EX-99.3 5 ex99-3.txt MONTHLY OPERATING REPORT 12/01 - TESSERACT Exhibit 99.3 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 DECEMBER ) 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: DECEMBER 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 -- 1,269,063.96 -- -- -- -- RECEIPTS STUDENT FEES -- CHARTER SCHOOL REVENUE -- ACCOUNTS RECEIVABLE 19,507.91 INTEREST 723.69 SALE OF ASSETS TRANSFERS IN FROM OTHER ACCOUNTS 19,507.91 -- -- 66,892.00 -- OTHER (ATTACH LIST) TOTAL RECEIPTS 19,507.91 20,231.60 -- -- 66,892.00 -- DISBURSEMENTS BUSINESS - ORDINARY OPERATIONS -- -- -- 33,446.00 -- CAPITAL IMPROVEMENTS PRE-PETITION DEBT TRANSFERS TO OTHER DIP ACCOUNTS 19,507.91 66,892.00 -- PAYMENTS MADE FOR SUNRISE EDU. -- 33,446.00 OTHER (VOIDS) REORGANIZATION EXPENSES: ATTORNEY FEES ACCOUNTANT FEES OTHER PROFESSIONAL FEES U.S. TRUSTEE QUARTERLY FEE COURT COSTS TOTAL DISBURSEMENTS 19,507.91 66,892.00 -- -- 66,892.00 -- ------------ ------------- ----------- ------------ ------------ ------------- ACCOUNT BALANCE - END OF MONTH -- 1,222,403.56 -- -- -- -- ============ ============= =========== ============ ============ ============= 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 -- -- 419,253.61 585,000.00 2,273,317.57 RECEIPTS STUDENT FEES -- CHARTER SCHOOL REVENUE -- ACCOUNTS RECEIVABLE 19,507.91 INTEREST -- 723.69 SALE OF ASSETS -- -- TRANSFERS IN FROM OTHER ACCOUNTS 86,399.91 OTHER (ATTACH LIST) -- TOTAL RECEIPTS -- -- -- -- 106,631.51 DISBURSEMENTS BUSINESS - ORDINARY OPERATIONS 33,446.00 CAPITAL IMPROVEMENTS -- PRE-PETITION DEBT -- TRANSFERS TO OTHER DIP ACCOUNTS -- 86,399.91 PAYMENTS MADE FOR SUNRISE EDU 33,446.00 OTHER (VOIDS) -- REORGANIZATION EXPENSES: ATTORNEY FEES -- ACCOUNTANT FEES -- OTHER PROFESSIONAL FEES -- U.S. TRUSTEE QUARTERLY FEE -- COURT COSTS -- TOTAL DISBURSEMENTS -- -- -- -- 153,291.17 ------------ ------------- ------------- ------------- ------------- ACCOUNT BALANCE - END OF MONTH -- -- 419,253.61 585,000.00 2,226,657.17 ============ ============= ============= ============= ============= THE FOLLOWING SECTION MUST BE FILLED OUT DISBURSEMENTS FOR CALCULATING QUARTERLY FEES: TOTAL DISBURSEMENTS FROM ABOVE 153,291.91 LESS: TRANSFERS OUT TO OTHER DIP ACCOUNTS (86,399.91) LESS: PAYMENTS MADE FOR SUNRISE EDUCATIONAL SERVICES, INC. (33,446.00) PLUS: ESTATE DISBURSEMENTS MADE BY OUTSIDE SOURCES (i.e. PAYMENTS FROM ESCROW OR 2-PARTY CHECKS) ---------------- TOTAL DISBURSEMENTS FOR CALCULATING QUARTERLY FEES: 33,446.00 ================
2 THE TESSERACT GROUP (EXCL. SUNRISE) STATEMENT OF OPERATIONS FOR THE MONTH ENDING DECEMBER 31, 2001 REVENUE Tuition and Fees Revenue $ -- Refunds/Returns -- Discounts -- ------------ Total Revenue -- ------------ OPERATIONAL COSTS Salaries and Wages -- Taxes and Benefits -- Food Programs Expense -- Maintenance Expense -- Insurance Expense -- Rent Expense -- Utilities Expense -- ------------ Total Operational Costs -- ------------ GENERAL & ADMINISTRATIVE COSTS Bank Charges/Processing Fees-A -- Corporate Overhead 18,355.11 Corporate Overhead Allocated to Sunrise (9,178.00) Other Expenses -- ------------ Total General and Administrative Expenses 9,177.11 ------------ Other Income 13,962.68 Interest Expense -- ------------ Net Interest and Other Income (Expense) 13,962.68 ------------ Reorganization Expenses Professional Fees 45,203.71 Professional Fees Allocated to Sunrise (22,602.00) ------------ Total Reorganization Expenses 22,601.71 ------------ Net Income $ (17,816.14) ============ 3 THE TESSERACT GROUP (EXCL. SUNRISE) BALANCE SHEET DECEMBER 31, 2001 ASSETS Current Assets Cash and Cash Equivalents $ 2,058,959.41 Accounts Receivable, net 5,841.67 Note Receivable from Nobel -- Prepaid Rent 6,400.00 Other Prepaid Expenses -- --------------- Total Current Assets 2,071,201.08 Investment in Sunrise 18,971,824.26 Property and Equipment, net -- Deposits and Other Assets 1,512,992.80 --------------- Total Assets $ 22,556,018.14 =============== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts Payable $ 11,162.88 Accrued Payroll and Benefits 998,366.69 Accrued Payroll Taxes -- Deferred Revenue and Tuition Deposits 885,140.74 --------------- Total Current Liabilities 1,894,670.31 --------------- Pre-Petition Liabilities Line of Credit 5,848,822.65 Accounts Payable 4,000,053.05 Other Unsecured Notes Payable 865,500.00 Other Current Liabilities 4,688,067.54 Long-Term Debt 1,696,967.85 --------------- Total Pre-Petition Liabilities 17,099,411.09 --------------- Due to Sunrise 2,803,860.23 Reserve for Closed Schools 504,099.10 Other Long-Term Obligations 13,999.76 --------------- Total Long-Term Liabilities 3,321,959.09 --------------- Total Liabilities 22,316,040.49 --------------- Shareholders' Equity Pre-Petition Shareholders' Equity 5,334,668.03 Post Petition Retained Deficit (5,094,690.38) --------------- Total Shareholders' Equity 239,977.65 --------------- Total Liabilities and Shareholders' Equity $ 22,556,018.14 =============== 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 11,163 (2,249) -- -- 13,412 TAXES PAYABLE -- -- ACCRUED SALARIES AND BENEFITS 998,367 998,367 PREPAID TUITION AND DEPOSITS 885,141 885,141 SECURED DEBT OTHER (ATTACH LIST) --------- --------- ----- ----- ------ TOTAL POST-PETITION LIABILITIES 1,894,670 1,881,258 -- -- 13,412 ========= ========= ===== ===== ====== 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 14,089.41 223,843.98 Gary Lilyquist Wages and Exp. Reimbursement -- 80,239.99 ---------- ---------- TOTAL PAYMENTS TO INSIDERS 14,089.41 455,218.76 ========== ========== PROFESSIONALS
DATE OF COURT TOTAL ORDER AUTHORIZING AMOUNT AMOUNT TOTAL PAID INCURRED NAME PAYMENT APPROVED PAID TO DATE & UNPAID ---- ------- -------- ---- ------- -------- Bryan Cave 15,348.42 15,348.42 302,581.14 Engleman & Berger, PC 17,553.28 17,553.28 125,515.79 Field, Sarvas, King & Coleman 7,853.48 Mariscal, Weeks, McIntyre 8,252.01 8,252.01 18,619.26
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: 0 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. CASH FLOW ANALYSIS B-00-10938-ECF-RTB BEGINNING FUNDS AVAILABLE: $ (224,982.66) ------------- Cash In: Credit Card Deposit (Private) -- Credit Card Deposit (Charter) -- Regular Deposits (Private) -- Regular Deposits (Charter) -- Regular Deposits (Corporate) 19,507.91 Interest 723.69 ------------- Daily Cash In: $ 20,231.60 ============= Cash Out: Charter A/P -- Private A/P -- Corporate A/P 66,892.00 Corporate A/P (allocated to Sunrise) (33,446.00) TesseracT Payroll -- Charter Payroll -- Medical Claims -- Banking Fees -- LTC Payment -- Voids -- ------------- Daily Cash Out: $ 33,446.00 ============= ------------- Net Cash In/Out: $ (13,214.40) ------------- ENDING FUNDS AVAILABLE: $ (238,197.06) ============= 8 THE TESSERACT GROUP, INC. CONSOLIDATED CASH FLOW ANALYSIS TOTAL FOR DECEMBER 2001 BEGINNING FUNDS AVAILABLE: $ 2,273,317.57 ---------------- Cash In: Telecheck $ -- Credit Card Deposit (Preschools) -- Credit Card Deposit (Private) -- Credit Card Deposit (Charter) -- Regular Deposits (Preschools) -- Regular Deposits (Private) -- Regular Deposits (Charter) -- Regular Deposits (Corporate) 19,507.91 Other Deposit (Preschool) -- Interest 723.69 Interest on LTC Acct -- Voids -- ---------------- Daily Cash In: $ 20,231.60 ================ Cash Out: Preschool A/P $ -- Charter A/P -- Private A/P -- Corporate A/P 66,892.00 TesseracT Payroll -- Preschool Payroll -- Charter Payroll -- College PR -- Preschool NSF -- Medical Claims -- Banking Fees -- LTC Payment -- LTC Fees -- ---------------- Daily Cash Out: $ 66,892.00 ================ Net Cash In/Out: $ (46,660.40) ---------------- ENDING FUNDS AVAILABLE: $ 2,226,657.17 ================ 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 ------------ --------- ----------------- ---------- ------------ ---------- ------ 200013085 MOOBRI000-B MOORE, BRIAN 10/10/2001 OPERATING2 PMCHK00000338 $856.80 200013153 ATTGENAZ000-B ATTORNEY GENERAL OFFICE-AZ 12/5/2001 OPERATING2 PMCHK00000352 $674.88 200013154 KUTROC000-B KUTAK ROCK 12/5/2001 OPERATING2 PMCHK00000352 $35.00 200013155 LYN000000-B LYNCH,MICHAEL 12/5/2001 OPERATING2 PMCHK00000352 $128.07 200013156 QWEST000-B QWEST 12/5/2001 OPERATING2 PMCHK00000352 $105.42 200013157 RECCON000-B RECEIVABLES CONTROL COPR 12/5/2001 OPERATING2 PMCHK00000352 $916.96 200013158 ADP, INC000-B ADP INC 12/6/2001 OPERATING2 PMCHK00000353 $2,084.80 200013159 BEM000000-B BEMISH,KAREN 12/6/2001 OPERATING2 PMCHK00000353 $19.33 200013160 CTCORP-AZ000-B CT CORPORATION-AZ 12/6/2001 OPERATING2 PMCHK00000353 $552.49 200013161 IMPFIN000-B IMPERIAL FINANCIAL PRINTING 12/6/2001 OPERATING2 PMCHK00000353 $245.00 200013162 BEMJOH000-B JOHN BEMISH 12/7/2001 OPERATING2 PMCHK00000354 $300.00 200013163 LYN000000-B LYNCH,MICHAEL 12/7/2001 OPERATING2 PMCHK00000354 $3,413.30 200013164 RIVJUD000-B JUDI RIVERA 12/7/2001 OPERATING2 PMCHK00000354 $460.00 --------- Total Checks: 12 Total Amount of Checks: $8,935.25 =========
10 THE TESSERACT GROUP MANUAL CHECKS FOR THE MONTH ENDED DECEMBER 31, 2001 DECEMBER CHECK # PAYEE DATE AMOUNT ------- ----- ---- ------ 200013152 Jim Bonfiglio 12/3/2001 $ 4,050.00 200013165 Mike Lynch 12/10/2001 $ 308.14 200013166 AA American Development Corp. 12/10/2001 $ 1,625.00 200013167 Judith Rivera 12/12/2001 $ 580.00 200013168 Mike Lynch 12/13/2001 $ 3,413.30 200013170 Bryan Cave LLP 12/13/2001 $15,348.42 200013175 Mariscal Weeks McINtyre & Friedlander 12/13/2001 $ 8,252.01 200013176 Engleman Berger 12/13/2001 $17,553.28 200013169 Mike Lynch 12/29/2001 $ 6,826.60 ---------- $57,956.75 ========== 11