-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JL/cVrtbMcDBbmsQ4w5yPcXfK9d4GUskdwLNGHNENP/yksgJSCz9n+FwNev5ukmx O3yviZR2B/m2NkEBUnLNyQ== 0000950144-01-509525.txt : 20020411 0000950144-01-509525.hdr.sgml : 20020411 ACCESSION NUMBER: 0000950144-01-509525 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20011001 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20011121 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SERVICE MERCHANDISE CO INC CENTRAL INDEX KEY: 0000089107 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-MISC GENERAL MERCHANDISE STORES [5399] IRS NUMBER: 620816060 STATE OF INCORPORATION: TN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09223 FILM NUMBER: 1798071 BUSINESS ADDRESS: STREET 1: 7100 SERVICE MERCHANDISE BLVD CITY: BRENTWOOD STATE: TN ZIP: 37027 BUSINESS PHONE: 6156606000 MAIL ADDRESS: STREET 1: PO BOX 24600 CITY: NASHVILLE STATE: TN ZIP: 37202 8-K 1 g72960e8-k.htm SERVICE MERCHANDISE COMPANY,INC. e8-k
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report: October 1, 2001

SERVICE MERCHANDISE COMPANY, INC.
(Debtor-in-Possession as of March 27, 1999)

(Exact name of registrant as specified in its charter)
         
Tennessee   1-9223   62-0816060
 
 
(State or other jurisdiction of incorporation)   (Commission File Number)   (I.R.S. Employer
Identification No.)
         
7100 Service Merchandise Boulevard, Brentwood, TN       37027  
     
 
(Address of principal executive offices)     (Zip code)

Registrant’s telephone number, including area code: (615) 660-6000

Not Applicable

(Former name or former address, if changed since last report)

 

Item 5. Other Events
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
SIGNATURES
MONTHLY OPERATING REPORT

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Item 5. Other Events

     Service Merchandise Company, Inc. (the “Company”) has filed its monthly operating report for the period commencing October 1, 2001 and ended October 28, 2001 (the “Operating Report”) with the United States Bankruptcy Court for the Middle District of Tennessee, a copy of which is attached hereto as Exhibit 99 in connection with its voluntary petitions for reorganization under Chapter 11 of title 11 of the United States Bankruptcy Code in Case No. 399-02649.

     The Company cautions readers not to place undue reliance upon the information contained therein. The Operating Report contains unaudited information, and is in a format, prescribed by the applicable bankruptcy laws. There can be no assurance that the Operating Report is complete. The Operating Report also contains information for periods which may be shorter or otherwise different from those contained in the Company’s reports pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such information may not be indicative of the Company’s financial condition or operating results for the periods reflected in the Company’s financial statements or in its reports pursuant to the Exchange Act and readers are cautioned to refer to the Exchange Act filings. Moreover, the Operating Report and other communications from the Company may include forward-looking statements subject to various assumptions regarding the Company’s operating performance that may not be realized and are subject to significant business, economic and competitive uncertainties and contingencies, including those described in this report, many of which are beyond the Company’s control. Consequently such matters should not be regarded as a representation or warranty by the Company that such matters will be realized or are indicative of the Company’s financial condition or operating results for future periods or the periods covered in the Company’s reports pursuant to the Exchange Act. Actual results for such periods may differ materially from the information contained in the Operating Report and the Company undertakes no obligation to update or revise the Operating Report.

     The Operating Report includes a Rolling Revised Cash Flow Forecast which is a forward-looking statement subject to various assumptions regarding the Company’s business, operating performance and other factors including revenues, expenses, asset dispositions, trade terms and capital expenditures, and various risks and uncertainties including those set forth below. This information should be read in conjunction with the Company’s reports filed pursuant to the Exchange Act. Readers are cautioned that such information is being reported publicly because it is being distributed to a large number of the Company’s vendors for purposes of their credit analyses. The Company undertakes no obligation to update such information or to disclose similar information in future operating reports. The Rolling Revised Cash Flow Forecast was not examined, reviewed or compiled by the Company’s independent public accountants. The Rolling Revised Cash Flow Forecast is subject to future adjustments, if any, that could materially affect such information.

     The Company’s liquidity, capital resources and results of operations are subject to a number of risks and uncertainties including, but not limited to, the following: the ability of the Company to continue as a going concern; the ability of the Company to operate pursuant to the terms of and access liquidity from the DIP to Exit Facility; the ability of the Company to convert

 

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the DIP to Exit Facility to an exit facility or to obtain an alternative exit facility to provide financing upon its anticipated emergence from Chapter 11; the ability of the Company to develop, prosecute, confirm and consummate on a timely basis one or more plans of reorganization with respect to the Chapter 11 Cases and to exit Chapter 11; trends in the economy as a whole and the events of September 11, 2001 which are negatively affecting consumer confidence and consumer demand for the types of goods sold by the Company; the ability of the Company to successfully implement the 2001 Business Plan initiatives; risks associated with third parties seeking and obtaining court approval to terminate or shorten the exclusivity period for the Company to propose and confirm one or more plans of reorganization, for the appointment of a Chapter 11 trustee or to convert the Company’s cases to Chapter 7 cases; the ability of the Company to reduce its workforce and related expenses and to achieve anticipated cost savings; the ability of the Company to obtain trade credit and shipments and terms with vendors and service providers for current orders; the ability of the Company to sublease successfully additional portions of its real estate and to consummate the sale/leaseback of its headquarters; the successful consolidation of its distribution centers; the ability of the Company to access liquidity from the DIP to Exit Facility upon its anticipated emergence from Chapter 11; adverse developments with respect to the Company’s liquidity or results of operations; the impact of additional store closings and related inventory liquidations, cost cutting measures, and additional inventory, logistics, and staffing rationalizations; competitive pressures from other retailers, including specialty retailers and discount stores, which may affect the nature and viability of the Company’s business strategy; the seasonal nature of the Company’s business and the ability of the Company to predict consumer demand as a whole, as well as demand for specific goods; the ability to fund and execute its business plan; the ability of the Company to attract, retain and compensate key executives and associates; the ability of the Company to attract and retain customers; potential adverse publicity; and uncertainties regarding real estate occupancy and development costs, including the substantial fixed investment costs associated with opening, maintaining or closing a Company store.

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits

     (c)      Exhibits

     99.      Monthly Operating Report for period ended October 28, 2001.

 

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SIGNATURES

     Pursuant to the requirements of Section 12 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.

         
  SERVICE MERCHANDISE COMPANY, INC.
 
     
 
Date:  November 20, 2001 By: /s/ C. Steven Moore
        C. Steven Moore
Senior Vice President, Chief Administrative
Officer, Secretary and General Counsel

 

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EXHIBIT INDEX

             
No.   Exhibit        
 
       
99   Monthly Operating Report for the period ended October 28, 2001.

  EX-99 3 g72960ex99.txt MONTHLY OPERATING REPORT UNITED STATES BANKRUPTCY COURT MIDDLE DISTRICT OF TENNESSEE In re: Case No.: 399-02649 THROUGH 399-02680 --------------------------- SERVICE MERCHANDISE COMPANY, INC. Judge: PAINE --------------------------------- ---------------------------- Chapter 11 Debtor(s) MONTHLY OPERATING REPORT FOR PERIOD ENDING October 28, 2001 ------------------- COMES NOW, SERVICE MERCHANDISE COMPANY, INC. -------------------------------------------------- Debtor-In-Possession, and hereby submits its Monthly Operating Report for the period commencing October 1, 2001 and ending October 28, 2001 as shown by the report and exhibits consisting of 15 pages and containing the following as indicated: X Monthly Reporting Questionnaire (Attachment 1) --- X Comparative Balance Sheets (Forms OPR-1 & OPR-2) --- N/A Summary of Accounts Receivable (Form OPR-3) --- X Schedule of Postpetition Liabilities (Form OPR-4) --- X Statement of Income (Loss) (Form OPR-5) --- I declare under penalty of perjury that this report and all the attachments are true and correct to the best of my knowledge and belief. I also hereby certify that the original Monthly Operating Report was filed with the Bankruptcy Court Clerk and a copy delivered to the U.S. Trustee. Date: 11/19/01 DEBTOR - IN - POSSESSION -------- By: /s/ Kenneth A. Conway ---------------------------------------- Name and Title: KENNETH A. CONWAY, VICE PRESIDENT AND CONTROLLER --------------------------- Address: 7100 SERVICE MERCHANDISE DRIVE BRENTWOOD, TENNESSEE 37027 ---------------------------------- Telephone No: (615) 660-3340 ----------------------------- Note: Report subject to further verification and account reconciliation procedures Page 1 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 1. Payroll
WAGES TAXES OFFICERS TITLE GROSS NET DUE PAID - -------------------------------------------------------------------------------------------------------------------------------- S. CUSANO CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER $ 57,717.35 $ 36,959.58 $5,147.07 $15,180.07 JANE F. GILMARTIN PRESIDENT AND CHIEF MERCHANDISING OFFICER $196,399.10 $137,417.39 $3,387.78 $55,218.55 C. STEVEN MOORE SENIOR VICE PRESIDENT, CHIEF ADMINISTRATIVE OFFICER, GENERAL COUNSEL AND SECRETARY $ 27,752.86 $ 18,895.42 $2,108.21 $ 6,477.00 MICHAEL E. HOGREFE SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER $ 23,902.86 $ 16,493.60 $1,744.62 $ 5,396.33 ERIC A. KOVATS SENIOR VICE PRESIDENT, STORES $ 22,000.46 $ 15,318.27 $1,479.16 $ 4,577.80 KARREN M. PRASIFKA VICE PRESIDENT, ASSISTANT GENERAL COUNSEL $ 16,981.73 $ 11,531.92 $1,343.85 $ 3,967.43 KENNETH A. CONWAY VICE PRESIDENT AND CONTROLLER $ 13,121.02 $ 10,222.96 $ 686.37 $ 2,017.51 JOE M. ELLIOTT VICE PRESIDENT, PROPERTY ADMINISTRATION $ 11,648.48 $ 8,440.46 $ 677.87 $ 1,930.15 KIMBERLY B. SOUTHARD ASSISTANT VICE PRESIDENT, STRATEGIC PLANNING AND ASSISTANT TREASURER $ 8,864.66 $ 5,900.14 $ 673.79 $ 2,003.91
The following associate received a payment, in accordance with the terms of her employment agreement, that is included in the amounts above. JANE F. GILMARTIN $156,250.00
Page 2 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 2. INSURANCE
COVERAGE POLICY EXPIRATION PREMIUM DATE COVERAGE TYPE NAME OF CARRIER AMOUNT NUMBER DATE AMOUNT PAID THROUGH - --------------------------------------------------------------------------------------------------------------------------------- Property Fireman's Fund Insurance Co $5 Million 01MXI97600751 12/31/01 $685,000 12/31/01 Royal Indemnity Co. $5 Million RHD317182 12/31/01 $ 90,250 12/31/01 Westchester Fire $15 Million 1XA394430-0 12/31/01 $ 64,125 12/31/01 Allianz Insurance Co $12 Million CLP1036568 12/31/01 $ 26,583 12/31/01 TIG Insurance Co $13 Million XPT38844629 12/31/01 $ 28,730 12/31/01 Westchester Fire $20 Million 1XA394429-0 12/31/01 $ 13,500 12/31/01 Allianz Insurance Co $30 Million CLP1036568 12/31/01 $ 20,250 12/31/01 Allianz Insurance Co $25 Million CLP1036568 12/31/01 $ 8,500 12/31/01 Boiler & Machinery Hartford Steam Boiler $10 Million 4914359 12/31/01 $ 9,934 12/31/01 Transit Fireman's Fund Insurance Co $1 Million CCIMG72820 12/31/01 $ 10,000 12/31/01 Ocean Cargo Fireman's Fund Insurance Co $10 Million CR37211 12/31/01 $ 40,000 12/31/01 General Liability Ace American Ins Co $5 Million XSLG20577009 12/31/01 $212,279 12/31/01 Workers' Compensation Pacific Employers Ins Co Statutory WLRC43024516 12/31/01 $136,566 12/31/01 WC Excess Ace American Ins Co Statutory XWC014026 12/31/01 $ 12,108 12/31/01 WC Contractual Indemnity Illinois Union Insurance Co Statutory CTPG20577344 12/31/01 $ 20,500 12/31/01 Auto Pacific Employers Ins Co $1 Million ISAH07968358 12/31/01 $ 33,518 12/31/01 Umbrella Ohio Casualty Group $50 Million BXO52805120 12/31/01 $ 88,250 12/31/01 Excess Liability Zurich American of Illinois $50 Million AEC287610703 12/31/01 $ 30,000 12/31/01 International Ace American Ins Co $1 Million PHF051491 12/31/01 $ 2,500 12/31/01 Punitive Damages Magna Carta Ins. Ltd. $50 Million MCPD201058 12/31/01 $ 40,000 12/31/01 Punitive Damages - Excess Zurich Ins. Co Bermuda Branch $50 Million ZICBB-091 PD 12/31/01 $ 5,000 12/31/01 Directors & Officers Continental Insurance Co $10 Million 300714943 03/01/02 $200,000 03/01/02 Federal Insurance Co $10 Million 81278902-A 03/01/02 $190,000 03/01/02 Royal Insurance Co $10 Million PSF000009 03/01/02 $175,000 03/01/02 Greenwich Ins. Co. $10 Million ELU82217-01 03/01/02 $198,949 03/01/02 Zurich-American Ins. Co. $10 Million DOC3746468-00 03/01/02 $146,704 03/01/02 Kemper Insurance Co $10 Million 3DY00200100 03/01/02 $ 99,110 03/01/02 Crime National Union Fire Ins Co $10 Million 8726439 03/01/02 $ 53,833 03/01/02 Fiduciary National Union Fire Ins Co $10 Million 8726812 03/01/02 $ 25,839 03/01/02 Employment Practices Liability Chubb Insurance Co $5 Million 81278901A 03/01/02 $100,000 03/01/02 National Union Fire Ins Co $5 Million 8727499 03/01/02 $ 70,000 03/01/02 Royal Insurance Co $10 Million PSF000010 03/01/02 $ 85,000 03/01/02 Special Crime Reliance Insurance Co $25 Million NFK1951937 05/01/02 $ 13,458 05/01/02
Page 3 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 3. BANK ACCOUNTS TOTAL CASH AND CASH EQUIVALENTS CASH IN STORES AND HOME OFFICE HOME OFFICE $ 4,950 RETAIL SAFE FUNDS 1,772,496 CORPORATE ACCOUNTS 2,127,389 STORE DEPOSITORY ACCOUNTS FIRST TENNESSEE 589,946 KEY NATIONAL BANK 236,087 FLEET BOSTON 317,478 FIRST UNION 2,217,391 BANK ONE LOUISIANA 261,810 ABN - AMRO BANK 115,845 COMERICA BANK 124,040 AM SOUTH 237,149 BANK OF AMERICA 168,799 BANK OF OKLAHOMA 109,600 CHASE BANK OF TEXAS 693,235 SINGLE STORE DEPOSITORY ACCOUNTS 216,954 WELLS FARGO BANK 40,150 BANK ONE, IN 103,187 PNC BANK 393,760 OAK BROOK BANK 478,035 CREDIT CARD CASH ACCOUNTS (SALES PROCESSED BY CREDIT CARD COMPANY) 6,276,228 OTHER DEPOSITORY ACCOUNTS SERVICE MERCHANDISE - MUSCULAR DYSTROPHY ASSOC. 85,324 OTHER CASH ACCOUNTS 572,704 ----------- TOTAL CASH PER GENERAL LEDGER $17,142,557 ===========
Page 4 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 RECEIPTS AND DISBURSEMENTS (DOLLARS IN THOUSANDS)
ACTUAL ACTUAL ACTUAL ACTUAL TOTAL Monday 10/01/01 10/08/01 10/15/01 10/22/01 10/01/01 Sunday 10/07/01 10/14/01 10/21/01 10/28/01 10/28/01 -------- -------- -------- -------- --------- Receipts: Sales receipts $ 10,198 $ 12,943 $ 12,268 $ 15,302 $ 50,711 Miscellaneous receipts 1,088 654 -- 849 2,591 -------- -------- -------- -------- --------- Total available collections 11,286 13,597 12,268 16,151 53,302 Disbursements: Merchandise disbursements 15,699 16,542 21,167 21,440 74,848 Non-merchandise disbursements 15,021 10,169 12,590 12,684 50,464 -------- -------- -------- -------- --------- Total disbursements 30,720 26,711 33,757 34,124 125,312 -------- -------- -------- -------- --------- Net receipts/(disbursements) $(19,434) $(13,114) $(21,489) $(17,973) $ (72,010) ======== ======== ======== ======== =========
Page 5 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 ROLLING REVISED CASH FLOW FORECAST (DOLLARS IN THOUSANDS)
ACTUAL ACTUAL FORECAST FORECAST 10/28/01 11/11/01 11/25/01 12/30/01 -------- -------- -------- -------- Ending total revolver balance $304,196 $335,393 $349,966 $ 95,414 Term loan 60,000 60,000 60,000 60,000 Standby letters of credit 23,572 24,416 23,416 21,310 Trade letters of credit 19,800 16,651 21,128 29,503 -------- -------- -------- -------- Total extensions of credit 407,568 436,460 454,510 206,227 Borrowing base 505,602 504,022 511,527 369,507 -------- -------- -------- -------- Availability $ 98,034 $ 67,562 $ 57,017 $163,280 ======== ======== ======== ========
Page 6 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 4. Payments to Professionals October 1, 2001 through October 28, 2001
VENDOR # VENDOR NAME CHECK AMT. CHECK DATE CHECK # - ------------------------------------------------------------------------------------------------------------------- 99329 Aegis Property Tax Solutions $ 16,126.87 10/01/01 50054585 102914 Ernst and Young, LLP $ 2,766.00 10/04/01 50054852 86237 Brusniak, Clement, Harrison and McCool, PC $ 250.00 10/05/01 50054984 99329 Aegis Property Tax Solutions $ 14,831.25 10/05/01 50054989 57117 Deloitte and Touche $ 4,195.00 10/08/01 50055158 57117 Deloitte and Touche $ 86,950.00 10/09/01 50055243 2642 Waller, Lansden, Dortch and Davis $ 2,030.56 10/12/01 50055492 67017 Barkley and Thompson $ 3,786.78 10/12/01 50055535 84740 Taft, Stettinius and Hollister $ 88.00 10/12/01 50055538 96221 Holt and Babington $ 336.97 10/12/01 50055539 96684 Sherbow and Mitchell, PC $ 1,131.48 10/12/01 50055540 48779 Loss, Pavone and Orel $ 187.50 10/15/01 50055642 99104 Jay Alix and Associates $ 8,931.99 10/15/01 B0025911 99459 Robert L Berger and Associates $ 13,411.45 10/18/01 B0025962 57117 Deloitte and Touche $ 90,674.00 10/25/01 50056867 101232 E & Y Capital Advisors $141,609.00 10/25/01 B0026036 95384 Deloitte and Touche, LLP $ 10,336.08 10/26/01 50056950 101606 Service Real Estate Venture $ 1,327.93 10/26/01 B0026042 101993 Rothschild, Inc. $ 86,582.21 10/26/01 B0026043 98378 Skadden, Arps, Meagher and Flom $459,799.00 10/26/01 B0026048 99104 Jay Alix and Associates $ 6,903.55 10/26/01 B0026049 99391 Otterbourg, Steindler, Houston and Rosen,PC $ 94,100.03 10/26/01 B0026050 99444 Sitrick and Company, Inc. $ 2,974.42 10/26/01 B0026051 99454 Harwell, Howard, Hyne, Gabbert and Manner, PC $ 21,194.91 10/26/01 B0026052
Page 7 FORM OPR - 1 AND 2 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (DEBTOR-IN-POSSESSION) (IN THOUSANDS)
OCTOBER 28, SEPTEMBER 30, 2001 2001 ----------- ------------- ASSETS Current Assets: Cash and cash equivalents $ 17,143 $ 17,760 Accounts receivable 7,116 7,895 Inventories 540,175 483,632 Prepaid Expenses 15,804 12,365 ----------- ----------- TOTAL CURRENT ASSETS 580,238 521,652 ----------- ----------- PROPERTY AND EQUIPMENT Owned assets, net of accumulated depreciation 344,566 346,148 Capitalized leases, net of accumulated amortization 10,571 10,705 ----------- ----------- TOTAL PROPERTY AND EQUIPMENT 355,137 356,853 ----------- ----------- Other assets and deferred charges 35,803 36,296 ----------- ----------- TOTAL ASSETS $ 971,178 $ 914,801 =========== =========== LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY Liabilities Not Subject To Compromise Current Liabilities: Notes payable to banks $ 304,196 $ 231,312 Accounts payable 65,964 66,646 Accrued expenses 88,901 88,189 State & local sales tax 7,544 9,110 Current maturities capitalized leases 100 99 ----------- ----------- TOTAL CURRENT LIABILITIES 466,705 395,356 ----------- -----------
Page 8 FORM OPR - 1 AND 2 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (DEBTOR-IN-POSSESSION) (IN THOUSANDS)
OCTOBER 28, SEPTEMBER 30, 2001 2001 ----------- ------------- Long-Term Liabilities: Long-term debt 60,000 60,000 Capitalized lease obligations 2,312 2,321 Liabilities Subject To Compromise: Accrued restructuring costs 42,068 42,068 Capitalized lease obligations 19,491 19,767 Long-term debt 407,051 408,470 Accounts payable 199,211 198,522 Accrued expenses 94,140 93,195 ----------- ----------- Total Liabilities Subject To Compromise 761,961 762,022 TOTAL LIABILITIES 1,290,978 1,219,699 ----------- ----------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' (DEFICIT) EQUITY Common stock 49,935 49,935 Additional paid-in-capital 5,881 5,881 Deferred compensation (115) (125) Accumulated other comprehensive loss (1,941) (1,941) Retained (deficit) earnings (373,560) (358,648) ----------- ----------- TOTAL SHAREHOLDERS' (DEFICIT) EQUITY (319,800) (304,898) TOTAL LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY $ 971,178 $ 914,801 =========== ===========
Page 9 CHAPTER 11 MONTHLY OPERATING REPORT CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 SUMMARY OF ACCOUNTS RECEIVABLE MONTH ENDED: OCTOBER 28, 2001 FORM OPR-3 NOT APPLICABLE Page 10 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. Al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 SCHEDULE OF POST PETITION LIABILITIES-ACCOUNTS PAYABLE Month Ended: 10/28/2001 FORM OPR-4
TOTAL -------- Trade Accounts Payable (Merchandise) $ 65,964
TOTAL -------- Expense & other payables $ 88,901
Page 11 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. et. al. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 SCHEDULE OF POST PETITION LIABILITIES FORM OPR-4 (Dollars in Thousands)
DATE DATE TOTAL TAXES PAYABLE INCURRED DUE DUE Federal income tax ** Various Various $ 8,293 State income tax Various Various (250) ------- SUBTOTAL $ 8,043 ------- Sales/use tax SUBTOTAL * Various Various $ 8,307 ------- Personal property tax * Various Various $ 2,549 Real estate taxes * Various Various 13,198 Inventory taxes * Various Various -- Gross receipts/bus licenses * Various Various 252 Franchise taxes * Various Various 375 ------- SUBTOTAL $16,374 ------- TOTAL TAXES PAYABLE $32,724 =======
* liability included in accrued expenses on OPR-2 ** tax reserve Page 12 CHAPTER 11 MONTHLY OPERATING REPORT MONTHLY REPORTING QUESTIONNAIRE CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL. CASE NUMBER: 399-02649 THROUGH 399-02680 PERIOD: OCTOBER 1, 2001 THROUGH OCTOBER 28, 2001 SCHEDULE OF POST PETITION LIABILITIES FORM OPR-4 (DOLLARS IN THOUSANDS)
DATE TOTAL DUE INCURRED DATE DUE (10/28/01 BALANCE) ------------------------------------------------------------------------- POST PETITION SECURED DEBT Revolver borrowings 04/14/00 04/14/04 $ 304,196 Facility standby letters of credit 04/14/00 04/14/04 23,572 Facility trade letters of credit 04/14/00 04/14/04 19,800 Term loans 04/14/00 04/14/04 60,000 --------- TOTAL EXTENSIONS OF CREDIT $ 407,568 ========= ACCRUED INTEREST PAYABLE $ 1,189 =========
Page 13 FORM OPR-5 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (DEBTOR-IN-POSSESSION) (IN THOUSANDS)
ACTIVITY ACTIVITY ACTIVITY YTD ACTIVITY YTD OCTOBER 1, 2001 OCTOBER 2, 2000 JANUARY 1, 2001 JANUARY 3, 2000 THROUGH THROUGH THROUGH THROUGH OCTOBER 28, 2001 OCTOBER 29, 2000 OCTOBER 28, 2001 OCTOBER 29, 2000 ---------------- ---------------- ---------------- ---------------- Net Sales $ 48,296 $ 73,531 $ 684,943 $ 1,108,447 Costs of merchandise sold and buying and occupancy expense 37,038 57,080 507,194 877,547 -------- -------- --------- ----------- Gross margin after cost of merchandise sold and buying and occupancy expenses 11,258 16,451 177,749 230,900 Selling, General and Administrative Expenses: Net Employment Expense 11,854 18,002 137,063 237,976 Net Advertising 1,456 6,947 40,070 61,482 Banking and Other Fees 814 1,048 12,749 15,881 Real Estate and Other Taxes 1,770 1,719 18,714 19,148 Supplies 1,086 1,441 6,763 9,511 Communication and Equipment 311 373 3,185 3,904 Travel 271 863 3,336 5,556 UCC and Other Services (788) (702) (4,086) (7,392) Legal and Professional 373 446 3,425 3,285 Sales and Shipping 39 71 1,010 1,096 Insurance 401 339 4,287 3,872 Miscellaneous 45 62 527 (10) Credit Card Services (3) (54) (22,039) (500) -------- -------- --------- ----------- Total Selling, General and Administrative Expenses 17,629 30,555 205,004 353,809 Other expense/(income), net (1) (2) 1,383 (14,793)
Page 14 FORM OPR-5 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (DEBTOR-IN-POSSESSION) (IN THOUSANDS)
ACTIVITY ACTIVITY ACTIVITY YTD ACTIVITY YTD OCTOBER 1, 2001 OCTOBER 2, 2000 JANUARY 1, 2001 JANUARY 3, 2000 THROUGH THROUGH THROUGH THROUGH OCTOBER 28, 2001 OCTOBER 29, 2000 OCTOBER 28, 2001 OCTOBER 29, 2000 ---------------- ---------------- ---------------- ---------------- Restructuring charge (credit) -- 97 -- (2,428) Depreciation and amortization 3,126 3,033 34,200 32,384 -------- -------- --------- ----------- Earnings (loss) before interest, reorganization items, and income tax (9,496) (17,232) (62,838) (138,072) Interest expense - debt 3,062 3,274 31,769 30,196 Interest expense - capitalized leases 248 283 2,610 2,976 -------- -------- --------- ----------- Earnings (loss) before reorganization items, and income tax (12,806) (20,789) (97,217) (171,244) Reorganization Items: Severance -- -- -- 9,423 Legal and Professional 1,659 1,997 20,334 32,363 Miscellaneous 206 197 2,330 2,341 Loss (Gain) on Disposal of Assets 16 2,149 1,094 (3,057) Close Store Charges 225 (142) 246 320 -------- -------- --------- ----------- Total Reorganization Items 2,106 4,201 24,004 41,390 Earnings (loss) before income tax (14,912) (24,990) (121,221) (212,634) Income tax benefit -- -- -- -- Cumulative Effect of Change in Accounting Principles -- -- -- -- -------- -------- --------- ----------- Net earnings (loss) $(14,912) $(24,990) $(121,221) $ (212,634) ======== ======== ========= ===========
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