1
EXHIBIT 99.7
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS
CASE NUMBER: 401-40784-BJH-11
JUDGE: BARBARA J. HOUSER
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF TEXAS
-------- -----
FORT WORTH DIVISION
----------
MONTHLY OPERATING REPORT
MONTH ENDING: APRIL 30, 2001
--------------
IN ACCORDANCE WITH TITLE 28, SECTION 1746, OF THE UNITED STATES CODE, I DECLARE
UNDER PENALTY OF PERJURY THAT I HAVE EXAMINED THE FOLLOWING MONTHLY OPERATING
REPORT (ACCRUAL BASIS - 1 THROUGH ACCRUAL BASIS - 7) AND THE ACCOMPANYING
ATTACHMENTS AND, TO THE BEST OF MY KNOWLEDGE, THESE DOCUMENTS ARE TRUE, CORRECT
AND COMPLETE. DECLARATION OF THE PREPARER (OTHER THAN RESPONSIBLE PARTY): IS
BASED ON ALL INFORMATION OF WHICH PREPARER HAS ANY KNOWLEDGE.
RESPONSIBLE PARTY:
/s/ JOSEPH P. TOMCZAK TREASURER
- --------------------------------------- -------------------------
Original Signature of Responsible Party Title
JOSEPH P. TOMCZAK MAY 29, 2001
- --------------------------------------- -------------------------
Printed Name of Responsible Party Date
PREPARER:
/s/ DENNIS S. FAULKNER DEBTOR'S ACCOUNTANT
- --------------------------------------- -------------------------
Original Signature of Preparer Title
DENNIS S. FAULKNER MAY 29, 2001
- --------------------------------------- -------------------------
Printed Name of Preparer Date
2
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 1
CASE NUMBER: 401-40784-BJH-11
COMPARATIVE BALANCE SHEET
SCHEDULED MONTH MONTH MONTH
ASSETS AMOUNT FEB-01 MAR-01 APR-01
- ------ --------- ------ ------ ------
1. Unrestricted Cash (FOOTNOTE) 41,683
2. Restricted Cash
3. Total Cash 41,683 0 0 0
4. Accounts Receivable (Net) (FOOTNOTE) 7,974,696 4,933,430 5,874,185 3,321,621
5. Inventory (FOOTNOTE) 14,793,828 7,980,684 4,859,572 1,814,506
6. Notes Receivable
7. Prepaid Expenses 196,584 172,282 123,925 189,297
8. Other (Attach List) 6,598 98 0 0
9. Total Current Assets 23,013,389 13,086,495 10,857,682 5,325,424
10. Property, Plant & Equip. (FOOTNOTE) 32,082,187 28,603,697 28,652,257 13,775,429
11. Less: Accumulated Depreciation (FOOTNOTE) (7,696,543) (6,643,000) (6,807,128) (2,694,783)
12. Net Property, Plant & Equipment 24,385,644 21,960,698 21,845,129 11,080,646
13. Due From Insiders
14. Other Assets - Net of Amortization
(Attach List) 8,369,096 8,347,100 8,325,105 0
15. Other (Attach List) 13,541,943 20,020,858 21,711,278 31,452,761
16. Total Assets 69,310,072 63,415,150 62,739,194 47,858,831
POST PETITION LIABILITIES
17. Accounts Payable 15,192 110,434 66,617
18. Taxes Payable (FOOTNOTE) 105,632 151,685 27,605
19. Notes Payable
20. Professional Fees
21. Secured Debt
22. Other (Attach List) 1,366,523 1,264,568 602,626
23. Total Post Petition Liabilities 1,487,347 1,526,687 696,848
PRE PETITION LIABILITIES
24. Secured Debt (FOOTNOTE) 75,885,064 63,113,388 63,113,388 41,900,067
25. Priority Debt (FOOTNOTE) 1,383,756
26. Unsecured Debt (FOOTNOTE) 5,139,545 3,842,137 3,621,510 3,524,210
27. Other (Attach List) 197,008,999 197,509,594 197,948,008 197,951,008
28. Total Pre Petition Liabilities 279,417,364 264,465,120 264,682,906 243,375,285
29. Total Liabilities 279,417,364 265,952,467 266,209,593 244,072,133
EQUITY
30. Pre Petition Owners' Equity (210,107,292) (210,107,292) (210,107,292)
31. Post Petition Cumulative Profit Or
(Loss) (5,079,239) (6,012,322) (19,965,544)
32. Direct Charges To Equity (Attach
Explanation FOOTNOTE) 12,649,215 12,649,215 33,859,534
33. Total Equity (202,537,316) (203,470,399) (196,213,302)
34. Total Liabilities and Equity 63,415,150 62,739,194 47,858,831
This form x does does not have related footnotes on Footnotes Supplement.
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3
CASE NAME: KEVCO MANUFACTURING, LP SUPPLEMENT TO
CASE NUMBER: 401-40784-BJH-11 ACCRUAL BASIS - 1
COMPARATIVE BALANCE SHEET
SCHEDULED MONTH MONTH MONTH
ASSETS AMOUNT FEB-01 MAR-01 APR-01
- ------ --------- ------ ------ ------
A. Security Deposits 6,598 98 0 0
B.
C.
D.
E.
TOTAL OTHER ASSETS - LINE 8 6,598 98 0 0
A. Goodwill: Consolidated Forest
Products (FOOTNOTE) 8,369,096 8,347,100 8,325,105 0
B.
C.
D.
E.
TOTAL OTHER ASSETS NET OF
AMORTIZATION - LINE 14 8,369,096 8,347,100 8,325,105 0
Intercompany Receivables
A. (FOOTNOTE) 13,541,943 20,020,858 21,711,278 31,452,761
B.
C.
D.
E.
TOTAL OTHER ASSETS - LINE 15 13,541,943 20,020,858 21,711,278 31,452,761
POST PETITION LIABILITIES
A. Accrued Payroll 847,056 629,663 332,547
B. Accrued Liabilities (FOOTNOTE) 519,467 634,905 270,079
C.
D.
E.
TOTAL OTHER POST PETITION
LIABILITIES - LINE 22 1,366,523 1,264,568 602,626
PRE PETITION LIABILITIES
A. Interco. Payables (FOOTNOTE) 68,508,999 69,009,594 69,448,008 69,451,008
B. 10 3/8% Senior Sub. Notes 105,000,000 105,000,000 105,000,000 105,000,000
C. Sr. Sub. Exchangeable Notes 23,500,000 23,500,000 23,500,000 23,500,000
D.
E.
TOTAL OTHER PRE PETITION
LIABILITIES - LINE 27 197,008,999 197,509,594 197,948,008 197,951,008
4
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 2
CASE NUMBER: 401-40784-BJH-11
INCOME STATEMENT
MONTH MONTH MONTH QUARTER
REVENUES FEB-01 MAR-01 APR-01 TOTAL
- -------- ------ ------ ------ -------
1. Gross Revenues 9,497,654 8,276,526 2,593,847 20,368,027
2. Less: Returns & Discounts (236,301) (221,852) (121,458) (579,611)
3. Net Revenue 9,261,353 8,054,674 2,472,389 19,788,416
COST OF GOODS SOLD
4. Material 8,167,587 7,327,837 2,045,472 17,540,896
5. Direct Labor 307,854 257,318 174,362 739,534
6. Direct Overhead 307,731 257,213 100,895 665,839
7. Total Cost of Goods Sold 8,783,172 7,842,368 2,320,729 18,946,269
8. Gross Profit 478,181 212,306 151,660 842,147
OPERATING EXPENSES
9. Officer / Insider Compensation 46,386 43,957 121,989 212,332
10. Selling & Marketing 2,786 819 3,605
11. General & Administrative 50,247 45,115 11,236 106,598
12. Rent & Lease 97,786 79,464 42,046 219,296
13. Other (Attach List) 659,068 380,608 331,120 1,370,796
14. Total Operating Expenses 856,273 549,963 506,392 1,912,627
15. Income Before Non-Operating
Income & Expense (378,092) (337,657) (354,732) (1,070,480)
OTHER INCOME & EXPENSES
16. Non-Operating Income (Att List) (2,423) (1,168) (6,125) (9,716)
17. Non-Operating Expense (Att List) 4,661,402 554,036 13,574,326 18,789,764
18. Interest Expense 1,266 1,266
19. Depreciation / Depletion 40,902 42,558 30,290 113,750
20. Amortization 0
21. Other (Attach List) 0
22. Net Other Income & Expenses (4,701,147) (595,426) (13,598,491) (18,895,064)
REORGANIZATION EXPENSES
23. Professional Fees 0
24. U.S. Trustee Fees 0
25. Other (Attach List) 0
26. Total Reorganization Expenses 0 0 0 0
27. Income Tax 0
28. Net Profit (Loss) (5,079,239) (933,083) (13,953,222) (19,965,544)
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO MANUFACTURING, LP SUPPLEMENT TO
CASE NUMBER: 401-40784-BJH-11 ACCRUAL BASIS - 2
INCOME STATEMENT
MONTH MONTH MONTH QUARTER
OPERATING EXPENSES FEB-01 MAR-01 APR-01 TOTAL
- ------------------ ------ ------ ------ -------
A. Payroll & Employee Benefits 473,634 197,958 196,394 867,986
B. Insurance Expense 98,171 86,110 85,273 269,554
C. Utilities and Telephone 30,707 39,973 24,045 94,725
D. Taxes 56,556 56,567 25,408 138,531
E. 0
TOTAL OTHER OPERATING
EXPENSES - LINE 13 659,068 380,608 331,120 1,370,796
OTHER INCOME & EXPENSES
A. Miscellaneous Income (2,423) (1,168) (6,125) (9,716)
B. 0
C. 0
TOTAL NON-OPERATING INCOME
- LINE 16 (2,423) (1,168) (6,125) (9,716)
A. Interco. working capital charge 163,912 112,675 22,914 299,501
B. Intercompany management fee 103,823 38,809 142,632
C. Intercompany royalty fee 277,234 92,459 369,693
D. Intercompany interest charges 620,186 310,093 930,279
E. Loss on sale of Design Comp.
(FOOTNOTE) 3,496,247 3,496,247
F. Loss on sale of Wood Group
(FOOTNOTE) 13,551,412 13,551,412
G.
TOTAL NON-OPERATING
EXPENSE - LINE 17 4,661,402 554,036 13,574,326 18,789,764
REORGANIZATION EXPENSES
A. 0
B. 0
C. 0
D. 0
E. 0
TOTAL OTHER REORGANIZATION
EXPENSES - LINE 25 0 0 0 0
6
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 3
CASE NUMBER: 401-40784-BJH-11
CASH RECEIPTS AND MONTH MONTH MONTH QUARTER
DISBURSEMENTS FEB-01 MAR-01 APR-01 TOTAL
- ----------------- ------ ------ ------ -------
1. Cash - Beginning Of Month SEE ATTACHED SUPPLEMENT AND FOOTNOTE
RECEIPTS FROM OPERATIONS
2. Cash Sales
COLLECTION OF ACCOUNTS RECEIVABLE
3. Pre Petition
4. Post Petition
5. Total Operating Receipts
NON-OPERATING RECEIPTS
6. Loans & Advances (Attach List)
7. Sale of Assets
8. Other (Attach List)
9. Total Non-Operating Receipts
10. Total Receipts
11. Total Cash Available
OPERATING DISBURSEMENTS
12. Net Payroll
13. Payroll Taxes Paid
14. Sales, Use & Other Taxes Paid
15. Secured / Rental / Leases
16. Utilities
17. Insurance
18. Inventory Purchases
19. Vehicle Expenses
20. Travel
21. Entertainment
22. Repairs & Maintenance
23. Supplies
24. Advertising
25. Other (Attach List)
26. Total Operating Disbursements
REORGANIZATION DISBURSEMENTS
27. Professional Fees
28. U.S. Trustee Fees
29. Other (Attach List)
30. Total Reorganization Expenses
31. Total Disbursements
32. Net Cash Flow
33. Cash - End of Month
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO MANUFACTURING, LP SUPPLEMENT TO ACCRUAL BASIS - 3
APRIL, 2001
CASE NUMBER: 401-40784-BJH-11 CASH RECEIPTS AND DISBURSEMENTS
DIST LP MFG MGMT HOLDING COMP KEVCO INC TOTAL
------- --- ---- ------- ---- --------- -----
1 CASH-BEGINNING OF MONTH 1,483 (95,242) 26,213,696 5,010 6,050 1,000 26,131,997
RECEIPTS FROM OPERATIONS
2 CASH SALES 121,372 -- 121,372
COLLECTION OF ACCOUNTS RECEIVABLE
3 PRE PETITION 61,354 -- 61,354
4 POST PETITION 7,225,297 4,705,194 11,930,491
5 TOTAL OPERATING RECEIPTS 7,408,023 4,705,194 -- -- -- -- 12,113,217
NON OPERATING RECEIPTS
6 LOANS & ADVANCES -- --
7 SALE OF ASSETS 38,500 7,012,936 7,051,436
8 OTHER 171,186 -- 87,708 -- -- -- 258,894
INTERCOMPANY TRANSFERS (4,591,461) (2,381,789) 6,973,250 -- -- --
SALE EXPENSE REIMBURSEMENT
LIFE INSURANCE CASH VALUE 152,493
RENT 16,000
TAX REFUND 2,693
MISC. --
INTEREST INCOME 87,708
9 TOTAL NON OPERATING RECEIPTS (4,381,775) 4,631,147 7,060,958 -- -- -- 7,310,330
10 TOTAL RECEIPTS 3,026,248 9,336,341 7,060,958 -- -- -- 19,423,547
11 CASH AVAILABLE 3,027,731 9,241,099 33,274,654 5,010 6,050 1,000 45,555,544
OPERATING DISBURSEMENTS
12 NET PAYROLL 500,771 560,149 112,437 1,173,357
13 PAYROLL TAXES PAID -- 524,486 524,486
14 SALES, USE & OTHER TAXES PAID 9,429 770 10,199
15 SECURED/RENTAL/LEASES 496,959 130,335 71,718 699,012
16 UTILITIES 100,185 88,360 211,235 399,780
17 INSURANCE 6,099 -- 597,388 603,487
18 INVENTORY PURCHASES 1,269,266 1,178,079 2,447,345
19 VEHICLE EXPENSE 64,627 10,109 74,736
20 TRAVEL 21,689 12,853 643 35,185
21 ENTERTAINMENT -- 369 369
22 REPAIRS & MAINTENANCE 2,617 19,292 2,790 24,699
23 SUPPLIES 9,375 40,685 50,060
24 ADVERTISING -- -- --
25 OTHER 546,714 7,266,715 15,367,241 -- -- -- 23,180,670
LOAN PAYMENTS 324,609 7,012,936 15,000,000 22,337,545
FREIGHT 97,953 152,540 250,493
CONTRACT LABOR 617 1,976 31,937 34,530
401 K PAYMENTS -- 157,719 157,719
PAYROLL TAX ADVANCE ADP --
WAGE GARNISHMENTS --
MISC. 123,535 99,263 177,585 400,383
26 TOTAL OPERATING DISBURSEMENTS 3,027,731 9,307,716 16,887,938 -- -- -- 29,223,385
REORGANIZATION DISBURSEMENTS
27 PROFESSIONAL FEES -- 492,647 492,647
28 US TRUSTEE FEES -- --
29 OTHER --
30 TOTAL REORGANIZATION EXPENSE -- -- 492,647 -- -- -- 492,647
31 TOTAL DISBURSEMENTS 3,027,731 9,307,716 17,380,585 -- -- -- 29,716,032
32 NET CASH FLOW (1,483) 28,625 (10,319,627) -- -- -- (10,292,485)
33 CASH-END OF MONTH -- (66,617) 15,894,069 5,010 6,050 1,000 15,839,512
8
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 4
CASE NUMBER: 401-40784-BJH-11
SCHEDULED MONTH MONTH MONTH
ACCOUNTS RECEIVABLE AGING AMOUNT FEB-01 MAR-01 APR-01
- ------------------------- --------- ------ ------ ------
1. 0 - 30 4,468,648 5,833,124 2,356,342
2. 31 - 60 464,782 41,061 965,279
3. 61 - 90
4. 91 +
5. Total Accounts Receivable 7,974,696 4,933,430 5,874,185 3,321,621
6. (Amount Considered Uncollectible)
7. Accounts Receivable (Net) 7,974,696 4,933,430 5,874,185 3,321,621
AGING OF POST PETITION MONTH: APRIL-01
TAXES AND PAYABLES ------------------
0 - 30 31 - 60 61 - 90 91 +
TAXES PAYABLE DAYS DAYS DAYS DAYS TOTAL
- ------------- ------ ------- ------- ----- -----
1. Federal --
2. State --
3. Local --
4. Other (See Below) 27,605 27,605
5. Total Taxes Payable 27,605 -- -- -- 27,605
6. Accounts Payable 66,617 66,617
MONTH: APRIL-01
----------------
STATUS OF POST PETITION TAXES
BEGINNING TAX AMOUNT WITHHELD ENDING TAX
FEDERAL LIABILITY* AND/OR ACCRUED (AMOUNT PAID) LIABILITY
- ------- ------------- --------------- ------------- ----------
1. Withholding ** 87,167 (87,167) 0
2. FICA - Employee ** 57,516 (57,516) 0
3. FICA - Employer ** 57,515 (57,515) 0
4. Unemployment 2,646 (2,646) 0
5. Income 0
6. Other (Attach List) 0
7. Total Federal Taxes 0 204,844 (204,844) 0
STATE AND LOCAL
8. Withholding 17,613 (17,613) 0
9. Sales (FOOTNOTE) 15,816 (4,832) 10,984
10. Excise 0
11. Unemployment 7,147 (7,147) 0
12. Real Property 0
13. Personal Property
(FOOTNOTE) 135,869 (119,248) 16,621
14. Other (Attach List) 0
15. Total State And Local 151,685 24,760 (148,840) 27,605
16. Total Taxes 151,685 229,604 (353,684) 27,605
* The beginning tax liability should represent the liability from the prior
month or, if this is the first operating report, the amount should be zero.
** Attach photocopies of IRS Form 6123 or your FTD coupon and payment receipt to
verify payment of deposit.
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 5
CASE NUMBER: 401-40784-BJH-11
The debtor in possession must complete the reconciliation below for each bank
account, including all general, payroll and tax accounts, as well as all savings
and investment accounts, money market accounts, certificates of deposit,
government obligations,
MONTH: MAR-01
-----------------
BANK RECONCILIATIONS Account # 1 Account # 2 Other Accounts
- -------------------- ----------- ----------- --------------
A. BANK: Bank of America KeyBank (Attach List)
B. ACCOUNT NUMBER: 3751764595 149651002847 TOTAL
C. PURPOSE (TYPE): DIP Disbursement-BB DIP Disbursement-Design
1. Balance Per Bank Statement 17,120 14,904 36,273 68,297
2. Add: Total Deposits Not Credited -- --
3. Subtract: Outstanding Checks (117,488) (32,868) (150,356)
4. Other Reconciling Items 3,319 -- 3,319
5. Month End Balance Per Books (97,049) 14,904 3,405 (78,740)
6. Number of Last Check Written N/A N/A
INVESTMENT ACCOUNTS
DATE OF TYPE OF
BANK, ACCOUNT NAME & NUMBER PURCHASE INSTRUMENT PURCHASE PRICE CURRENT VALUE
- --------------------------- -------- ---------- -------------- -------------
7.
8.
9.
10. (Attach List)
11. Total Investments
CASH
12. Currency On Hand 12,123
Reclass to Accounts Payable 66,617
13. Total Cash - End of Month
(FOOTNOTE) 0
This form x does does not have related footnotes on Footnotes Supplement.
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10
CASE NAME: KEVCO MANUFACTURING, LP SUPPLEMENT TO
CASE NUMBER: 401-40784-BJH-11 ACCRUAL BASIS - 5
MONTH: APRIL-01
----------------------
BANK RECONCILIATIONS Account # 3 Account # 4 Account # 5
- -------------------- ----------- ----------- -----------
A. BANK: GWJones Exch Bank TOTAL
B. ACCOUNT NUMBER: 0005006226 OTHER BANK
C. PURPOSE (TYPE): DIP Disbursement-DF ACCOUNTS
1. Balance Per Bank Statement 36,273 36,273
2. Add: Total Deposits Not Credited --
3. Subtract: Outstanding Checks (32,868) (32,868)
4. Other Reconciling Items --
5. Month End Balance Per Books 3,405 3,405
6. Number of Last Check Written N/A
INVESTMENT ACCOUNTS
DATE OF TYPE OF PURCHASE CURRENT
BANK, ACCOUNT NAME & NUMBER PURCHASE INSTRUMENT PRICE VALUE
- --------------------------- -------- ---------- -------- -------
A.
B.
C.
D.
TOTAL OTHER INVESTMENT
ACCOUNTS - LINE 10
11
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 6
CASE NUMBER: 401-40784-BJH-11
MONTH: APRIL-01
--------------------
PAYMENTS TO INSIDERS AND PROFESSIONALS
Of the Total Disbursements shown for the month, list the amount paid to Insiders
(as defined in Section 101(31)(A)-(F) of the U.S. Bankruptcy Code) and to
Professionals. Also, for payments to Insiders, identify the type of compensation
paid (e.g. salary, bonus, commissions, insurance, housing allowance, travel, car
allowance, etc.). Attach additional sheets if necessary.
INSIDERS
AMOUNT TOTAL PAID
NAME TYPE OF PAYMENT PAID TO DATE
---- --------------- ------ ---------
1. Lee Denham Payroll/severance 103,462 134,620
2. Lee Denham Expense Reimb. 254
3. Jim Connors Consulting fees and expenses 18,527 52,098
4.
5. (Attach List)
6. Total Payments To
Insiders 121,989 186,972
PROFESSIONALS
DATE OF
COURT ORDER TOTAL
AUTHORIZING AMOUNT AMOUNT TOTAL PAID INCURRED
NAME PAYMENT APPROVED PAID TO DATE & UNPAID*
---- ----------- -------- ------ ---------- ---------
1.
2.
3.
4.
5. (Attach List)
6. Total Payments To
Professionals -- -- -- --
* Include all fees incurred, both approved and unapproved
POST PETITION STATUS OF SECURED NOTES, LEASES PAYABLE AND ADEQUATE
PROTECTION PAYMENTS
SCHEDULED AMOUNTS TOTAL
MONTHLY PAID UNPAID
PAYMENTS DURING POST
NAME OF CREDITOR DUE MONTH PETITION
---------------- --------- ------- --------
1. Bank of America (FOOTNOTE) N/A $ 21,213,321 $ 41,900,067
2. Status of Leases Payable (FOOTNOTE)
3.
4.
5. (Attach List)
6. TOTAL $ -- $ 21,213,321 $ 41,900,067
This form x does does not have related footnotes on Footnotes Supplement.
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12
CASE NAME: KEVCO MANUFACTURING, LP ACCRUAL BASIS - 7
CASE NUMBER: 401-40784-BJH-11
MONTH: APRIL-01
------------------
QUESTIONNAIRE
YES NO
--- --
1. Have any Assets been sold or transferred outside the normal course of business this
reporting period? X
2. Have any funds been disbursed from any account other than a debtor in possession
account? X
3. Are any Post Petition Receivables (accounts, notes, or loans) due from related parties? X
4. Have any payments been made on Pre Petition Liabilities this reporting period? X
5. Have any Post Petition Loans been received by the debtor from any party? X
6. Are any Post Petition Payroll Taxes past due? X
7. Are any Post Petition State or Federal Income Taxes past due? X
8. Are any Post Petition Real Estate Taxes past due? X
9. Are any other Post Petition Taxes past due? X
10. Are any amounts owed to Post Petition creditors delinquent? X
11. Have any Pre Petition Taxes been paid during the reporting period? X
12. Are any wage payments past due? X
If the answer to any of the above questions is "Yes", provide a detailed
explanation of each item. Attach additional sheets if necessary.
SEE FOOTNOTE
INSURANCE
YES NO
--- --
1. Are Worker's Compensation, General Liability and other necessary insurance
coverages in effect? X
2. Are all premium payments paid current? X
3. Please itemize policies below.
If the answer to any of the above questions is "No", or if any policies have
been canceled or not renewed during this reporting period, provide an
explanation below. Attach additional sheets if necessary.
INSTALLMENT PAYMENTS
PAYMENT AMOUNT
TYPE OF POLICY CARRIER PERIOD COVERED & FREQUENCY
-------------- ------- -------------- --------------------
Property Lexington, Allianz 5/29/00-5/29/01 Annual $ 171,771
Group Health Blue Cross/Blue Shield Debtor is self-insured Annual 1,709,506
Auto Liberty Mutual 9/1/00-9/1/01 Annual 101,505
General Liability Liberty Mutual 9/1/00-9/1/01 Annual 141,519
Umbrella National Union 6/1/00-9/1/01 Annual 46,651
Workers Compensation Liberty Mutual 9/1/00-9/1/01 Annual 644,601
This form x does does not have related footnotes on Footnotes Supplement.
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13
CASE NAME: KEVCO MANUFACTURING, LP
CASE NUMBER: 401-40784-BJH-11
MONTH: APRIL 30, 2001
-------------------
FOOTNOTES SUPPLEMENT ACCRUAL BASIS
ACCRUAL
BASIS
FORM LINE
NUMBER NUMBER FOOTNOTE / EXPLANATION
- ------ ------ ----------------------
1 1 Pursuant to the February 12, 2001 Order (1) Authorizing Continued Use of
3 1 Existing Forms and Records; (2) Authorizing Maintenance of Existing
Corporate Bank Accounts and Cash Management System; and (3) Extending Time
to Comply with 11 U.S.C. Section 345 Investment Guidelines, funds in the
Bank of America and Key Bank deposit accounts are swept daily into Kevco's
lead account number 1295026976. The Bank of America lead account is
administered by, and held in the name of, Kevco Management Co. (co-debtor,
Case No. 401-40788-BJH-11). Accordingly, all cash receipts and
disbursements flow through Kevco Management's Bank of America DIP account.
A schedule allocating receipts and disbursements among Kevco, Inc. and its
subsidiaries is included in this report as a Supplement to Accrual Basis-3.
Debtor maintains several small petty cash accounts for use by its
operating divisions that are included in the cash supplement schedule.
1 1 Kevco Manufacturing, LP maintains several small petty cash accounts for use
3 1 by its various operating divisions. These amounts are intended to be
5 13 maintained on an imprest basis by way of intercompany transfers from Kevco
Management which maintains the lead account (see footnote for MOR 1, Line
1). The negative cash balance shown on the Supplement to Accrual Basis-3
and the bank reconciliations presented in MOR-5 is due to checks that were
issued on April 30 but not funded from Kevco's lead account until May 1.
Accrual Basis-1 (Debtor's balance sheet) reflects cash as $0 and the
issued and unfunded checks as post-petition accounts payable.
1 4,5 (A) Pursuant to an Asset Purchase Agreement approved by the Court on February
1 10,11 23, 2001 and effective as of the same date among Kevco, Inc., Kevco
1 14A Manufacturing, LP, Wingate Management Co. II, LP and Adorn, LLC, certain
1 24 assets and liabilities of Design Components, a division of Kevco
1 26 Manufacturing, were transferred to Adorn, LLC. At the effective date of
2 17E,F purchase, Buyer assumed certain executory contracts, approximately $1.6
6 1 million of debtor's unsecured pre-petition liabilities, $3.5 million of
7 1 accounts receivable, $5 million of inventory and $2.2 million (book value)
7 4 of property and equipment. Payment was made directly to Bank of America,
the secured lender, thereby reducing pre-petition secured debt. Kevco,
Inc.'s report reflects the transaction detail (see Footnote 1,32).
(B) Pursuant to an Asset Purchase Agreement approved by the Court on April 3,
2001 and effective as of the same date among Universal Forest Products
Eastern Division, Inc. and Kevco Manufacturing, LP, Universal purchased the
assets (inventory, equipment, machinery and five of the seven facilities at
which Sunbelt Wood Components Division operates) of the Sunbelt division of
Kevco Manufacturing, LP. Approximately $7 million in sales proceeds were
paid directly to Bank of America thereby reducing pre-petition secured
debt. In the course of recording this transaction, the goodwill associated
with the purchase of Consolidated Forest Products was eliminated.
(C) Debtor paid $15 million during April to Bank of America to reduce
pre-petition secured debt.
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14
ACCRUAL
BASIS
FORM LINE
NUMBER NUMBER FOOTNOTE / EXPLANATION
- ------ ------ ----------------------
1 15A Intercompany receivables/payables are from/to co-debtors Kevco Management
1 27A Co. (Case No. 401-40788-BJH-11), Kevco Distribution, LP (Case No.
7 3 401-40789-BJH-11), Kevco Holding, Inc. (Case No. 401-40785-BJH-11), DCM
Delaware, Inc. (Case No. 401-40787-BJH-11), Kevco GP, Inc. (Case No.
401-40786-BJH-11), Kevco Components, Inc. (Case No. 401-40790-BJH-11), and
Kevco, Inc. (Case No. 401-40783-BJH-11).
1 18 Sales tax owing is an accrual only and not yet due. Some of the property taxes
4 9, 13 payable may be pre-petition. Once they are identified, the monthly operating
report will be adjusted.
1 22B The Debtor records on its books accruals for certain liabilities based on
historical estimates. While the known creditors were listed on the Debtor's
Schedules, the estimated amounts were not. Accordingly, for purposes of this
report, the accrued liabilities are reflected as post-petition "Accrued
Liabilities."
1 25 Pursuant to Order dated February 12, 2001 and Supplemental Order dated March 14,
2001, debtors were authorized to pay pre-petition taxes, salaries and wages up
to a maximum of $4,300 per employee. Debtors were also (a) allowed to pay
accrued vacation to terminated employees and (b) permitted to continue allowing
employees to use vacation time as scheduled.
1 32 The direct charges to equity are due to secured debt reductions pursuant to
sales of two of Kevco Manufacturing, LP's operating divisions (Design Components
and Sunbelt Wood), as well as a direct cash payment of $15 million (see footnote
1,24). The secured debt owed to Bank of America by Kevco, Inc. (Case No.
401-40783-BJH-11) has been guaranteed by all of its co-debtors (see Footnote
1,27A); therefore, the secured debt is reflected as a liability on all of the
Kevco entities. The charge to equity is simply an adjustment to the balance
sheet. Kevco, Inc.'s report will reflect the cash portion of the transaction.
6 2 The Debtor is the lessee on hundreds of real and personal property leases, the
vast majority of which have been or will soon be rejected. The Debtor does not
isolate monthly payments due or paid on account of such leases. Instead, all
lease payments are reflected in the Debtor's accounts payable system. To
separately identify monthly accruals and payments on leases would require an
enormous outlay of the Debtor's accounting personnel and professionals. The
Debtor simply does not have available to it the resources that would be required
to provide the detail requested. If any party-in-interest desires specific
information about any specific lease, the Debtor will provide such information
upon request.
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