UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 31, 2016
RCS Capital Corporation
(Exact name of registrant as specified in its charter)
Delaware | 001-35924 | 38-3894716 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
245 Park Ave., 39th Floor | ||||
New York, NY | 10167 | |||
(Address of principal executive offices) | (Zip Code) |
(212) 672 -1602
(Registrants telephone number, including area code)
405 Park Ave., 12th Floor
New York, NY 10022
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 7.01. | Regulation FD Disclosure. |
As previously disclosed on a Current Report on Form 8-K filed with the Securities and Exchange Commission (SEC) on February 1, 2016, on January 31, 2016, RCS Capital Corporation (the Company) and certain of its wholly-owned subsidiaries (collectively with the Company, the First Wave Debtors) filed voluntary petitions for reorganization in the United States Bankruptcy Court for the District of Delaware (the Court) seeking relief under Chapter 11 of Title 11 of the United States Code (the Bankruptcy Code). The Companys Chapter 11 cases are being jointly administered for procedural purposes only under the caption In re RCS Capital Corporation, et al., Case No. 16-10223(MFW) (together, the Chapter 11 Cases). In addition, certain of the Companys other subsidiaries (collectively with the First Wave Debtors, the Debtors) filed voluntary petitions for reorganization in the Court in a subsequent pre-pack Chapter 11 bankruptcy filing on March 26, 2016. The Debtors will continue to operate their businesses as debtors-in-possession under the jurisdiction of the Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Court.
On March 31, 2016, the First Wave Debtors filed their monthly operating report for the month ended February 29, 2016 (the Monthly Operating Report) with the Court. The Monthly Operating Report is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information furnished under this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of that Section. The information in this Item 7.01, including Exhibit 99.1, shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing.
Cautionary Statement Regarding Monthly Operating Report
The Company cautions investors and potential investors not to place undue reliance upon the information contained in the Monthly Operating Report, which was not prepared for the purpose of providing the basis for an investment decision relating to any of the securities of the Company. The Monthly Operating Report is limited in scope, covers a limited time period and has been prepared solely for the purpose of complying with the monthly reporting requirements applicable in the Chapter 11 Cases and is in a format acceptable to the U.S. Trustee. The Company is not required to publicly update the Monthly Operating Report to reflect more current facts or estimates or the occurrence of future events, including if the facts, estimates and assumptions upon which the Monthly Operating Report is based are erroneous. The Monthly Operating Report was not audited or reviewed by independent accountants, was not prepared in accordance with generally accepted accounting principles in the United States, is in a format prescribed by applicable bankruptcy laws, and is subject to future adjustment (which may be material) and reconciliation. There can be no assurance that, from the perspective of an investor or potential investor in the Companys securities, the Monthly Operating Report is complete. The Monthly Operating Report also contains information for periods which are shorter or otherwise different from those required in the Companys reports pursuant to the Exchange Act and such information might not be indicative of the Companys financial condition or operating results for the period that would be reflected in the Companys financial statements or in its reports pursuant to the Exchange Act. Results set forth in the Monthly Operating Report should not be viewed as indicative of future results.
The Company also cautions that trading in its securities during the pendency of the Chapter 11 Cases is highly speculative and poses substantial risks. The Joint Plan of Reorganization (the Plan) currently proposed by the Company in the Chapter 11 Cases is presently supported by creditors holding 92.5% in principal amount and substantially in excess of a majority in number of the Companys first lien secured debt, 87.6% in principal amount and substantially in excess of a majority in number of the second lien secured debt and a majority in dollar amount of the Companys unsecured debt. If the Plan is consummated, the Companys Class A common stock will be extinguished and the holders of the Class A common stock will not receive any consideration.
Forward-Looking Statements
Information set forth in this Current Report on Form 8-K contains forward-looking statements (as defined in Section 21E of the Exchange Act), which reflect the Companys expectations regarding future events. The forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements include, but are not limited to, the Companys ability to consummate the Plan. Additional factors that may affect future results are contained in the Companys filings with the SEC, which are available at the SECs website at www.sec.gov. The Company disclaims any obligation to update and revise statements contained in these materials based on new information or otherwise.
Item 9.01. | Financial Statements and Exhibits. |
(d) | Exhibits |
Exhibit No. |
Exhibit Description | |
99.1 | Monthly Operating Report for the month ended February 29, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
RCS Capital Corporation | ||||||
Date: April 4, 2016 | By: | /s/ Bradley E. Scher | ||||
Name: | Bradley E. Scher | |||||
Title: | Chief Executive Officer |
Exhibit 99.1
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re RCS Capital Corporation, et al. | Case No. 16-10223 (MFW) | |||
Debtors | Reporting Period: 2/1/16 - 2/29/16 |
MONTHLY OPERATING REPORT
File with Court and submit copy to United States Trustee within 20 days after end of month.
Submit copy of report to any official committee appointed in the case.
REQUIRED DOCUMENTS |
Form No. | Document Attached |
Explanation Attached |
Affidavit/Supplement Attached | ||||||
Schedule of Cash Receipts and Disbursements |
MOR-1 | X | ||||||||
Bank Reconciliation (or copies of debtors bank reconciliations) |
MOR-1a | X | ||||||||
Schedule of Professional Fees Paid |
MOR-1b | X | ||||||||
Copies of bank statements |
||||||||||
Cash disbursements journals |
||||||||||
Statement of Operations |
MOR-2 | X | ||||||||
Balance Sheet |
MOR-3 | X | ||||||||
Status of Postpetition Taxes |
MOR-4 | X | ||||||||
Copies of IRS Form 6123 or payment receipt |
||||||||||
Copies of tax returns filed during reporting period |
||||||||||
Summary of Unpaid Postpetition Debts |
MOR-4 | X | ||||||||
Listing of aged accounts payable |
MOR-4 | X | ||||||||
Accounts Receivable Reconciliation and Aging |
MOR-5 | X | ||||||||
Debtor Questionnaire |
MOR-5 | X |
I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the attached documents are true and correct to the best of my knowledge and belief.
/s/ David Orlofsky | 3/31/16 | |||||
Signature of Authorized Individual* | Date | |||||
David Orlofsky | Chief Restructuring Officer | |||||
Printed Name of Authorized Individual | Title of Authorized Individual |
* | Authorized individual must be an officer, director or shareholder if debtor is a corporation; a partner if debtor is a partnership; a manager or member if debtor is a limited liability company. |
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |
Listing of Debtor Entities and Notes to the Monthly Operating Report |
General:
The report includes activity from the following Debtors and related case numbers:
Debtor |
Case Number | |||
RCS Capital Corporation |
16-10223 | |||
American National Stock Transfer, LLC |
16-10224 | |||
Braces Acquisition, LLC |
16-10225 | |||
Directvest, LLC |
16-10226 | |||
J.P. Turner & Company Capital Management, LLC |
16-10227 | |||
RCS Advisory Services, LLC |
16-10228 | |||
RCS Capital Holdings, LLC |
16-10229 | |||
Realty Capital Securities, LLC |
16-10230 | |||
SBSI Insurance Agency of Texas, INC. |
16-10231 | |||
SK Research, LLC |
16-10232 | |||
Trupoly, LLC |
16-10233 | |||
We R Crowdfunding, LLC |
16-10234 |
Notes to the MOR:
This Monthly Operating Report (MOR) has been prepared solely for the purpose of complying with the monthly reporting requirements applicable in the bankruptcy cases. The financial information contained herein is unaudited, limited in scope and as discussed below, not prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
The results of operations contained herein are not necessarily indicative of results which may be expected from any other period or for the full year and may not necessarily reflect the consolidated results of operations, financial position and schedule of receipts and disbursements in the future. The Debtors caution readers not to place undue reliance upon the MOR. There can be no assurance that such information is complete and the MOR may be subject to revision.
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-1A Schedule of Cash Receipts and Disbursements (February 1 - February 29, 2016) | ||||
Budget Variance Report, for the month ending 02/29 |
($ in 000s) |
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Projected Month |
Actual Month |
Variance Month |
Projected Cumulative |
Actual Cumulative |
Variance Cumulative |
|||||||||||||||||||
OPERATING ACTIVITY |
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Operating inflows: |
||||||||||||||||||||||||
RCS Advisory Services receipts |
$ | 250 | $ | 10 | $ | (240 | ) | $ | 250 | $ | 10 | $ | (240 | ) | ||||||||||
Hatterasoverhead allocation |
| | | | | | ||||||||||||||||||
Ceterashared service interco |
2,300 | 528 | (1,772 | ) | 2,300 | 528 | (1,772 | ) | ||||||||||||||||
Ceteradividends |
| 950 | 950 | | 950 | 950 | ||||||||||||||||||
Other |
| 443 | 443 | | 443 | 443 | ||||||||||||||||||
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Total Operating inflows |
2,550 | 1,932 | (618 | ) | 2,550 | 1,932 | (618 | ) | ||||||||||||||||
Operating outflows: |
||||||||||||||||||||||||
Trade payables |
(1,462 | ) | (422 | ) | 1,039 | (1,462 | ) | (422 | ) | 1,039 | ||||||||||||||
InsuranceD&O/E&O policies |
(309 | ) | (322 | ) | (13 | ) | (309 | ) | (322 | ) | (13 | ) | ||||||||||||
Payroll & taxes |
(1,057 | ) | (449 | ) | 608 | (1,057 | ) | (449 | ) | 608 | ||||||||||||||
Rent & occupancy costs |
(339 | ) | | 339 | (339 | ) | | 339 | ||||||||||||||||
RCS B/D contribution |
| (950 | ) | (950 | ) | | (950 | ) | (950 | ) | ||||||||||||||
Docupace capital contribution |
(1,000 | ) | | 1,000 | (1,000 | ) | | 1,000 | ||||||||||||||||
Other |
(87 | ) | 7 | 94 | (87 | ) | 7 | 94 | ||||||||||||||||
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Total Operating outflows |
(4,254 | ) | (2,136 | ) | 2,118 | (4,254 | ) | (2,136 | ) | 2,118 | ||||||||||||||
Total Operating Cash Flow |
$ | (1,704 | ) | $ | (204 | ) | $ | 1,500 | $ | (1,704 | ) | $ | (204 | ) | $ | 1,500 | ||||||||
NON-OPERATING ACTIVITY |
||||||||||||||||||||||||
Severance payments |
(67 | ) | | 67 | (67 | ) | | 67 | ||||||||||||||||
RCAP retention/bonus payments |
| | | | | | ||||||||||||||||||
ICH/VSR/Girardhold back/retention pmts. |
(1,200 | ) | | 1,200 | (1,200 | ) | | 1,200 | ||||||||||||||||
ARCP note amortization |
| | | | | | ||||||||||||||||||
Tax refund receipts |
1,600 | | (1,600 | ) | 1,600 | | (1,600 | ) | ||||||||||||||||
Hatteras sale proceeds |
| | | | | | ||||||||||||||||||
Strat Cap sale proceeds |
| | | | | | ||||||||||||||||||
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Net non-operating inflows/(outflows) |
333 | | (333 | ) | 333 | | (333 | ) | ||||||||||||||||
RESTRUCTURING EXPENDITURES |
||||||||||||||||||||||||
Restructuring professional fees |
(250 | ) | (151 | ) | 99 | (250 | ) | (151 | ) | 99 | ||||||||||||||
First-day order payments |
| | | | | | ||||||||||||||||||
DIP financing fees |
(1,424 | ) | | 1,424 | (1,424 | ) | | 1,424 | ||||||||||||||||
DIP interest |
| (115 | ) | (115 | ) | | (115 | ) | (115 | ) | ||||||||||||||
Advisor retention loans |
| | | | | | ||||||||||||||||||
BD capital contribution |
(15,000 | ) | (9,063 | ) | 5,937 | (15,000 | ) | (9,063 | ) | 5,937 | ||||||||||||||
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Total restructuring expenditures |
(16,674 | ) | (9,329 | ) | 7,345 | (16,674 | ) | (9,329 | ) | 7,345 | ||||||||||||||
Net Cash Flow |
$ | (18,045 | ) | $ | (9,533 | ) | $ | 8,512 | $ | (18,045 | ) | $ | (9,533 | ) | $ | 8,512 | ||||||||
LIQUIDITY |
||||||||||||||||||||||||
Beginning Book Cash |
7,872 | 8,105 | 233 | 7,872 | 8,105 | 233 | ||||||||||||||||||
Net cash flow |
(18,045 | ) | (9,533 | ) | 8,512 | (18,045 | ) | (9,533 | ) | 8,512 | ||||||||||||||
DIP Draw |
100,000 | 23,278 | (76,722 | ) | 100,000 | 23,278 | (76,722 | ) | ||||||||||||||||
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Ending Book Cash |
$ | 89,827 | $ | 21,850 | $ | (67,977 | ) | $ | 89,827 | $ | 21,850 | $ | (67,977 | ) | ||||||||||
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RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-1B Cash Disbursements Allocated by Entity (February 1 - February 29, 2016) |
($ in 000s) |
||||||||||||||||||||||||||||||||||||||||||||||||||||
RCS Capital Corp. |
ANST | Braves Acquisition |
DirectVest | JPT | RCS Adv. Serv. |
RCS Capital Hold. |
Realty Capital Sec. |
SBSI | SK Research |
Trupoly | WeR Crowdfunding |
Total | ||||||||||||||||||||||||||||||||||||||||
DISBURSEMENTS |
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Operating outflows: |
||||||||||||||||||||||||||||||||||||||||||||||||||||
Trade payables |
(422 | ) | | | | | | | | | | | | (422 | ) | |||||||||||||||||||||||||||||||||||||
InsuranceD&O/E&O policies |
(322 | ) | | | | | | | | | | | | (322 | ) | |||||||||||||||||||||||||||||||||||||
Payroll & taxes |
(379 | ) | (40 | ) | | | | (28 | ) | | | | (2 | ) | | | (449 | ) | ||||||||||||||||||||||||||||||||||
Rent & occupancy costs |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
RCS B/D contribution |
(950 | ) | | | | | | | | | | | | (950 | ) | |||||||||||||||||||||||||||||||||||||
Docupace capital contribution |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
Other |
5 | | | | | | | | | 3 | | | 7 | |||||||||||||||||||||||||||||||||||||||
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Total Operating outflows |
(2,069 | ) | (40 | ) | | | | (28 | ) | | | | 1 | | | (2,136 | ) | |||||||||||||||||||||||||||||||||||
NON-OPERATING ACTIVITY |
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Severance payments |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
RCAP retention/bonus payments |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
ICH/VSR/Girardhold back/retention pmts. |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
ARCP note amortization |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
Hatteras sale proceeds |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
Strat Cap sale proceeds |
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Net non-operating inflows/(outflows) |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
RESTRUCTURING EXPENDITURES |
||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring professional fees |
(151 | ) | | | | | | | | | | | | (151 | ) | |||||||||||||||||||||||||||||||||||||
First-day order payments |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
DIP financing fees |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
DIP interest |
(115 | ) | | | | | | | | | | | | (115 | ) | |||||||||||||||||||||||||||||||||||||
Advisor retention loans |
| | | | | | | | | | | | | |||||||||||||||||||||||||||||||||||||||
BD capital contribution |
(9,063 | ) | | | | | | | | | | | | (9,063 | ) | |||||||||||||||||||||||||||||||||||||
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Total restructuring expenditures |
(9,329 | ) | | (9,329 | ) | |||||||||||||||||||||||||||||||||||||||||||||||
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Total Disbursements |
$ | (11,398 | ) | $ | (40 | ) | No Disb. | No Disb. | No Disb. | $ | (28 | ) | No Disb. | No Disb. | No Disb. | $ | 1 | No Disb. | No Disb. | $ | (11,465 | ) | ||||||||||||||||||||||||||||||
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DISBURSEMENTS FOR CALCULATING U.S. TRUSTEE QUARTERLY FEES: (FROM CURRENT MONTH ACTUAL COLUMN) |
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Total Disbursements |
$ | 11,465 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Less: Transfers to Debtor in Possession Accounts |
|
10,013 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Plus: Estate Disbursements made by Outside Sources (i.e. from escrow accounts) |
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Total Disbursements for Calculating U.S. Trustee Quarterly Fees |
|
$ | 1,452 | |||||||||||||||||||||||||||||||||||||||||||||||||
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RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-1B Schedule of Professional Fees and Expenses Paid (February 1 - February 29, 2016) |
($ in 000s) |
||||||||||||||||||
Period | Amount | Check | Amount Paid | Year-to-Date | ||||||||||||||
Payee |
Covered | Approved | Payor | Number | Date | Fees | Expenses | Fees | Expenses |
No professionals paid from 2/1/16 through 2/29/16
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-2 Bank Account Reconciliation as of February 29, 2016 |
Account | Beginning Balance | Ending Balance | ||||||||||||||||
Debtor Name |
Bank | Number | Account Description |
2/1/2016 | 2/29/2016 | |||||||||||||
Primary Bank Accounts |
||||||||||||||||||
RCS Capital Corporation |
Bank of America | #### | Operating accountSmall business checking | 1,197,893 | 19,636,271 | |||||||||||||
RCS Capital Corporation |
Bank of America | #### | Payroll accountBusiness checking | 133,704 | 680,268 | |||||||||||||
RCS Capital Holdings |
Bank of America | #### | Operating accountBusiness interest checking | 4,918,500 | 1,564 | |||||||||||||
RCS Advisory Services |
Bank of America | #### | Operating accountSmall business checking | 1,756 | 24,951 | |||||||||||||
RCS Advisory Services |
Bank of America | #### | Payroll accountSmall business checking | 77,960 | 1,000 | |||||||||||||
ANST |
Bank of America | #### | Operating accountSmall business checking | 1,544,169 | 1,500,713 | |||||||||||||
ANST |
Bank of America | #### | Payroll accountSmall business checking | 4,594 | 954 | |||||||||||||
SK Research |
Bank of America | #### | Operating accountSmall business checking | 222,055 | 1,000 | |||||||||||||
SK Research |
Bank of America | #### | Payroll accountBusiness interest checking | 18,442 | 1,002 | |||||||||||||
SK Research |
Bank of America | #### | BDC deposit accountSmall business checking | 937 | 1,000 | |||||||||||||
Trupoly |
Bank of America | #### | Operating accountBusiness checking | 1,339 | 1,000 | |||||||||||||
Secondary Bank Accounts |
||||||||||||||||||
Realty Capital Securities |
Bank of America | #### | Operating accountChecking | 1,122,330 | 1,020,023 | |||||||||||||
Realty Capital Securities |
Bank of America | #### | Payroll accountChecking | 142,040 | 613 | |||||||||||||
Realty Capital Securities |
Bank of America | #### | Commissions accountChecking | | (0 | ) | ||||||||||||
Realty Capital Securities |
Bank of America | #### | Reserve accountChecking | | 1,000 | |||||||||||||
J.P. Turner Capital |
Bank of America | #### | Operating accountChecking | | |
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-3 Consolidating Income Statement as of February 29, 2016 |
($ in 000s) |
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RCS Capital Corp |
RCS Capital Holdings |
Realty Capital Securities |
RCS Advisory Services, LLC |
American National Stock Transfer, LLC |
SK Research, LLC |
J.P. Turner & Company, LLC |
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Revenue: |
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Selling commissionsNon-related |
149 | |||||||||||||||||||||||||||
Dealer manager feesNon-related |
37 | |||||||||||||||||||||||||||
Retail commissions |
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Advisory and asset-based fees |
6 | |||||||||||||||||||||||||||
Transfer agency revenue |
1,181 | |||||||||||||||||||||||||||
Services revenueNon-related |
25 | 13 | ||||||||||||||||||||||||||
Technology Fees Revenue |
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Transaction Fees |
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Other Revenue |
11 | 1 | (35 | ) | 0 | |||||||||||||||||||||||
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|||||||||||||||
Total revenues |
11 | 1 | 151 | 25 | 1,194 | 0 | 6 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Expenses: |
||||||||||||||||||||||||||||
Wholesale commissionsRelated |
||||||||||||||||||||||||||||
Wholesale commissionsNon-related |
151 | |||||||||||||||||||||||||||
Wholesale reallowanceRelated |
||||||||||||||||||||||||||||
Wholesale reallowanceNon-related |
8 | |||||||||||||||||||||||||||
Retail commission and advisory |
22 | |||||||||||||||||||||||||||
Technology Service Fee Cost of Revenue |
||||||||||||||||||||||||||||
Internal commissions |
22 | |||||||||||||||||||||||||||
Payroll and benefits |
415 | (0 | ) | 17,707 | 77 | (221 | ) | 2,622 | ||||||||||||||||||||
Conferences and seminars |
1 | (55 | ) | |||||||||||||||||||||||||
Travel |
28 | 17 | (4 | ) | 1 | (0 | ) | |||||||||||||||||||||
Marketing and advertising |
0 | (0 | ) | 3 | ||||||||||||||||||||||||
Professional fees |
5,674 | 0 | (15 | ) | 21 | 3 | 8 | |||||||||||||||||||||
Data processing |
16 | 208 | 42 | 602 | 6 | |||||||||||||||||||||||
Acquisition-related costs |
1 | (74 | ) | |||||||||||||||||||||||||
Interest expense |
16,221 | |||||||||||||||||||||||||||
Occupancy |
535 | (72 | ) | 16 | 6 | (54 | ) | |||||||||||||||||||||
Depreciation and amortization expense |
0 | 9 | 1 | |||||||||||||||||||||||||
Clearing and exchange fees |
||||||||||||||||||||||||||||
Other expenses |
(753 | ) | 359 | 89 | 48 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total Expenses |
22,138 | (74 | ) | 18,338 | 156 | 482 | 2,629 | 22 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Income (loss) before taxes |
(22,127 | ) | 75 | (18,186 | ) | (131 | ) | 712 | (2,629 | ) | (16 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Provision (benefit) for income taxes |
2 | 52 | ||||||||||||||||||||||||||
Net income (loss) from continuing operations |
(22,127 | ) | 75 | (18,188 | ) | (183 | ) | 712 | (2,629 | ) | (16 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Less: Net income (loss) attributable to non-controlling interests |
||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net income (loss) attributable to RCS Capital Corporation |
(22,127 | ) | 21,409 | (18,188 | ) | (183 | ) | 712 | (2,629 | ) | (16 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-3 Consolidating Balance Sheet as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||||||||||
RCS Capital Corp |
RCS Capital Holdings |
Realty Capital Securities |
RCS Advisory Services, LLC |
American National Stock Transfer, LLC |
SK Research, LLC |
J.P. Turner & Company, LLC |
Trupoly | |||||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||||
Cash and cash equivalents |
20,318 | 2 | 1,022 | 26 | 1,502 | 3 | 534 | (0 | ) | |||||||||||||||||||||||
Cash and securities segregated under federal and other regulations |
||||||||||||||||||||||||||||||||
Available-for-sale-securities |
2,771 | |||||||||||||||||||||||||||||||
Trading securities |
||||||||||||||||||||||||||||||||
Fees and commissions receivable |
||||||||||||||||||||||||||||||||
Reimbursable expenses receivable |
669 | 3,755 | 5,667 | 608 | ||||||||||||||||||||||||||||
Receivable from customers |
||||||||||||||||||||||||||||||||
Allowance for doubtful accounts |
(91 | ) | (823 | ) | ||||||||||||||||||||||||||||
Receivables from broker, dealers, clearing organizations and other |
551 | 286 | (32 | ) | 37 | 465 | ||||||||||||||||||||||||||
Prepaid expenses |
7,366 | 381 | 0 | 2 | 9 | |||||||||||||||||||||||||||
Property and equipment, net |
33 | 541 | ||||||||||||||||||||||||||||||
Deferred compensation plan investments |
||||||||||||||||||||||||||||||||
Notes receivable, net |
1,500 | 1,500 | ||||||||||||||||||||||||||||||
Deferred financing fees |
33,149 | |||||||||||||||||||||||||||||||
Intangible assets, net |
||||||||||||||||||||||||||||||||
Goodwill |
||||||||||||||||||||||||||||||||
Other assets |
13,944 | 101 | ||||||||||||||||||||||||||||||
Deferred income tax asset, net |
29,408 | |||||||||||||||||||||||||||||||
Investment in subsidiaries, at fair value |
1,108,081 | 1,569,597 | 1,031 | |||||||||||||||||||||||||||||
Intercompany Accounts Receivables |
37,378 | 2,508 | 6 | 11,975 | 2,081 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
TOTAL ASSETS |
1,254,500 | 1,572,106 | 2,465 | 15,633 | 8,466 | 1,626 | 3,065 | (0 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-3 Consolidating Balance Sheet as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||||||||||
RCS Capital Corp |
RCS Capital Holdings |
Realty Capital Securities |
RCS Advisory Services, LLC |
American National Stock Transfer, LLC |
SK Research, LLC |
J.P. Turner & Company, LLC |
Trupoly | |||||||||||||||||||||||||
Liabilities, Mezzanine Equity and Stockholders Equity |
||||||||||||||||||||||||||||||||
Payable to customers |
||||||||||||||||||||||||||||||||
Payable to broker-dealers |
0 | |||||||||||||||||||||||||||||||
Commissions payable |
||||||||||||||||||||||||||||||||
Accrued expenses and accounts payable |
47,022 | 35,355 | 8,149 | 1,987 | 2,807 | 1,294 | ||||||||||||||||||||||||||
Deferred revenue |
250 | 450 | 13 | |||||||||||||||||||||||||||||
Derivative contracts |
781 | |||||||||||||||||||||||||||||||
Other liabilities |
5,171 | |||||||||||||||||||||||||||||||
Deferred compensation plan accrued liabilities |
||||||||||||||||||||||||||||||||
Net deferred tax liability |
(100,548 | ) | ||||||||||||||||||||||||||||||
Contingent and deferred consideration |
18,122 | |||||||||||||||||||||||||||||||
Long-term debt |
826,833 | 1,500 | ||||||||||||||||||||||||||||||
Due from RCAP Holdings and other related parties |
(27,639 | ) | 27,639 | 101,430 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total liabilities |
751,620 | 81,116 | 109,829 | 1,987 | 3,257 | 1,306 | 1,500 | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Preferred Stock-Series B-Cost Value |
146,700 | |||||||||||||||||||||||||||||||
Preferred Stock-Series C-Cost Value |
111,288 | |||||||||||||||||||||||||||||||
Preferred Series B-Dividends PIK |
20,442 | |||||||||||||||||||||||||||||||
Preferred Series C-Dividends PIK |
9,826 | |||||||||||||||||||||||||||||||
Preferred Stock Series D-1 Value |
25,000 | |||||||||||||||||||||||||||||||
Preferred Stock Series D-2 Value |
12,500 | |||||||||||||||||||||||||||||||
Preferred Stock Series D-1- Dividends PIK |
1,156 | |||||||||||||||||||||||||||||||
Preferred Stock Series D-2- Dividends PIK |
578 | |||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
Mezzanine equity |
327,488 | |||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
Class A common stock |
65,645 | 2 | ||||||||||||||||||||||||||||||
Additional paid-in capital |
580,029 | 1,251,590 | 53,008 | 9,811 | 695 | 7,501 | (2,493 | ) | ||||||||||||||||||||||||
Accumulated other comprehensive income (loss) |
68 | 0 | ||||||||||||||||||||||||||||||
Retained earnings |
(470,351 | ) | 239,399 | (160,372 | ) | 3,834 | 4,514 | (7,182 | ) | 4,058 | (0 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total stockholders equity |
175,392 | 1,490,990 | (107,364 | ) | 13,646 | 5,209 | 319 | 1,565 | (0 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Non-controlling interest |
0 | |||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
TOTAL LIABILITIES AND EQUITY |
1,254,500 | 1,572,106 | 2,465 | 15,633 | 8,466 | 1,626 | 3,065 | (0 | ) | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-3 Intercompany Payables/Receivables as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||||||||||||||
Receivable from |
RCS Capital Corp |
RCS Capital Holdings |
Realty Capital Securities |
RCS Advisory Services, LLC |
American National Stock Transfer, LLC |
SK Research, LLC |
Trupoly | WeR Crowdfunding |
J.P. Turner & Company, LLC |
|||||||||||||||||||||||||||
Realty Capital Securities |
2,171 | 215 | ||||||||||||||||||||||||||||||||||
RCS Advisory |
687 | |||||||||||||||||||||||||||||||||||
ANST |
6 | |||||||||||||||||||||||||||||||||||
RCSCC |
10,015 | 1,389 | ||||||||||||||||||||||||||||||||||
RCS Capital Holdings |
30,987 | 1,424 | 5 | |||||||||||||||||||||||||||||||||
SK Research |
619 | 269 | ||||||||||||||||||||||||||||||||||
RCS IB |
51 | |||||||||||||||||||||||||||||||||||
Trupoly |
||||||||||||||||||||||||||||||||||||
WeRCrowdfunding |
0 | |||||||||||||||||||||||||||||||||||
Cetera |
1,751 | |||||||||||||||||||||||||||||||||||
JP Turner |
(38 | ) | ||||||||||||||||||||||||||||||||||
First Allied |
1,333 | |||||||||||||||||||||||||||||||||||
Legends |
63 | |||||||||||||||||||||||||||||||||||
Hatteras |
||||||||||||||||||||||||||||||||||||
Summit |
51 | 2,508 | ||||||||||||||||||||||||||||||||||
ICH |
49 | |||||||||||||||||||||||||||||||||||
Strategic Capital |
||||||||||||||||||||||||||||||||||||
VSR |
59 | |||||||||||||||||||||||||||||||||||
Girard |
17 | |||||||||||||||||||||||||||||||||||
Docupace |
315 | |||||||||||||||||||||||||||||||||||
Total |
37,378 | 2,508 | 6 | 11,975 | 2,081 | | | | |
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-3 Intercompany Payables/Receivables as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||||||||||||||
RCS | RCS | Realty | RCS | American | J.P. | |||||||||||||||||||||||||||||||
Capital | Capital | Capital | Advisory | National Stock | SK | WeR | Turner & | |||||||||||||||||||||||||||||
Payable to |
Corp | Holdings | Securities | Services, LLC | Transfer, LLC | Research, LLC | Trupoly | Crowdfunding | Company, LLC | |||||||||||||||||||||||||||
Realty Capital Securities |
6 | |||||||||||||||||||||||||||||||||||
RCS Advisory |
10,015 | 1,424 | 215 | 269 | ||||||||||||||||||||||||||||||||
ANST |
1,389 | 5 | 687 | |||||||||||||||||||||||||||||||||
RCSCC |
30,987 | 2,171 | 619 | 0 | (38 | ) | ||||||||||||||||||||||||||||||
RCS Capital Holdings |
||||||||||||||||||||||||||||||||||||
SK Research |
||||||||||||||||||||||||||||||||||||
RCS IB |
4,157 | 131 | 119 | |||||||||||||||||||||||||||||||||
Trupoly |
||||||||||||||||||||||||||||||||||||
WeRCrowdfunding |
||||||||||||||||||||||||||||||||||||
Cetera |
601 | |||||||||||||||||||||||||||||||||||
JP Turner |
||||||||||||||||||||||||||||||||||||
First Allied |
||||||||||||||||||||||||||||||||||||
Legends |
||||||||||||||||||||||||||||||||||||
Hatteras |
||||||||||||||||||||||||||||||||||||
Summit |
1 | 17 | ||||||||||||||||||||||||||||||||||
ICH |
30 | |||||||||||||||||||||||||||||||||||
Strategic Capital |
||||||||||||||||||||||||||||||||||||
VSR |
||||||||||||||||||||||||||||||||||||
Girard |
||||||||||||||||||||||||||||||||||||
Docupace |
||||||||||||||||||||||||||||||||||||
Total |
15,591 | 32,548 | 2,505 | 687 | 6 | 889 | | 0 | 580 |
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-4 Statement of Accounts Payable Aging as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||
0 - 30 | 31 - 60 | 61 - 90 | 91 -120 | Over 120 | Total | |||||||||||||||||||
Debtor Name |
Days | Days | Days | Days | Days | Payables | ||||||||||||||||||
RCS Capital Corp. |
271,360 | | | | | 271,360 | ||||||||||||||||||
ANST |
180 | | | | | 180 | ||||||||||||||||||
RCS Advisory Services |
148 | | | | | 148 | ||||||||||||||||||
Realty Capital Securities |
64,042 | | | | | 64,042 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total |
335,730 | | | | 335,730 |
RCS Capital Corporation, et al., | Case No. 16-10223 (MFW) | |||
MOR-5 Statement of Accounts Receivable Aging as of February 29, 2016 |
($ in 000s) |
||||||||||||||||||||||||||||
0 - 30 | 31 - 60 | 61 - 90 | Over 90 | Total | Allowance for | Net | ||||||||||||||||||||||
Debtor Name |
Days | Days | Days | Days | Receivables | Doubtful Acts. | Receivables (1) | |||||||||||||||||||||
ANST |
| 1,292,517 | 1,456,041 | 1,557,388 | 4,305,946 | (823,215 | ) | 3,482,732 | ||||||||||||||||||||
RCS Advisory Services |
| 82,681 | 739,575 | 3,844,427 | 4,666,683 | (1,010,579 | ) | 3,656,104 | ||||||||||||||||||||
Realty Capital Securities |
| 57,080 | 117,310 | 501,931 | 676,322 | | 676,322 | |||||||||||||||||||||
SK Research |
| 608,846 | (246,769 | ) | 927,548 | 1,289,625 | | 1,289,625 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total |
| 2,041,124 | 2,066,158 | 6,831,294 | 10,938,576 | (1,833,794 | ) | 9,104,783 |
(1) | The majority of A/R is related to ARC and should be considered contingent |
Debtor Questionnaire
Yes | No | |||
1. Have any assets been sold or transferred outside the normal course of business this reporting period? If yes, provide an explanation below. |
X | |||
2. Have any funds been disbursed from any account other than a debtor in possession account this reporting period? If yes, provide an explanation below. |
X | |||
3. Have all postpetition tax returns been timely filed? If no, provide an explanation below. |
X | |||
4. Are workers compensation, general liability and other necessary insurance coverages in effect? If no, provide an explanation below. |
X | |||
5. Has any bank account been opened during the reporting period? If yes, provide documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3. |
X |
In re RCS Capital Corp., et al. | Case No. 16-10223 (MFW) |
Declaration Regarding the Status of Post-petition taxes of the Debtors
I am the Chief Accounting Officer of RCS Capital Corp. a corporation organized under the laws of the State of Delaware and the Debtor in the above-caption Chapter 11 cases (the Debtors). I am familiar with the Debtors day to day operations, business affairs and books and records.
To the best of my knowledge, the Debtors have filed all necessary federal, state and local tax returns or extensions and made all required undisputed post-petition tax payments in connection therewith in a timely manner or have promptly remediated any late filings or payments that may have occurred due to unintentional oversights.
/s/ Salvatore Troia |
3/31/16 | |||
Salvatore Troia | Date |