EXHIBIT 99.1
TRANSMITTAL OF FINANCIAL REPORTS AND
CERTIFICATION OF COMPLIANCE WITH
UNITED STATES TRUSTEE OPERATING REQUIREMENTS FOR
THE PERIOD ENDED: 2-28-99
IN RE: :
CASE NO: 96-15177
Fretter, Inc. : Chapter 11
Judge Morgenstern-Clarren
:
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Debtor
:
As debtor in possession, I affirm:
1. That I have reviewed the financial statements attached hereto, consisting
of:
X Operating Statement (Form 2)
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X Balance Sheet (Form 3)
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X Summary of Operations (Form 4)
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X Monthly Cash Statements (Form 5)
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X Statement of Compensation (Form 6)
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and that they have been prepared in accordance with normal and customary
accounting practices, and fairly and accurately reflect the debtor's financial
activity for the period stated:
2. That the insurance as described in Section 4 of the Operating Instructions
and Reporting Requirements for Chapter 11 Cases is in effect; and, (if not,
attach written explanation)
3. That all postpetition taxes as described in Sections 1 and 14 of the
Operating Instructions and Reporting Requirements For Chapter 11 cases are
current. (If not, attach written explanation)
4. No professional fees (attorney, accountant, etc.) have been paid without
specific court authorization. Explain on separate sheet if not true.
I hereby certify, under penalty of perjury, that the information provided herein
is true and correct to the best of my information and belief.
Dated: 3/16/99 /s/ J. Michael McLean
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Debtor in Possession
Controller 248-213-3899
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Title Phone
OPERATING STATEMENT (P&L)
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(Accrual Basis)
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Debtor: Fretter, Inc. Case No: 96-15177
Month Ending: 2/28/99
Total
Current Month Since Filing
Total Revenue/Sales 0 532,663
Cost of Sales 0 505,226
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Gross Profit 0 27,437
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EXPENSES:
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Officer Compensation 7,474 396,760
Salary Expenses other Employees 5,628 468,306
Court-Ordered Stay Bonus 0 221,581
Employee Benefits & Pensions 0
Payroll Taxes 1,731 88,211
Other Taxes 0 85,454
Rent and Lease Expense 3,274 121,901
Interest Expense 0 4,340,722
Insurance 4,185 647,985
Automobile and Truck Expense 0
Utilities (gas, electric, phone, alarms) 1,225 178,220
Computer Service Bureau 1,333 36,030
Travel and Entertainment 0 22,976
Repairs and Maintenance 0 310,160
Advertising 0
Supplies, Office Expenses, etc. 7,297 484,846
Other: Specify Director & Trustee Fees 7,066 206,660
Other: Other Fees 1,938 36,219
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TOTAL EXPENSES: 41,151 7,646,031
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NET OPERATING PROFIT/(LOSS) (41,151) (7,618,594)
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Add: Non-Operating Income:
Interest Income 4,781 97,060
Gain/Loss on Sale of Real Estate 0 8,516,397
Other Income 3,943 2,066,389
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Total 8,724 10,679,846
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Less: Non-Operating Expenses:
Professional Fees 239,555 5,374,477
Other 0 645,106
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NET INCOME / (LOSS) (271,982) (2,958,331)
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BALANCE SHEET
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Debtor: Fretter, Inc. Case No: 96-15177
Month Ending: 2/28/99
ASSETS: Current Month Prior Month At Filing
Cash: 4,491,817 4,544,501 89,252
Inventory: 791,999
Accounts Receivable: ** 2,339,445 2,339,645 35,930,804*
Insider Receivables 3,555,136 3,555,136 7,424,547
Land and Buildings: 1,519,139 1,519,139 49,365,801
Furniture, Fixtures & Equip. 418,000
Accumulated Depreciation (305,453) (305,453) (10,623,681)
Other: Prepaids & misc. 207,655 213,174 807,689
Other: Utility deposits 6,000 6,000
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TOTAL ASSETS: 11,813,739 11,872,142 84,204,411
=========== =========== ===========
LIABILITIES:
Postpetition Liabilities:
Accounts Payable: 31,758 16,369
Wages and Salaries: 6,176 7,301
Taxes Payable 2,613 2,044
Other: Prof. fees, interest, etc. 3,889,252 3,681,036 1,390
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TOTAL Postpetition Liab.: 3,929,799 3,706,750 1,390
=========== =========== ===========
Secured Liabilities:
Subject to Postpetition
Collateral or Financing Order 0 0 29,002,401
All Other Secured Liab. 0 0 7,371,875
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TOTAL Secured Liabilities: 0 0 36,374,276
=========== =========== ===========
Prepetition Liabilities:
Taxes & Other Priority Liab. 434,239 434,239 1,132,770
Unsecured Liabilities 6,085,486 6,082,485 6,849,397
Other: Accrued Liabilities 4,165,318 4,177,788 5,449,917
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TOTAL Prepetition Liab. 10,685,133 10,694,602 13,432,084
=========== =========== ===========
Redeemable Preferred Stock 48,265,040 48,265,040 48,265,040
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Equity:
Owners' Capital: 1,692,451 1,692,451 1,692,451
Retained Earnings-Pre Pet. (49,800,353) (49,800,353) (15,560,830)
Retained Earnings-Post Pet. (2,958,331) (2,686,349) 0
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TOTAL Equity: (51,066,233) (50,794,251) (13,868,379)
=========== =========== ===========
TOTAL LIABILITIES
AND EQUITY: 11,813,739 11,872,141 84,204,411
=========== =========== ===========
______________________________
* Includes contingent receivable from Silo, Inc.,
collectibility indeterminate.
** Amounts due from subsidiary companies, collectibility
indeterminate.
SUMMARY OF OPERATIONS
---------------------
Period Ended: 2/28/99
Debtor: Fretter, Inc. Case No: 96-15177
Schedule of Postpetition Taxes Payable
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Beginning Accrued/ Payments/ Ending
Balance Withheld Deposits Balance
--------- -------- --------- -------
Income Taxes Withheld:
Federal: 0 2,810 2,810 0
State: 680 653 680 653
Local:
FICA Withheld: 0 1,135 1,135 0
Employers FICA: 0 1,135 1,135 0
Unemployment Tax:
Federal: 113 40 0 153
State: 1,251 566 0 1,807
Sales, Use & Excise Taxes 0 0
Property Taxes 0 0 0 0
Workers' Compensation
Other:
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TOTALS 2,044 6,329 5,760 2,613
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AGING OF ACCOUNTS RECEIVABLE
AND POSTPETITION ACCOUNTS PAYABLE
Age in Days 0-30 30-60 Over 60
PostPetition
Accounts Payable 16,369
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Accounts Receivable 3,059,739
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For all postpetition accounts payable over 30 days old, please attach a sheet
listing each such account, to whom the account is owed, the date the account was
opened, and the reason for non payment of the account.
Describe events or factors occurring during this reporting period materially
affecting operations and formulation of a plan of Reorganization.
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MONTHLY CASH STATEMENT
Debtor: Fretter, Inc. Statement for the period:
Case #: 96-15177 From: 2-1-99 To: 2-28-99
Cash Activity Analysis (Cash Basis Only):
General Payroll Tax Cash Coll. B.T.
Acct. Acct. Acct. Acct. (B.T.) Direct(1)
------- ------- ----- ------------ ---------
A. Beginning Balance: 117,393.55 4,595.44 3,686.30 0.00 0.00
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B. Receipts. Attach
Separate Schedule: 7,442.91 10,943.81 7,178.48 0.00 0.00
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C. Balance Available
(A + B): 124,836.46 15,539.25 10,864.78 0.00 0.00
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D1. Less Cash Transfers 0.00 0.00 0.00 0.00 0.00
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D2. Less Disbursements
Attach separate
schedule: 67,201.36 10,048.06 5,767.62 0.00 0.00
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E. Ending Balance
(C-D.1-D.2): 57,635.10 5,491.19 5,097.16 0.00 0.00
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(PLEASE ATTACH COPIES OF MOST RECENT RECONCILED BANK STATEMENTS FROM EACH
ACCOUNT):
General Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38120-0
Payroll Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38024-4
Tax Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38128-3
Other monies on hand (specify type and location) (i.e., CD's petty cash):
BT Collateral Acct. - Old Kent Bank, Acct. No 229377
BT Direct - BT cash collateral is forwarded directly to B.T.
Date:
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Debtor in Possession
MONTHLY CASH STATEMENT
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Debtor: Fretter, Inc. Statement for the period:
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Case No.: 96-15177 From: 2-1-99 To: 2-28-99
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Cash Activity Analysis (Cash Basis Only):
NBD
General MNB Certificate
Savings Certificate of of
Acct. Deposit Deposit
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A. Beginning Balance: 118,825.29 0.00 4,300,000
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B. Receipts. Attach Separate Schedule: 386.15 0.00 4,444.44
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C. Balance Available (A+B): 119,161.44 0.00 4,304,444.44 0.00 0.00
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D.1. Less Cash Transfers 0.00 0.00 0.00 0.00
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D.2. Less Disbursments Attach separate
schedule: 12.16 0.00 0.00 0.00 0.00
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E. Ending Balance (C-D.1.-D.2.): 119,149.28 0.00 4,304,444.44 0.00 0.00
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(PLEASE ATTACH COPIES OF MOST RECENT RECONCILED BANK STATEMENTS FROM EACH
ACCOUNT)
General Savings Account
1. Depository Name & Location Michigan National Bank, Brighton, MI
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2. Account Number 4707-38293-5
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Certificate of Deposit
1. Depository Name & Location Michigan National Bank, Brighton, MI
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2. Account Number #880976, 880984, 880985
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Certificate of Deposit
1. Depository Name & Location NBD Bank, Southfield, MI
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2. Account Number #53314977, #53315040, #53315115, #533151180
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Other monies on hand (specify type and location)(i.e., CD's petty cash):
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Date:
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Debtor in Possession
MONTHLY STATEMENT OF COMPENSATION
---------------------------------
The following information is to be provided for each shareholder,
officer, director, manager, insider, or owner that is employed by the debtor in
possession. Attach additional pages if necessary.
Name: J. Michael McLean Capacity: Principal
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X Officer
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Director
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Insider
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Detailed Description of Duties: As Controller, directs accounting, payroll,
benefit plans and tax filings as well as assists in cash flow planning
Current Compensation Paid:
Weekly or Monthly
9,167.00
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Current Benefits Received:
Weekly or Monthly
Vacation Pay ------ --------
Holiday Pay ------ --------
Retirement ------ --------
Company Vehicle ------ --------
Entertainment ------ --------
Travel ------ --------
Other Benefits ------ --------
CURRENT TOTAL:
Weekly or Monthly
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Dated: -------------------------------------
Principal, Officer, Director, Insider
LIST OF OMITTED SCHEDULES
1. Schedule of Michigan National Bank February 1999 Cash Receipts (Account
Number 4707-38120-0)
2. Schedules of Michigan National Bank February 1999 Cash Disbursements,
Account Reconciliation and Outstanding Check List (Account Number 4707-38120-0)
3. Michigan National Bank Statement of Account for the Period February 1, 1999
to February 28, 1999 (Account Number 4707-38120-0)
4. Michigan National Bank Statement of Account for the Period February 1, 1999
to February 28, 1999 (Account Number 4707-38024-4)
5. Schedules of Michigan National Bank Payroll Account February 1999 Cash
Receipts and Disbursements and Account Reconciliation (Account Number 4707-
38024-4)
6. Schedules of Michigan National Bank Tax Account February 1999 Cash Receipts
and Disbursements and Account Reconciliation (Account Number 4707-38128-3)
7. Michigan National Bank Statement of Account for the Period February 1, 1999
to February 28, 1999 (Account Number 4707-38128-3)
8. Schedule of Bankers Trust February 1999 Cash Receipts
9. Schedules of Michigan National Bank General Savings Account February 1999
Cash Receipts and Disbursements (Account Number 4707-38293-5)
10. Michigan National Bank Statement of Account for the Period February 1, 1999
to February 28, 1999 (Account Number 4707-38293-5)
11. Schedule of Michigan National Bank Certificate of Deposit February 1999
Cash Receipts