EX-99.1 3 ex99-1.txt TESSERACT AUGUST 2001 OPERATING REPORT Exhibit 99.1 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF ARIZONA In re: ) CASE NO. B-00-10938-ECF-RTB ) THE TESSERACT GROUP, INC. ) BUSINESS AND INDUSTRY ) MONTHLY OPERATING REPORT ) ) MONTH OF AUGUST ) Debtor(s) ) DATE PETITION FILED: October 6, 2000 ) ) TAX PAYER ID NO. 4101581297 Nature of Debtor's Business: For Profit Educational Services DATE DISCLOSURE STATEMENT: FILED Not Yet Filed TO BE FILED To Be Determined ------------- ---------------- DATE PLAN OF REORGANIZATION: FILED Not Yet Filed TO BE FILED To Be Determined ------------- ---------------- I CERTIFY UNDER PENALTY OF PERJURY THAT THE FOLLOWING MONTHLY OPERATING REPORT AND THE ACCOMPANYING ATTACHMENTS ARE TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE. RESPONSIBLE PARTY: CEO ---------------------------------------- ---------- ORIGINAL SIGNATURE OF RESPONSIBLE PARTY TITLE Michael Lynch ---------------------------------------- ---------- PRINTED NAME OF RESPONSIBLE PARTY DATE PREPARER: Controller ---------------------------------------- ---------- ORIGINAL SIGNATURE OF PREPARER TITLE Douglass E. Snell ---------------------------------------- ---------- PRINTED NAME OF PREPARER DATE PERSON TO CONTACT REGARDING THIS REPORT: Douglass E. Snell --------------------------------------- PHONE NUMBER: 602-300-6257 --------------------------------------- ADDRESS: 1777 W. Camelback Rd., J109 Phoenix, AZ 85015 --------------------------------------- ORIGINAL OF REPORT IS FILED WITH THE COURT, COPY IS FILED WITH U.S. TRUSTEE'S OFFICE THE TESSERACT GROUP, INC. B-00-10938-ECF-RTB MONTH: AUGUST 2001 RECEIPTS AND DISBURSEMENTS
BANK ACCOUNTS ----------------------------------------------------------------------------------------------- Amounts reported should be NATIONAL GROUP GROUP GROUP TESSERACT GROUP TESSERACT per the debtor's books, DEPOSITORY DEPOSITORY MEDICAL PAYROLL OPERATING CHARTER not per the bank statement #944-010-7759 #022-922-6741 #022-922-6576 #022-922-6576 #022-978-8101 #022-922-6808 ------------- ------------- ------------- ------------- ------------- ------------- ACCOUNT BALANCE - BEGINNING OF MONTH -- 2,818,770.34 -- -- -- 6,459.76 RECEIPTS STUDENT FEES 316,651.52 327.00 CHARTER SCHOOL REVENUE -- ACCOUNTS RECEIVABLE -- INTEREST 808.21 SALE OF ASSETS TRANSFERS IN FROM OTHER ACCOUNTS 316,651.52 -- 422,933.06 248,565.50 -- OTHER (ATTACH LIST) TOTAL RECEIPTS 316,651.52 317,786.73 -- 422,933.06 248,565.50 -- DISBURSEMENTS BUSINESS - ORDINARY OPERATIONS -- 12,843.82 -- 86,760.31 133,433.69 6,351.75 CAPITAL IMPROVEMENTS PRE-PETITION DEBT TRANSFERS TO OTHER DIP ACCOUNTS 316,651.52 1,256,558.56 -- PAYMENTS MADE FOR SUNRISE EDU. 326,632.67 336,232.75 115,131.81 OTHER (VOIDS) REORGANIZATION EXPENSES: ATTORNEY FEES ACCOUNTANT FEES OTHER PROFESSIONAL FEES U.S. TRUSTEE QUARTERLY FEE COURT COSTS TOTAL DISBURSEMENTS 316,651.52 1,596,035.05 -- 422,993.06 248,565.50 6,351.75 ------------ ------------- ----------- ------------ ------------ ------------- ACCOUNT BALANCE - END OF MONTH -- 1,540,522.02 -- -- -- 108.01 ============ ============= =========== ============ ============ ============= BANK ACCOUNTS ------------------------------------------------------------------------------------- Amounts reported should be CHARTER FIRST FEDERAL CREDITOR per the debtor's books, EXTRACURRICULAR CREDIT UNION RESERVE NE CAPITAL not per the bank statement #022-922-7442 #4002-0270-922 #052-980-2118 RESERVE TOTAL ------------- -------------- ------------- ---------------- ---------------- ACCOUNT BALANCE - BEGINNING OF MONTH -- -- 417,731.01 -- 3,242,961.11 RECEIPTS STUDENT FEES 316,978.52 CHARTER SCHOOL REVENUE -- ACCOUNTS RECEIVABLE -- INTEREST 493.44 1,301.65 SALE OF ASSETS -- -- TRANSFERS IN FROM OTHER ACCOUNTS 585,000.00 1,573,210.08 OTHER (ATTACH LIST) -- TOTAL RECEIPTS -- -- 493.44 585,000.00 1,891,490.25 DISBURSEMENTS BUSINESS - ORDINARY OPERATIONS 239,389.57 CAPITAL IMPROVEMENTS -- PRE-PETITION DEBT -- TRANSFERS TO OTHER DIP ACCOUNTS -- 1,573,210.08 PAYMENTS MADE FOR SUNRISE EDU 777,997.23 OTHER (VOIDS) -- REORGANIZATION EXPENSES: ATTORNEY FEES -- ACCOUNTANT FEES -- OTHER PROFESSIONAL FEES -- U.S. TRUSTEE QUARTERLY FEE -- COURT COSTS -- TOTAL DISBURSEMENTS -- -- -- -- 2,590,596.88 ------------ ------------- ------------- ------------- ------------- ACCOUNT BALANCE - END OF MONTH -- -- 418,224.45 585,000.00 2,543,854.48 ============ ============= ============= ============= ============= THE FOLLOWING SECTION MUST BE FILLED OUT DISBURSEMENTS FOR CALCULATING QUARTERLY FEES: TOTAL DISBURSEMENTS FROM ABOVE 2,590,596.88 LESS: TRANSFERS OUT TO OTHER DIP ACCOUNTS (1,573,210.08) LESS: PAYMENTS MADE FOR SUNRISE EDUCATIONAL SERVICES, INC. (777,997.23) PLUS: ESTATE DISBURSEMENTS MADE BY OUTSIDE SOURCES (i.e. PAYMENTS FROM ESCROW OR 2-PARTY CHECKS) ---------------- TOTAL DISBURSEMENTS FOR CALCULATING QUARTERLY FEES: 239,389.57 ================
2 THE TESSERACT GROUP (EXCL. SUNRISE) STATEMENT OF OPERATIONS FOR THE MONTH ENDING AUGUST 31, 2001 REVENUE Tuition and Fees Revenue $ -- Refunds/Returns (1,908.12) Discounts -- ------------ Total Revenue (1,908.12) ------------ OPERATIONAL COSTS Salaries and Wages 21,076.76 Taxes and Benefits 5,639.08 Food Programs Expense 5,602.84 Maintenance Expense 17,585.80 Insurance Expense 2,929.77 Rent Expense 2,982.70 Utilities Expense -- ------------ Total Operational Costs 55,816.95 ------------ GENERAL & ADMINISTRATIVE COSTS Bank Charges/Processing Fees-A 112.60 Corporate Overhead 92,772.09 Corporate Overhead Allocated to Sunrise (46,386.00) Other Expenses -- ------------ Total General and Administrative Expenses 46,498.69 ------------ Other Income 14,552.19 Interest Expense (82,993.30) ------------ Net Interest and Other Income (Expense) (68,441.11) ------------ Reorganization Expenses Professional Fees 103,694.63 Professional Fees Allocated to Sunrise (51,847.00) ------------ Total Reorganization Expenses 51,847.63 ------------ Net Income $(224,512.50) ============ 3 THE TESSERACT GROUP (EXCL. SUNRISE) BALANCE SHEET AUGUST 31, 2001 ASSETS Current Assets Cash and Cash Equivalents $ 2,277,711.48 Accounts Receivable, net 1,841.67 Note Receivable from Nobel -- Prepaid Rent 6,400.00 Other Prepaid Expenses -- -------------- Total Current Assets 2,285,953.15 Investment in Sunrise 18,971,824.26 Property and Equipment, net -- Deposits and Other Assets 1,512,992.80 -------------- Total Assets $22,770,770.21 ============== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts Payable $ 11,648.49 Accrued Payroll and Benefits 1,029,600.08 Accrued Payroll Taxes -- Deferred Revenue and Tuition Deposits 885,140.74 -------------- Total Current Liabilities 1,926,389.31 -------------- Pre-Petition Liabilities Line of Credit 5,848,822.65 Accounts Payable 3,989,797.38 Other Unsecured Notes Payable 865,500.00 Other Current Liabilities 4,540,257.35 Long-Term Debt 1,696,967.85 -------------- Total Pre-Petition Liabilities 16,941,345.23 -------------- Due to Sunrise 3,076,509.41 Reserve for Closed Schools 504,099.10 Other Long-Term Obligations 13,999.76 -------------- Total Long-Term Liabilities 3,594,608.27 -------------- Total Liabilities 22,462,342.81 -------------- Shareholders' Equity Pre-Petition Shareholders' Equity 5,335,805.21 Post Petition Retained Deficit (5,027,377.81) -------------- Total Shareholders' Equity 308,427.40 -------------- Total Liabilities and Shareholders' Equity $22,770,770.21 ============== 4 CASE NUMBER: B-00-10938-ECF-RTB STATUS OF ASSETS 0-30 31-60 60+ ACCOUNTS RECEIVABLE TOTAL DAYS DAYS DAYS ------------------- ----- ---- ---- ---- TOTAL ACCOUNTS RECEIVABLE 1,842 1,842 -- -- LESS: AMOUNT CONSIDERED UNCOLLECTIBLE -- -- ACCOUNTS RECEIVABLE (NET) 1,842 1,842 -- -- SCHEDULED CURRENT FIXED ASSETS AMOUNT ADDITIONS DELETIONS AMOUNT ------------ --------- --------- --------- ------ REAL PROPERTY 1,867,408 1,867,408 (0) BUILDING IMPROVEMENTS/PLANT 846,395 16,066 862,461 (0) ACCUMULATED DEPRECIATION (136,823) (33,112) (169,935) 0 NET BUILDINGS/PLANT 709,573 (17,047) 692,526 (0) EQUIPMENT 5,466,149 11,637 5,477,786 (0) ACCUMULATED DEPRECIATION (2,404,930) (533,426) (2,938,357) 0 NET EQUIPMENT 3,061,218 (521,789) 2,539,429 (0) AUTOS & VEHICLES 557,586 557,586 -- ACCUMULATED DEPRECIATION (259,791) (65,272) (325,063) 0 NET AUTOS & VEHICLES 297,795 (65,272) 232,523 0 NOTE: Reduction in assets due to sale of Private and Charter School assets. 5 CASE NUMBER: B-00-10938-ECF-RTB STATUS OF LIABILITIES AND SENSITIVE PAYMENTS POSTPETITION UNPAID OBLIGATIONS TOTAL 0-30 31-60 61-90 91+ ------------------ --------- --------- ----- ----- ------ ACCOUNTS PAYABLE 11,648 (2,286) -- -- 13,935 TAXES PAYABLE 5,348 5,348 ACCRUED SALARIES AND BENEFITS 1,029,600 1,029,600 PREPAID TUITION AND DEPOSITS 885,141 885,141 SECURED DEBT OTHER (ATTACH LIST) --------- --------- ----- ----- ------ TOTAL POST-PETITION LIABILITIES 1,931,737 1,917,802 -- -- 13,935 ========= ========= ===== ===== ====== PAYMENTS TO INSIDERS AND PROFESSIONALS INSIDERS AMOUNT PD TOTAL PD NAME REASON FOR PAYMENT THIS MONTH TO DATE ---- ------------------ ---------- ---------- Lucian Spataro Wages and Exp. Reimbursement -- 129,134.79 Ernie Recsetar Wages -- 22,000.00 Michael Lynch Wages and Exp. Reimbursement 15,770.60 169,434.08 Gary Lilyquist Wages and Exp. Reimbursement -- 80,239.99 --------- ---------- TOTAL PAYMENTS TO INSIDERS 15,770.60 400,808.86 ========= ========== PROFESSIONALS
DATE OF COURT TOTAL ORDER AUTHORIZING AMOUNT AMOUNT TOTAL PAID INCURRED NAME PAYMENT APPROVED PAID TO DATE & UNPAID ---- ------- -------- ---- ------- -------- Bryan Cave 59,807.61 59,807.61 226,784.47 Engleman & Berger, PC 5,792.20 5,792.20 87,882.08
6 CASE NUMBER: B-00-10938-ECF-RTB CASE STATUS QUESTIONNAIRE YES NO --- -- HAVE ANY FUNDS BEEN DISBURSED FROM ANY ACCOUNT OTHER THAN A DEBTOR IN POSSESSION ACCOUNT? NO ARE ANY POSTPETITION RECEIVABLES (ACCOUNTS, NOTES, OR LOANS) DUE FROM RELATED PARTIES? NO ARE ANY WAGE PAYMENTS PAST DUE? NO ARE ANY U.S. TRUSTEE QUARTERLY FEES DELINQUENT? NO CURRENT NUMBER OF EMPLOYEES: 6 INSURANCE CARRIER AND PERIOD EXPIRATION PAYMENT AMOUNT TYPE OF POLICY POLICY NUMBER COVERED DATE & FREQUENCY -------------- ------------- ------- ---- ----------- WHAT STEPS HAVE BEEN TAKEN TO REMEDY ANY OF THE PROBLEMS THAT BROUGHT ABOUT THE CHAPTER 11 FILING? LIST ANY MATTERS THAT ARE DELAYING THE FILING OF A PLAN OF REORGANIZATION? 7 THE TESSERACT GROUP, INC. CONSOLIDATED CASH FLOW ANALYSIS TOTAL FOR AUGUST 2001 ------------- BEGINNING FUNDS AVAILABLE: $3,242,961.11 ------------- Cash In: Telecheck $ 327.00 Credit Card Deposit (Preschools) 12,201.30 Credit Card Deposit (Private) -- Credit Card Deposit (Charter) -- Regular Deposits (Preschools) 287,342.15 Regular Deposits (Private) 520.30 Regular Deposits (Charter) 1,461.38 Regular Deposits (Corporate) 18,269.07 Other Deposit (Preschool) -- Interest 1,301.65 Interest on LTC Acct -- Voids -- ------------- Daily Cash In: $ 321,422.85 ============= Cash Out: Preschool A/P $ 326,632.67 Charter A/P 6,351.75 Private A/P 18,301.87 Corporate A/P 230,263.63 TesseracT Payroll 72,287.03 Preschool Payroll 336,232.75 Charter Payroll 14,473.28 College PR -- Preschool NSF 3,142.68 Medical Claims -- Banking Fees 12,843.82 LTC Payment -- LTC Fees -- ------------- Daily Cash Out: $1,020,529.48 ============= Net Cash In/Out: $ (699,106.63) ------------- ENDING FUNDS AVAILABLE: $2,543,854.48 ============= 8 THE TESSERACT GROUP, INC. CASH FLOW ANALYSIS B-00-10938-ECF-RTB BEGINNING FUNDS AVAILABLE: $ 42,311.06 -------------- Cash In: Credit Card Deposit (Private) -- Credit Card Deposit (Charter) -- Regular Deposits (Private) 520.30 Regular Deposits (Charter) 1,461.38 Regular Deposits (Corporate) 18,269.07 Interest 1,301.65 -------------- Daily Cash In: $ 21,552.40 ============== Cash Out: Charter A/P 6,351.75 Private A/P 18,301.87 Corporate A/P 230,263.63 Corporate A/P (allocated to Sunrise) (115,131.82) TesseracT Payroll 72,287.03 Charter Payroll 14,473.28 Medical Claims -- Banking Fees 12,843.82 LTC Payment -- Voids -- -------------- Daily Cash Out: $ 239,389.56 ============== Net Cash In/Out: $ (217,837.16) -------------- ENDING FUNDS AVAILABLE: $ (175,526.10) ============== 9 CORPORATE COMPANY VENDOR CHECK REGISTER REPORT PAYABLES MANAGEMENT * Voided Checks
AUDIT CHECK NUMBER VENDOR ID VENDOR CHECK NAME CHECK DATE CHECKBOOK ID TRAIL CODE AMOUNT ------------ --------- ----------------- ---------- ------------ ---------- ------ 200012990 CAVBRY000-B BRYAN CAVE LLP 8/1/2001 OPERATING2 PMCHK00000298 $59,807.61 200012991 CT0COR000-B CT CORPORATION SYSTEM 8/3/2001 OPERATING2 PMCHK00000299 $530.00 200012992 FEDEXP000-B FEDERAL EXPRESS 8/3/2001 OPERATING2 PMCHK00000299 $122.72 200012993 SNELDO000-B DOUG SNELL 8/3/2001 OPERATING2 PMCHK00000299 $1,031.20 200012994 THEHAR000-B THE HARTFORD 8/3/2001 OPERATING2 PMCHK00000299 $7,753.16 200012995 WELFAR003-B WELLS FARGO (MN) 8/3/2001 OPERATING2 PMCHK00000299 $731.29 200012996 RIVJUD000-B JUDI RIVERA 8/6/2001 OPERATING2 PMCHK00000300 $400.00 200012997 CIGNA000-B CIGNA 8/6/2001 OPERATING2 PMCHK00000301 $2,636.46 200012998 CONGEN000-B CONNECTICUT GENERAL LIFE 8/6/2001 OPERATING2 PMCHK00000301 $43,737.70 200012999 CONGENLIF-B CONNECTICUT GENERAL LIFE-DENT 8/6/2001 OPERATING2 PMCHK00000301 $1,001.43 200013000 MAN FIN000-B MANULIFE FINANCIAL 8/6/2001 OPERATING2 PMCHK00000301 $3,323.22 200013001 BONJAM000-B JAMES BONFIGLIO 8/7/2001 OPERATING2 PMCHK00000302 $2,925.00 200013002 FEDEXP000-B FEDERAL EXPRESS 8/7/2001 OPERATING2 PMCHK00000302 $367.80 200013003 LYN000000-B LYNCH,MICHAEL 8/7/2001 OPERATING2 PMCHK00000302 $291.25 200013004 CHAKRI000-B KRISTIE CHAN 8/8/2001 OPERATING2 PMCHK00000303 $160.00 200013005 KUTROC000-B KUTAK ROCK 8/9/2001 OPERATING2 PMCHK00000304 $197.50 200013006 MAN FIN000-B MANULIFE FINANCIAL 8/9/2001 OPERATING2 PMCHK00000304 $1,137.18 200013007 TAHINC000-B TAHER, INC 8/9/2001 OPERATING2 PMCHK00000304 $5,602.84 200013008 ST.GEO000-B ST. GEORGE FELLOWSHIP HALL 8/13/2001 OPERATING2 PMCHK00000305 $2,982.70 200013009 ARC000000-B ARC 8/14/2001 OPERATING2 PMCHK00000306 $67.68 200013010 FENJAN000-B JANE FENNELLY 8/14/2001 OPERATING2 PMCHK00000306 $656.89 200013011 ENGBER000-B ENGELMAN BERGER,P.C. 8/16/2001 OPERATING2 PMCHK00000307 $5,792.20 200013012 MARWEE000-B MARISCAL,WEEKS,MCINTYRE 8/16/2001 OPERATING2 PMCHK00000307 $29,532.32 200013013 FEDEXP000-B FEDERAL EXPRESS 8/21/2001 OPERATING2 PMCHK00000308 $269.30 200013014 IMPFIN000-B IMPERIAL FINANCIAL PRINTING 8/21/2001 OPERATING2 PMCHK00000308 $564.00 200013015 SPEINC000-B SPECTERA, INC. 8/21/2001 OPERATING2 PMCHK00000308 $908.30 200013016 IMPFIN000-B IMPERIAL FINANCIAL PRINTING 8/22/2001 OPERATING2 PMCHK00000309 $190.00 200013017 MAN FIN000-B MANULIFE FINANCIAL 8/22/2001 OPERATING2 PMCHK00000309 $1,137.18 200013018 LYN000000-B LYNCH,MICHAEL 8/22/2001 OPERATING2 PMCHK00000310 $970.64 200013019 KP0LIM000-B KP LIMITED INC 8/22/2001 OPERATING2 PMCHK00000311 $4,112.33 200013020 KP0LIM000-B KP LIMITED INC 8/22/2001 OPERATING2 PMCHK00000311 $4,801.00 200013021 KP0LIM000-B KP LIMITED INC 8/22/2001 OPERATING2 PMCHK00000311 $4,168.37 200013022 KP0LIM000-B KP LIMITED INC 8/22/2001 OPERATING2 PMCHK00000311 $2,922.35 200013023 CIGEMP000-B CIGNA EMPLOYEE BENE-PPO 8/24/2001 OPERATING2 PMCHK00000312 $2,306.90 200013024 CONGEN000-B CONNECTICUT GENERAL LIFE 8/24/2001 OPERATING2 PMCHK00000312 $39,078.48 200013025 CONGENLIF-B CONNECTICUT GENERAL LIFE-DENT 8/24/2001 OPERATING2 PMCHK00000312 $2,877.08 200013026 AA AMRDEV000-B AA AMERICNA DEVELOPMENT CORP 8/27/2001 OPERATING2 PMCHK00000313 $6,400.00 200013027 FEDEXP000-B FEDERAL EXPRESS 8/27/2001 OPERATING2 PMCHK00000313 $84.71 200013028 KUTROC000-B KUTAK ROCK 8/27/2001 OPERATING2 PMCHK00000313 $440.00 200013029 RIVJUD000-B JUDI RIVERA 8/27/2001 OPERATING2 PMCHK00000313 $350.00 200013030 ARC000000-B ARC 8/28/2001 OPERATING2 PMCHK00000314 $4,020.38 200013031 FEDEXP000-B FEDERAL EXPRESS 8/28/2001 OPERATING2 PMCHK00000314 $49.66 200013032 FEDEXP000-B FEDERAL EXPRESS 8/28/2001 OPERATING2 PMCHK00000314 $47.32 200013033 WELFAR003-B WELLS FARGO (MN) 8/28/2001 OPERATING2 PMCHK00000314 $741.90 200013034 LYN000000-B LYNCH,MICHAEL 8/28/2001 OPERATING2 PMCHK00000315 $347.17 200013035 LYN000000-B LYNCH,MICHAEL 8/30/2001 OPERATING2 PMCHK00000316 $700.00 200013037 NOPOOO000-B MIKE NOPPENBERG 8/31/2001 OPERATING2 PMCHK00000318 $290.28 REMIT000000000000109 EDUCOR000-B EDUCORP PROPERTIES, INC 8/16/2001 PMCHK00000307 $0.00 REMIT000000000000110 EDUINV000-B EDUCATION PROPERTY INVESTORS 8/16/2001 PMCHK00000307 $0.00 REMIT000000000000111 SILGOL000-B SILVER GOLUB & TEITELL 8/16/2001 PMCHK00000307 $0.00 ----------- Total Checks: 50 Total Amount of Checks: $248,565.50 ===========
10 OWNED CHARTERS VENDOR CHECK REGISTER REPORT PAYABLES MANAGEMENT * Voided Checks
AUDIT CHECK NUMBER VENDOR ID VENDOR CHECK NAME CHECK DATE CHECKBOOK ID TRAIL CODE AMOUNT ------------ --------- ----------------- ---------- ------------ ---------- ------ 800050526 THEREH000-B THERAPY REHABILITATION SERVICE 8/9/2001 OPERATING PMCHK00000090 $4,770.00 800050527 KP0LIM000-B KP LIMITED INC 8/22/2001 OPERATING PMCHK00000091 $1,581.75 REMIT000000000000002 AT&T78522-B AT&T - 78522 8/9/2001 PMCHK00000090 $0.00 --------- Total Checks: 3 Total Amount of Checks: $6,351.75 =========
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