 27A No. 401-40784-BJH-11), Kevco Distribution, LP (Case No. 401-40789-BJH-11), Kevco 7 3 Holding, Inc. (Case No. 401-40785-BJH-11), DCM Delaware, Inc. (Case No. 401-40787-BJH-11), Kevco GP, Inc. (Case No. 401-40786-BJH-11), Kevco Components, Inc. (Case No. 401-40790-BJH-11), and Kevco, Inc. (Case No. 401-40783-BJH-11). Changes in intercompany have not been reflected as post-petition assets and liabilities. 1 22 The Debtor records on its books accruals for certain liabilities based on historical estimates. While the known creditors were listed on the Debtor's Schedules, the estimated amounts were not. Accordingly, for purposes of this report, the accrued liabilities are reflected as post-petition "Accrued Liabilities."
CASE NAME: KEVCO MANAGEMENT, INC. FOOTNOTES SUPPLEMENT CASE NUMBER: 401-40788-BJH-11 ACCRUAL BASIS MONTH: JULY-01 -----------------
ACCRUAL BASIS FORM NUMBER LINE NUMBER FOOTNOTE/EXPLANATION ------ ----------- -------------------- 1 25 Pursuant to Order dated February 12, 2001 and Supplemental Order dated March 14, 2001, 2 9, 13A debtors were authorized to pay pre-petition salaries and wages up to a maximum of $4,300 5 Supp. per employee. Debtors were also (a) allowed to pay accrued vacation to terminated employees and (b) permitted to continue allowing employees to use vacation time as scheduled. During July, all Debtor's employees except two, Sharon Romere and Wil Simpson, were terminated. In accordance with a March 14, 2001 Order Granting Motion to Approve Management and Employee Retention Plan by Kevco, Inc., stay bonuses were paid to participating employees from Debtors' DIP operating account. Funds maintained in the Bank of America "Stay Pay" account will be transferred in August to the operating account as reimbursement. 1 32 Adjustments to equity are due to secured debt reductions pursuant to the sales of Kevco Manufacturing, LP's operating divisions, the asset sale of the South Region of Kevco Distribution, as well as direct cash payments (see footnote 1,24). The secured debt owed to Bank of America by Kevco, Inc. (Case No. 401-40783-BJH-11) has been guaranteed by all of its co-debtors (see Footnote 1,27A); therefore, the secured debt is reflected as a liability on all of the Kevco entities. The charge to equity is simply an adjustment to the balance sheet. 4 9,12 Sales/property tax liabilities represent accruals of tax and are not yet due. 6 2 The Debtor is the lessee on hundreds of real and personal property leases, the vast majority of which have been rejected. The Debtor does not isolate monthly payments due or paid on account of such leases. Instead, all lease payments are reflected in the Debtor's accounts payable system. To separately identify monthly accruals and payments on leases would require an enormous outlay of the Debtor's accounting personnel and professionals. The Debtor simply does not have available to it the resources that would be required to provide the detail requested. If any party-in-interest desires specific information about any specific lease, the Debtor will provide such information upon request.