EX-99.4 5 jan08.htm JANUARY 2008 jan08.htm

UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
         
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
Complete
Explanation
Attached
Affidavit/Supplement
Attached
Schedule of Cash Receipts and Disbursements
 MOR-1
 
    
   Bank Reconciliation (or copies of Debtor's 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
    
 
MOR
 
 
 
I declare under penalty of perjury (28 U.S.C. Section 1746) that the information contained in this monthly operating report (including attached schedules) is true and correct to the best of my knowledge, information, and belief.
 
debtor signature
  
5 / 5 / 08
 
Signature of Debtor
  
Date
     
     
     
Signature of Joint Debtor
  
Date
     
     
     
Signature of Authorized Individual
  
Date
     
     
     
Printed Name of Authorized Individual
  
Date
     
 
 
Page 1 of  9
 
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
NEW ENGLAND AUDIO CO., INC.
SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
 
Amounts reported should be per the Debtor's books, not the bank statement. The beginning cash should be the ending cash from the prior month or, if this is the first report, the amount should be the balance on the date the petition was filed.  The amounts reported in the "CURRENT MONTH - ACTUAL" column must equal the sum of the four bank account columns. The amounts reported in the "PROJECTED" columns should be taken from the SMALL BUSINESS INITIAL REPORT (FORM IR-1). Attach copies of the bank statements and the cash disbursements journal.  The total disbursements listed in the disbursements journal must equal the total disbursements reported on this page.  A bank reconciliation must be attached for each account. [See MOR-1 (CON'T)]
 
   
BANK ACCOUNT
    
CURRENT MONTH
    
CUMULATIVE
  
   
OPER
    
PAYROLL
    
TAX
    
OTHER
    
ACTUAL
    
ACTUAL
  
CASH BEGINNING OF MONTH
   $ 3,957,631     $ -     $ -     $ -     $ 3,957,631     $ 1,751,382  
RECEIPTS
                                                
                                                 
CASH SALES
     -       -       -       -       -       29,728,211  
ACCOUNTS RECEIVABLE
     41,933       -       -       -       41,933       9,658,333  
LOANS AND ADVANCES
     -       -       -       -       -       -  
SALE OF ASSETS
     -       -       -       -       -       8,011,316  
OTHER (ATTACH LIST)
     -       -       -       -       -       970,620  
TRANSFERS (FROM DIP ACCTS)
     -       -       -       -       -       -  
                                                 
TOTAL RECEIPTS
     41,933       -       -       -       41,933       48,368,480  
DISBURSEMENTS
                                                
AP CHECK REGISTER
     (1,354 )     -       -       -       (1,354 )     (7,897,310 )
WIRES
     (65,618 )     -       -       -       (65,618 )     (21,398,806 )
Other
     -       -       -       -       -       (12,060,557 )
                                                 
PROFESSIONAL FEES
     (230,072 )     -       -       -       (230,072 )     (5,058,669 )
U.S. TRUSTEE QUARTERLY FEES
     (2,000)       -       -       -       (2,000 )     (4,000 )
COURT COSTS
     -       -       -       -       -       -  
                                                 
TOTAL DISBURSEMENTS
     (299,043 )     -       -       -       (299,043 )     (46,419,341 )
                                                 
NET CASH FLOW
     (257,110 )     -       -       -       (257,110 )     1,949,139  
Adjustment - Voided Checks     100,678                               100,678       100,678   
(RECEIPTS LESS DISBURSEMENTS)
                                                
                                                 
CASH - END OF MONTH
   $ 3,801,199     $ -     $ -     $ -     $ 3,801,199     $ 3,801,199  
* COMPENSATION TO SOLE PROPRIETORS FOR SERVICES RENDERED TO BANKRUPTCY ESTATE
          
                                                 
THE FOLLOWING SECTION MUST BE COMPLETED
  
                                                 
TOTAL DISBURSEMENTS
                                           $ (299,043 )
LESS: TRANSFERS TO DEBTOR IN POSSESSION ACCOUNTS
                               -  
PLUS: ESTATE DISBURSEMENTS MADE BY OUTSIDE SOURCES (i.e. from escrow account)
               -  
TOTAL DISBURSEMENTS FOR CALCULATING U.S. TRUSTEE QUARTERLY FEES
             $ (299,043 )
                                                 
                                           
FORM MOR-1
  
                                                 
Note:
All of the Debtors disbursement accounts are in the name of New England Audio Co, Inc except for the manual payroll account is in the name of Tweeter Home Entertainment Group, Inc.  Disbursements for both debtors are summarized herein.
 
(1) Adjustment: Reconciliation of voided checks by the Company.
 

Page 2 of 9
 
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
TWEETER HOME ENTERTAINMENT GROUP, INC.
SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
 
Amounts reported should be per the Debtor's books, not the bank statement.  The beginning cash should be the ending cash from the prior month or, if this is the first report, the amount should be the balance on the date the petition was filed.  The amounts reported in the "CURRENT MONTH - ACTUAL" column must equal the sum of the four bank account columns.  The amounts reported in the "PROJECTED" columns should be taken from the SMALL BUSINESS INITIAL REPORT (FORM IR-1). Attach copies of the bank statements and the cash disbursements journal.  The total disbursements listed in the disbursements journal must equal the total disbursements reported on this page.  A bank reconciliation must be attached for each account. [See MOR-1 (CON'T)]
                 
 
BANK ACCOUNT
  
CURRENT MONTH
  
CUMULATIVE
 
OPER
PAYROLL
TAX
OTHER
  
ACTUAL
  
ACTUAL
CASH BEGINNING OF MONTH
 $                           -
 $                           -
 $                           -
 $                           -
  
 $                                             -
  
 $              151,056
RECEIPTS
                
                 
CASH SALES
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
ACCOUNTS RECEIVABLE
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
LOANS AND ADVANCES
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
SALE OF ASSETS
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
OTHER (ATTACH LIST)
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
TRANSFERS (FROM DIP ACCTS)
                               -
                               -
                               -
                               -
  
                                                 -
  
              5,125,286
                 
TOTAL RECEIPTS
                               -
                               -
                               -
                               -
  
                                                 -
  
              5,125,286
DISBURSEMENTS
                
PAYROLL ISSUED
                               -
                               -
                               -
                               -
  
                                                 -
  
           (5,276,342)
                 
PROFESSIONAL FEES
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
U.S. TRUSTEE QUARTERLY FEES
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
COURT COSTS
                               -
                               -
                               -
                               -
  
                                                 -
  
                               -
                 
TOTAL DISBURSEMENTS
  
                               -
                               -
                               -
  
                                                 -
  
           (5,276,342)
                 
NET CASH FLOW
                               -
                               -
                               -
                               -
  
                                                 -
  
                (151,056)
(RECEIPTS LESS DISBURSEMENTS)
                
                 
CASH - END OF MONTH
 $                           -
 $                           -
 $                           -
 $                           -
  
 $                                             -
  
 $                           -
* COMPENSATION TO SOLE PROPRIETORS FOR SERVICES RENDERED TO BANKRUPTCY ESTATE
    
                 
THE FOLLOWING SECTION MUST BE COMPLETED
                 
TOTAL DISBURSEMENTS
              
 $                           -
LESS: TRANSFERS TO DEBTOR IN POSSESSION ACCOUNTS
          
                               -
PLUS: ESTATE DISBURSEMENTS MADE BY OUTSIDE SOURCES (i.e. from escrow account)
      
                               -
TOTAL DISBURSEMENTS FOR CALCULATING U.S. TRUSTEE QUARTERLY FEES
      
 $                           -
                 
               
FORM MOR-1
 
 
 
Page 3 of 9
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
BANK RECONCILIATIONS
    
Continuation Sheet for MOR-1
    
A bank reconciliation must be included for each bank account.
    
The Debtor's bank reconciliation may be submitted for this page.
    
     
   
Operating Account
    
Professional Fee Reserve Account
    
Deposit
Account
    
Polk Reserve Account
    
Utility Reserve Account
    
Total
      
      4426430962       4426448213       4426438621       4426448242       4426448239    
 4426448226
      
BALANCE FOR BOOKS
   $ 29,756     $ 189,461     $ 2,694,480     $ -     $ 300,000     $ 587,500    $
3,801,199
                                                     
BANK BALANCE
     175,652       189,461       2,694,480       -       300,000       587,500    $
3,947,294
(+) DEPOSITS IN TRANSIT (ATTACH LIST)
                                                  
- 
(-) OUTSTANDING CHECKS (ATTACH LIST)
     (146,094 )       -       -        -        -        -    
(146,094)
OTHER (ATTACH EXPLANATION)
                                                  
- 
ADJUSTED BANK BALANCE*
   $ 29,756     $ 189,461     $ 2,694,480     $ -     $ 300,000     $ 587,500    $
3,801,199
*Adjusted bank balance must equal
                                                    
   balance per books
                                                    
 
Outstanding Checks as of 1/31/2007
 
Ch.#
Amount
  
Ch.#
Amount
  
Ch.#
Amount
  
600031
$                    25.00
  
600520
$                  84.67
  
801210
$                    70.00
  
600044
4.26
  
600749
1,419,67
  
801353
100.27
  
600103
112.59
  
600791
175.00
  
801365
5.02
  
600147
51.18
  
600832
427.49
  
801367
9.03
  
600163
39.00
  
600846
455.80
  
801394
4.21
  
600186
73.50
  
600907
4,451.89
  
801422
7.89
  
600204
121.31
  
600908
750.00
  
801522
1,171.83
  
600211
110.98
  
800032
7.58
  
801535
40.00
  
600258
10.60
  
800096
90.14
  
801564
62.27
  
600262
7.20
  
800105
50.00
  
801577
314.52
  
600266
106.00
  
800110
7.00
  
801594
9,850.00
  
600286
50.00
  
800188
199.43
  
801613
50.00
  
600304
102.90
  
800257
94.05
  
801865
783.61
  
600367
833.24
  
800562
50.00
  
801867
133.06
  
600396
237.44
  
800709
118.36
  
801885
55.30
  
600404
78.77
  
800842
50.00
  
801891
1,631.53
  
600408
1,112.97
  
800848
7.02
  
801919
11,336.33
  
600417
1,169.95
  
800892
96,615.00
  
801924
1,163.97
  
600441
62.99
  
801171
9,438.00
        
600456
500.00
  
801203
4.42
        
                 
           
Total
$           146,094.24
  
                 
 
Page 4 of 9
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
SCHEDULE OF PROFESSIONAL FEES AND EXPENSES PAID
This schedule is to include all retained professional payments from case inception to current month.
 
PAYEE
PERIOD
COVERED
AMOUNT
APPROVED (1)
WIRE/CHECK
AMOUNT PAID
YEAR-TO-DATE (2)
  
     
NUMBER
DATE
FEES
EXPENSES
FEES
EXPENSES
  
Skadden, Arps, Slate Meagher & Flom LLP
November '07
 $116,206.44
Wire
1/4/08
 $106,739.20
 $ 9,467.24
 $1,437,954.25
 $93,144.04
                 
KCC
August '07
44,552.86
Wire
  
 11,341.60
  
 671,281.02
 -
 
October '07
 58,528.61
Check #801915
1/18/08
 58,528.61
      
 
November '07
 13,587.74
Wire
1/4/08
 13,587.74
      
 
December '07
11,336.33
Check #801919
1/23/08
11,336.33
      
                 
BTB Associates
November '07
 6,570.78
Check #801913
1/3/08
6,432.00
138.78
 21,441.50
 206.62
                 
                 
Vitale
December '07
 12,500.00
Check #801920
1/23/08
 12,500.00
  
12,500.00
 -
                 
 
(1)  Amount approved is based on 80% of Fees and 100% of Expenses
          
FORM MOR-1b
(2) Amount approved is based on 100% of Fees and 100% of Expenses
              
                   
                   
 
 
Page 5 of 9
 
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
STATEMENT OF OPERATIONS
  
(Income Statement)
  
             
The Statement of Operations is to be prepared on an accrual basis. The accrual basis of accounting recognized revenue when it is realized and expenses when they are incurred, regardless of when cash is actually received or paid.
  
             
   
1/1 - 1/31
    
Cumulative
Filing to Date
  
             
             
Revenue
   $ -     $ 29,703,635  
Cost of Goods Sold
     -       20,913,642  
Gross Profit
     -       8,789,993  
                 
Controllable Expenses
     -       8,143,441  
Non-Controllable Expenses
     -       4,014,958  
Total Operating Expenses
     -       12,158,399  
Operating Income
     -       (3,368,406 )
Other Income / Expense
     (257,110 )      (3,997,059 ) 
Loss on Transaction
     -       (32,813,636 )
Earnings before Tax
     (257,110 )     (40,179,101 )
Taxes
     -       -  
Net Income
   $ (257,110 )   $ (40,179,101 )
                 
                 
* "Insider" is defined in 11 U.S.C. Section 101(31).
                
           
FORM MOR-2
  
 
 
Note
The Debtors keep consolidated books and records. To provide Statement of Operations by Debtor would be unduly burdensome and time consuming.
 
 
Page 6 of 9
 
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
BALANCE SHEET  
   
The Balance Sheet is to be completed on an accrual basis only. Pre-petition liabilities must be classified separately from postpetition obligations.
  
 
       
BALANCE SHEET
  
31-Jan-08
  
       
Current assets
      
Cash and cash equivalents
   $ 3,801,199  
Accounts receivable
     -  
Inventory
     -  
Deferred tax assets
     -  
Prepaid expenses and other current assets
     381,425  
Total current assets
     4,182,624  
         
Property and equipment
     -  
Long term investments
     -  
Intangible assets - net
     -  
Other assets
     -  
Goodwill
     -  
Total Assets
   $ 4,182,624  
         
Liabilities not Subject to Compromise (Postpetition)
        
Current portion of long-term debt
   $ -  
Escrow
     600,000  
Total Accounts Payable
     2,732,065  
Total Postpetition Liabilities
     3,332,065  
         
Liabilities Subject to Compromise (Pre-Petition)
        
         
Deferred Consideration
     -  
Accrued Expenses
     -  
Customer Deposits
     -  
Pre-petition A/P
     32,536,235  
Total Pre-Petition Liabilities
     32,536,235  
         
Secured Bank Debt
     -  
         
Other long-term liabilities
        
Accrued income taxes
     951,185  
LT restructuring & discontinued store reserve
     -  
Rent Related Accruals
     -  
   Total other long-term liabilities
     951,185  
   Total liabilities
     36,819,484  
         
Total Stockholder's Equity
     (32,636,860 )
Total liabilities and stockholder's equity
   $ 4,182,624  
         
         
         
Note
The Debtors keep consolidated books and records. To provide Balance Sheet by Debtor would be unduly burdensome and time consuming.
 
 
Page 7 of 9
 
 
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
STATUS OF POSTPETITION TAXES
The beginning tax liability should be the ending liability from the prior month or, if this is the first report, the amount should be zero.
Attach photocopies of IRS Form 6123 or payment receipt to verify payment or deposit of federal payroll taxes.
Attach photocopies of any tax returns filed during the reporting period.
                 
 
FEDERAL
  
Tax
Liability
    
Amount
Withheld or
Accrued
    
Amount
Paid
    
Tax
Liability
    
                           
Withholding
     -       -       -       -    
FICA-Employee
     -       -       -       -    
FICA-Employer
     -       -       -       -    
Unemployment
     -       -       -       -    
Income
     -       -       -       -    
Other
     -       -       -       -    
Total Federal Taxes
     -       -       -       -    
State and Local
                                  
Withholding
     -       -       -       -    
Sales
     -       -       -       -    
Excise
     -       -       -       -    
Unemployment
     -       -       -       -    
Real Property
     -       -       -       -    
Personal Property
     -       -       -       -    
Other
     -       -       -       -    
Total State and Local
     -       -       -       -    
Total Taxes
     -       -       -       -    
                                   
                                   
                                   
SUMMARY OF UNPAID POSTPETITION DEBTS
                                   
Attach aged listing of accounts payable
                                  
                                   
Accounts Payable Aging
    
0-30
      
31-60
      
61-90
    
Over 90
  
Total
Total Accounts Payable
   $ (2,732,065 )   $ -     $ -     $ -  
 $   (2,732,065)
                                   
Explain how and when the Debtor intends to pay any post-due postpetition debts.
                    
* "Insider" is defined in 11 U.S.C. Section 101(31).
                                  
                           
FORM MOR-4
    
 
 
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UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE

   
   
In Re:
Tweeter Home Entertainment Group, Inc., et al.
Debtors
Chapter 11
Case Number: 07-10787 (PJW)
Jointly Administered
Hon. Peter J. Walsh
   
 
 
ACCOUNTS RECEIVABLE RECONCILIATION AND AGING
  
                               
Accounts Receivable Aging
    
0-30
      
31-60
      
61-90
    
Over 90
    
Total
  
Total Accounts Receivable (2)
   $ -       -       -       -       -  
                                         
                                         
                                         
 
DEBTOR QUESTIONNAIRE
               
Must be completed each month
        
Yes
No
1.
Have any assets been sold or transferred outside the normal course of business this reporting period?  If yes, provide explanation below. (2)
 
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 coverage's 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
 
 
 
               
             
FORM MOR-5
 
Notes:
 
Account Receivable as of 7/13/07 was sold to NewCo resulting in no A/R on 1/31/08.
 
 
 
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