3. NUMBER OF EMPLOYEES paid during this period: 16
4.
Has there been any CHANGES IN THE NATURE OF YOUR BUSINESS since the last reporting period? YesNo X . If yes, explain below:
5. Are all BUSINESS LICENSES current? YesNo _XNot Applicable
The Company is currently working out a payment plan with the County of Fairfax, Virginia for the renewal of the business license.
6. PRE-PETITION ACCOUNTS RECEIVABLE:
Beginning Balance
$
94,678.31
Collected this Period
$
0.00
Ending Balance
$
94,678.31
7. POST -PETITION ACCOUNTS RECEIVABLE:
0-30 Days:$ 137,867.80 31-60 Days:$ 35,449.26 Over 60 Days:$ 16,163.60
If there arepost-petition accounts receivable over 60 days, provide a schedule giving a listing of such accounts and explain the delinquencies.
Customer Name
Amount
Comment
BBA Fiberweb
$
440.00
Paid May 1, 2006.
Beijing Novog Technology
$
5,779.90
Prompt payment has been requested.
Federal Express
$
5,394.80
Paid May 10, 2006.
Federal Express
$
3,020.00
Paid May 8, 2006.
Hilton Hotel
$
911.00
Customer approved payment of
invoice, payment forthcoming.
MSGI Security
$
94.90
Short payment of invoice,
insufficient funds on credit
card, prompt payment has been
requested.
Oilstop
$
523.00
Paid May 9, 2006.
TOTAL Bal > 60 days
$
16,163.60
8. POST –PETITION ACCOUNTS PAYABLE:
0-30 Days:$ 128,672.16 31-60 Days:$ 0 Over 60 Days:$ 12,097.00
If there are anypost-petition Accounts Payable over 30 days, provide Schedule AP giving a listing of such accounts and explain the delinquencies.
Payee
Amount
Comment
Donlin,Recano & Co
$
5,000.00
$5,000 in negotiation
James Ralabate
7,097.00
Disputed
TOTAL BAL>60 days
$
12,097.00
9.
TAXES. Are all taxes being paid to the proper taxing authorities when due? Yes _XNo. On the attached IRS Form 6123 report all tax deposits made with any financial institution for federal employment taxes. Be sure the form is complete and signed by an authorized employee of the receiving institution or taxing authority. Attach to this report a completed Form 6123 for each deposit made during the reporting period. Also attach copies of the monthly sales tax report, payroll tax report and unemployment tax report with evidence of payment of both federal and state taxes.
NOTE: Due to limited funding, the debtor has not been able to retain a tax accountant for preparation of both the 2004 and 2005 federal and state tax returns. The debtor expects little or no lax liability due to the large net operating loss carryforward and the net losses for both 2004 and 2005.
10.
ESCROW ACCOUNTS. Are you utilizing your tax account only for deposit and payment of payroll and sales taxes? Yes _X_ NoIf no, explain:
11.
Are all BOOKS AND RECORDS of the debtor(s) being maintained monthly and are all current? Yes _X_, NoIf no, explain:
NOTE: Due to lack of review by independent auditors, the Company’s Balance Sheet and Income Statement may require adjustments in the future to conform with generally accepted accounting principles. The Monthly Operating Reports are in a format prescribed by applicable bankruptcy law that is generally consistent, but not in full conformity, with generally accepted accounting principles.
13.ACTIONS OF DEBTOR. During the last month, did the debtor:
(A) Fail to defend or not oppose any action seeking to dispossess the debtor from contro1 or custody of any asset of the estate? YesNo _Xif yes, explain:
(B) Maintain such stock inventory, raw materials, insurance, employees and other resources as are necessary to preserve and maintain the going concern value of the assets of the debtor? Yes _X_ Noif no, explain:
14.
TRANSFER OR SALE OF PROPERTY. Did the debtor or any person with control over any of the debtor’s assets transfer, convey or abandon any of the debtor’s assets to another party during the period of this report other than as set forth herein (including sales by creditors)?
YesNo _Xif yes, explain:
15.
PAYMENT TO SECURED CREDITORS during reporting period:
Frequency of Payments
per Contract (mo.
Amount of
Each
Creditor
Qtr)
Payment
Next Payment Due
Post-Petition Pmts. No Made
No.
Amount
LC Capital Master Fund
No Scheduled Payments
$
447,251.81 (3/24/06
)
2
$
747,251.81
$
300,000.00 (4/13/06
)
East River Capital, LLC
Monthly fee & expenses
$
6,565.78 (4/12/06
)
1-May
1
$
6,565.78
Escrow Funding
$
400,000.00 (3/25/06
)
2
$
600,000.00
Escrow Funding
$
200,000.00 (4/13/06
)
16.
PAYMENTS TO PROFESSIONALS (Attorneys, Accountants, Real Estate Agents, Auctioneers, Appraisers, etc., during reporting period:
Professional
Service
Amount
Equity Committee Member
Peter Niemi
– expense reimbursement
$
5,192.38
Boardroom Specialist
Bankruptcy Specialist
$
75,000.00
Connolly Bove Lodge & Hutz
Equity Committee Lawyers
$
50,000.00
17. QUARTERLY U.S. TRUSTEE FEES paid during reporting period: $0
18. VERIFICATION: I declare under penalty of perjury 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.
Dated:May 25, 2006DEBTOR-IN-POSSESSION
Signature:
/s/ Perry L. Nolen
Xybernaut Corporation
Name/Title:
Perry L. Nolen, CEO/President
5175 Parkstone Drive
Address:
5175 Parkstone Drive
Suite 130
Suite 130
Chantilly, VA 20151
Chantilly, VA 20151
703-480-0480
1
IN THE UNITED STATES BANKRUPTCY COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION
)
)
)
In re:
)
XYBERNAUT CORPORATION,
)
Case No. 05-12801 RGM
Debtor.
)
Chapter 11
Cash Disbursements Summary Report
Calendar Month EndingApril 30, 2006
Total Disbursements from Operating Account
(See Note 1) $376,557.62
Total Disbursements from Payroll Account
(See Note 2) $171,558.39
Total Disbursements from Tax Escrow Account
(See Note 3) $0.00
Total Disbursements from any other Account
(See Note 4) $0.00
Grand Total Disbursements from all Accounts
$
548,116.01
(1) Xybernaut has only 1 bank account for Operations and Payroll – amounts listed separately for information purposes only.
Note 1 — Include in this amount all checks written, wire transfers made from, or any other withdrawal from the general operating account. Exclude only transfers to the debtor-in-possession payroll account, the debtor-in-possession account tax escrow account or other debtor in possession account where the disbursements will be listed on this report.
Note 2 — Include in this amount all checks written, wire transfers made from, or any other withdrawal from the payroll account. Exclude only transfers to the debtor-in-possession operating account, the debtor- in-possession tax escrow account or other debtor-in-possession account where the disbursements will be listed on this report.
Note 3 — Include in this amount all checks written, wire transfers made from, or any other withdrawal from the tax escrow account. Exclude only, transfers to the debtor-in-possession operating account, the debtor-in-possession payroll account or other debtor-in-possession account where the disbursements will be listed on this report.
Note 4 — Include in this amount any other disbursements made by the debtor including (but not limited to) cash paid from a petty cash fund or cash register, amounts paid from any other debtor-in-possession account, and amounts paid from the accounts of others on the debtors behalf (for example disbursements made from a law firm’s escrow account as a result of a sale of property.)
2
IN THE UNITED STATES BANKRUPTCY COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION
In re: XYBERNAUT CORPORATION, Debtor.
) )
Case No. 05-12801 RGM Chapter 11
MONTHLY OPERATING REPORT BALANCE SHEET (Business Debtor, Accrual Basis) As of April 30, 2006
ASSETS
Current assets:
Cash
$
32,640
Petty Cash
55
Restricted cash (ERC escrow)
600,000
Pre-petition accounts receivable
94,678
Post-petition accounts receivable
189,480
Less accounts receivable other and reserves
(502,281
)
Inventory
1,868,982
Prepaid and other current assets
784,916
Due to / due from accounts less reserve
613,635
Due to / due from Xybernaut Solutions Inc.
(1,067,692
)
Total current assets
$
2,614,413
Fixed assets:
Property and equipment
$
1,865,535
Less: accumulated depreciation
(1,762,562
)
Total fixed assets
102,973
Other assets:
Investment in subsidiaries
$
605,584
Patents, net
601,520
Trademarks, net
16,830
Other
165,464
Total other assets
1,389,398
TOTAL ASSETS
$
4,106,784
LIABILITIES AND EQUITY
Post-Petition Liabilities:
Accounts payable
140,769
Accrued DIP loan payable
2,400,000
Accrued Premium on DIP loan payable
1,500,000
Deferred Product and Warranty Revenue
109,099
Accrued Professional fees
*4,109,872
Accrued Purchases
82,858
Salaries/Commissions Payable
166,112
Total Post-petition liabilities
$
8,508,710
Pre-Petition Liabilities:
Priority Claims
105,810
Unsecured Debt
1,602,425
Accrued expenses
186,519
Total Pre-petition liabilities
1,894,754
Total liabilities
$
10,403,464
Shareholders’ equity:
Common stock
1,946,209
Additional paid-in capital
183,745,591
Cumulative translation adjustment
38,695
Accum. other comprehensive income (XSI)
37,130
Retained earnings, beginning
(171,411,927
)
Current Retained Earnings – Pre-petition
(10,953,998
)
Current Retained Earnings – Post-petition
* (9,698,380
)
Total shareholders’ equity
($6,296,680
)
TOTAL LIABILITIES AND EQUITY
$
4,106,784
*Accrued Professional Fees and Current Retained Earnings include approximately $506,885 in accrued professional fees for the first quarter of 2006 and $697,000 in accrued professional fees for the fourth quarter of 2005, all of which were not previously recorded. *Retained Earnings include $1,200,000 of the premium under the East River Capital DIP Loan not previously recorded. The premium was earned on March 24, 2006 upon funding of the East River Capital DIP Loan.
3
•
IN THE UNITED STATES BANKRUPTCY COURT FOR THE EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION
In re: XYBERNAUT CORPORATION, Debtor.
) ) )
Case No. 05-12801 RGM Chapter 11
MONTHLY OPERATING REPORT INCOME STATEMENT (Business Debtor, Accrual Basis) Calendar MonthApril 1, 2006 to April 30, 2006 (All figures refer to post-petition transactions)
Month
Year-to-date 2006
Revenue:
Hardware
$
130,237
$
418,688
Services
22,053
129,435
Total revenue
$
152,290
$
548,123
Cost of sales:
Beginning inventory
$
2,473,672
$
2,551,215
Purchase of inventory / transfers
38,057
235,680
Less ending inventory
(2,409,227
)
(2,409,227
)
Purchased goods and services
2,466
56,632
Total cost of sales
$
104,968
$
434,300
Gross profit
$
47,322
$
113,823
��
Operating expenses:
Officer’s salaries (gross)
$
55,833
$
219,167
Other employee salaries (gross)
116,571
512,402
Employee benefits (insurance, eb plan, taxes)
33,581
116,701
Depreciation & amortization
40,001
169,818
Corporate meetings / entertainment
577
3,684
Insurance
31,004
107,744
Interest (mortgage, loans, etc.)
—
4,554
Premium on DIP loan payable (ERC)
300,000
*1,500,000
Settlement (LC Fund DIP Loan)
300,000
300,000
Professional fees (attorney, accountant )
649,834
*2,443,819
Rent and leases
10,931
48,735
Repairs and maintenance
—
275
Supplies, dues & subscriptions
1,205
4,905
Taxes
—
199
Telephone
4,646
21,789
Travel
15,159
65,597
U.S. Trustee quarterly fee
—
3,750
Internet / website
1,665
9,622
Office expense
4,406
10,603
Postage
—
Printing
—
706
Public company expense
1,752
36,433
Equipment
6,649
20,114
Courier/overnight
507
3,279
Customer support
—
1,000
Office move
—
18,721
Total operating expenses
$
1,574,321
$
5,623,617
Net loss
($1,526,999
)
*($5,509,794
)
*Professional fees and year-to-date net loss includes approximately $506,885 in accrued professional fees for the first quarter of 2006 not previously recorded. *Premium on DIP Loan payable (ERC) and year-to-date net loss includes $1,200,000 of the premium under the East River Capital DIP Loan not previously recorded. The premium was earned on March 24, 2006 upon funding of the East River Capital DIP Loan.
NOTE: Accrual basis reporters must attach Cash Reconciliation Reports or a standard Statement of Sources and Uses of Cash to this Report.
Amounts shown represent payroll activity for the month of April that occurred in
Payroll
Tax
the combined Operating/Payroll acct.
Account
Account
(A) Beginning Cash Balance (A)
—
Cash Receipts:
$
171,558.39
—
Transfers from Operating Account
—
—
Transfers from Payroll Account
—
—
Other — ___________________________________
—
—
(B) Total Cash Receipts (B)
—
—
$
171,558.39
(C) Cash Available (C= A+B)
$
12,768.54
Cash Disbursements:
—
Gross Payroll for this period $155,637.82
$
105,017.37
Employee Benefits paid
$
11,727.94
Net Payroll Paid
—
Transfers to Tax Account
$
11,727.94
Taxes deposited or paid during period
—
—
Employee’s share of FICA Tax
$
22,682.13
—
Employer’s share of FICA Tax
—
—
Employee’s Federal Income Tax
$
6,786.47
—
Employee’s State Income Tax
—
—
Unemployment Tax
$
0.00
—
Unrecorded Bank Service Charges
—
—
Other: ____________________________
$
848.00
—
(D) Total Disbursements (D)
$
171,558.39
—
(E) Ending Cash Balance (E= C-D)
__$0__________
—
(F) Balance per Bank Statement (F)
__$0__________
—
(G) Less Outstanding Checks (G)
—
—
(H) Add Deposits in Transit
—
—
(I) Reconciled Bank Balance {I = (F-G) +H]
_ $0__________
—
Ending Cash Balance (E) and Reconciled Bank Balance (I) should equal.
5
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