EXHIBIT 99.8
CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS
CASE NUMBER: 401-40789-BJH-11
JUDGE: BARBARA J. HOUSER
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF TEXAS
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FORT WORTH DIVISION
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MONTHLY OPERATING REPORT
MONTH ENDING: MARCH 31, 2002
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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/ WILFORD W. SIMPSON TREASURER
- --------------------------------------- --------------------------
Original Signature of Responsible Party Title
WILFORD W. SIMPSON APRIL 22, 2002
- --------------------------------------- --------------------------
Printed Name of Responsible Party Date
PREPARER:
/s/ DENNIS S. FAULKNER DEBTOR'S ACCOUNTANT
- --------------------------------------- --------------------------
Original Signature of Preparer Title
DENNIS S. FAULKNER APRIL 22, 2002
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Printed Name of Preparer Date
CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 1
CASE NUMBER: 401-40789-BJH-11
COMPARATIVE BALANCE SHEET
SCHEDULED MONTH MONTH MONTH
ASSETS AMOUNT JAN-02 FEB-02 MAR-02
- ------ ----------- ------------ ------------ ------------
1. Unrestricted Cash (FOOTNOTE) 41,421 0 0 0
2. Restricted Cash
3. Total Cash 41,421 0 0 0
4. Accounts Receivable-Net
(FOOTNOTE) 17,545,859 314,759 314,759 314,759
5. Inventory (FOOTNOTE) 27,611,039
6. Notes Receivable
7. Prepaid Rent 236,697
8. Other (Attach List) 303,392
9. Total Current Assets 45,738,408 314,759 314,759 314,759
10. Property, Plant & Equipment 22,049,500 9,739,582 9,739,582 9,739,582
11. Less: Accumulated
Depreciation/Depletion (6,151,901) (844,526) (844,526) (844,526)
12. Net Property, Plant & Equipment
(FOOTNOTE) 15,897,599 8,895,056 8,895,056 8,895,056
13. Due From Insiders
14. Other Assets - Net of Amortization
(Attach List) 5,741,869 481,876 481,876 481,876
15. Other (Attach List) 100,961,429 124,215,962 124,215,962 124,215,962
16. Total Assets 168,339,305 133,907,653 133,907,653 133,907,653
POST PETITION LIABILITIES
17. Accounts Payable
18. Taxes Payable (FOOTNOTE) 413,580 413,580 402,039
19. Notes Payable
20. Professional Fees
21. Secured Debt
22. Other (Attach List) (FOOTNOTE) 1,705,946 1,705,946 1,705,946
23. Total Post Petition Liabilities 2,119,526 2,119,526 2,107,985
PRE PETITION LIABILITIES
24. Secured Debt (FOOTNOTE) 75,885,064 13,509,318 13,590,741 13,680,889
25. Priority Debt (FOOTNOTE) 1,412,879
26. Unsecured Debt 19,966,456 18,555,081 18,555,081 18,555,081
27. Other (Attach List) 243,205,150 244,993,483 244,993,483 245,005,024
28. Total Pre Petition Liabilities 340,469,549 277,057,882 277,139,305 277,240,994
29. Total Liabilities 340,469,549 279,177,408 279,258,831 279,348,979
EQUITY
30. Pre Petition Owners' Equity (172,130,244) (172,130,244) (172,130,244)
31. Post Petition Cumulative Profit
Or (Loss) (33,710,908) (33,710,908) (33,710,908)
32. Direct Charges To Equity
(FOOTNOTE) 60,571,397 60,489,974 60,399,826
33. Total Equity (145,269,755) (145,351,178) (145,441,326)
34. Total Liabilities and Equity 133,907,653 133,907,653 133,907,653
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO DISTRIBUTION, LP SUPPLEMENT TO
CASE NUMBER: 401-40789-BJH-11 ACCRUAL BASIS - 1
COMPARATIVE BALANCE SHEET
SCHEDULED MONTH MONTH MONTH
ASSETS AMOUNT JAN-02 FEB-02 MAR-02
- ------ ----------- ------------ ------------ ------------
A. Inventory Vendor Deposit 130,000
B. Leased Facility Deposit 173,392
C.
D.
E.
TOTAL OTHER ASSETS - LINE 8 303,392 0 0 0
A. Goodwill: Shepherd Products 5,223,119
B. Goodwill: DARCO 518,750
C. Capitalized Lease 481,876 481,876 481,876
D.
E.
TOTAL OTHER ASSETS NET OF AMORTIZATION - LINE 14 5,741,869 481,876 481,876 481,876
A. Intercompany Receivables (FOOTNOTE) 100,961,429 124,215,962 124,215,962 124,215,962
B.
C.
D.
E.
TOTAL OTHER ASSETS - LINE 15 100,961,429 124,215,962 124,215,962 124,215,962
POST PETITION LIABILITIES
A. Accrued Liabilities 588,787 588,787 588,787
B. Long Term Leases 1,107,492 1,107,492 1,107,492
C. Accrued Interest: Bank 9,667 9,667 9,667
D.
E.
TOTAL OTHER POST PETITION LIABILITIES - LINE 22 1,705,946 1,705,946 1,705,946
PRE PETITION LIABILITIES
A. Interco. Payables (FOOTNOTE) 114,705,150 116,493,483 116,493,483 116,505,024
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 27 243,205,150 244,993,483 244,993,483 245,005,024
CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 2
CASE NUMBER: 401-40789-BJH-11
INCOME STATEMENT
MONTH MONTH MONTH QUARTER
REVENUES JAN-02 FEB-02 MAR-02 TOTAL
- -------- ------------ ------------ ------------ ------------
1. Gross Revenues
2. Less: Returns & Discounts
3. Net Revenue
COST OF GOODS SOLD
4. Material
5. Direct Labor
6. Direct Overhead
7. Total Cost Of Goods Sold
8. Gross Profit
OPERATING EXPENSES
9. Officer / Insider Compensation
10. Selling & Marketing
11. General & Administrative 3,900 0.00 0.00 3,900
12. Rent & Lease
13. Other (Attach List) 3,635 0.00 0.00 3,635
14. Total Operating Expenses 7,535 0.00 0.00 7,535
15. Income Before Non-Operating
Income & Expense (7,535) 0.00 0.00 (7,535)
OTHER INCOME & EXPENSES
16. Non-Operating Income (Att List) 2,133 0.00 0.00 2,133
17. Non-Operating Expense (Att List)
18. Interest Expense
19. Depreciation / Depletion
20. Amortization
21. Other (Attach List)
22. Net Other Income & Expenses 2,133 0.00 0.00 2,133
REORGANIZATION EXPENSES
23. Professional Fees
24. U.S. Trustee Fees
25. Other (Attach List)
26. Total Reorganization Expenses
27. Income Tax
28. Net Profit (Loss) (5,402) 0.00 0.00 (5,402)
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO DISTRIBUTION, LP SUPPLEMENT TO
CASE NUMBER: 401-40789-BJH-11 ACCRUAL BASIS - 2
INCOME STATEMENT
MONTH MONTH MONTH QUARTER
OPERATING EXPENSES JAN-02 FEB-02 MAR-02 TOTAL
- ------------------ ------------ ------------ ------------ ------------
A. Repairs & Maintenance 3,635 3,635
B.
C.
D.
E.
TOTAL OTHER OPERATING EXPENSES - LINE 13 3,635 3,635
OTHER INCOME & EXPENSES
A. Collection of Bad Debt 2,133 2,133
B.
C.
D.
E.
TOTAL NON-OPERATING INCOME - LINE 16 2,133 2,133
A.
B.
C.
D.
E.
TOTAL NON-OPERATING EXPENSE - LINE 17
A.
B.
C.
D.
E.
TOTAL OTHER EXPENSE - LINE 21 REORGANIZATION EXPENSES
A.
B.
C.
D.
E.
TOTAL OTHER REORGANIZATION
EXPENSES - LINE 25
CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 3
CASE NUMBER: 401-40789-BJH-11
CASH RECEIPTS AND MONTH MONTH MONTH QUARTER
DISBURSEMENTS JAN-02 FEB-02 MAR-02 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 DISTRIBUTION LP SUPPLEMENT TO ACCRUAL BASIS - 3
MARCH, 2002
CASE NUMBER: 401-40789-BJH-11 CASH RECEIPTS AND DISBURSEMENTS
DIST LP MFG MGMT HOLDING COMP KEVCO INC TOTAL
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1 CASH-BEGINNING OF MONTH -- 120,993 2,958,782 -- -- 1,000 3,080,775
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 -- --
7 SALE OF ASSETS -- --
8 OTHER -- 151 12,020 -- -- -- 12,171
INTERCOMPANY TRANSFERS 11,541 (10,553) 12 -- (1,000) --
SALE EXPENSE REIMBURSEMENT
INCOME TAX REFUND
RENT
PAYROLL TAX ADVANCE RETURNED
MISC. 8,036 --
INTEREST INCOME 151 3,984
9 TOTAL NON OPERATING RECEIPTS 11,541 (10,402) 12,032 -- -- (1,000) 12,171
10 TOTAL RECEIPTS 11,541 (10,402) 12,032 -- -- (1,000) 12,171
11 CASH AVAILABLE 11,541 110,591 2,970,814 -- -- -- 3,092,946
OPERATING DISBURSEMENTS
12 NET PAYROLL 17,547 17,547
13 PAYROLL TAXES PAID -- 7,695 7,695
14 SALES, USE & OTHER TAXES PAID 11,541 -- 11,541
15 SECURED/RENTAL/LEASES -- 3,214 3,214
16 UTILITIES -- 188 188
17 INSURANCE -- 98,810 98,810
18 INVENTORY PURCHASES -- --
19 VEHICLE EXPENSE -- --
20 TRAVEL -- --
21 ENTERTAINMENT -- --
22 REPAIRS & MAINTENANCE -- --
23 SUPPLIES -- --
24 ADVERTISING --
25 OTHER -- 9 796 -- -- -- 805
LOAN PAYMENTS -- -- --
FREIGHT -- --
CONTRACT LABOR -- 493 493
401 K PAYMENTS -- --
PAYROLL TAX ADVANCE ADP --
WAGE GARNISHMENTS --
MISC. 9 303 312
26 TOTAL OPERATING DISBURSEMENTS 11,541 9 128,250 -- -- -- 139,800
REORGANIZATION DISBURSEMENTS
27 PROFESSIONAL FEES -- 10,553 10,553
28 US TRUSTEE FEES -- --
29 OTHER --
30 TOTAL REORGANIZATION EXPENSE -- -- 10,553 -- -- -- 10,553
31 TOTAL DISBURSEMENTS 11,541 9 138,803 -- -- -- 150,353
32 NET CASH FLOW -- (10,411) (126,771) -- -- (1,000) (138,182)
33 CASH-END OF MONTH -- 110,582 2,832,011 -- -- -- 2,942,593
CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 4
CASE NUMBER: 401-40789-BJH-11
SCHEDULED MONTH MONTH MONTH
ACCOUNTS RECEIVABLE AGING AMOUNT JAN-02 FEB-02 MAR-02
- ------------------------- ----------- ---------- ---------- ----------
1. 0 - 30
2. 31 - 60
3. 61 - 90
4. 91 + 314,759 314,759 314,759
5. Total Accounts Receivable 17,545,859 314,759 314,759 314,759
6. (Amount Considered Uncollectible)
7. Accounts Receivable (Net) (Footnote) 17,545,859 314,759 314,759 314,759
AGING OF POST PETITION MONTH: MARCH-02
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) 402,039 402,039
5. Total Taxes Payable 402,039 402,039
6. Accounts Payable 0
STATUS OF POST PETITION TAXES MONTH: MARCH-02
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BEGINNING TAX AMOUNT WITHHELD ENDING TAX
FEDERAL LIABILITY* AND/OR ACCRUED (AMOUNT PAID) LIABILITY
- ------- ------------- --------------- ------------- ----------
1. Withholding**
2. FICA - Employee**
3. FICA - Employer**
4. Unemployment
5. Income
6. Other (Attach List)
7. Total Federal Taxes
STATE AND LOCAL
8. Withholding
9. Sales
10. Excise
11. Unemployment
12. Real Property (FOOTNOTE) 413,580 (11,541) 402,039
13. Personal Property
14. Other (Attach List)
15. Total State And Local 413,580 (11,541) 402,039
16. Total Taxes 413,580 (11,541) 402,039
* 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 DISTRIBUTION, LP ACCRUAL BASIS - 5
CASE NUMBER: 401-40789-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, etc. Accounts with restricted funds should be identified
by placing an asterisk next to the account number. Attach additional sheets if
necessary.
MONTH: MARCH-02
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BANK RECONCILIATIONS Account # 1 Account # 2
- -------------------- ----------- -----------
A. BANK: Other Accounts
B. ACCOUNT NUMBER: (Attach List) TOTAL
C. PURPOSE (TYPE):
1. Balance Per Bank Statement
2. Add: Total Deposits Not Credited
3. Subtract: Outstanding Checks
4. Other Reconciling Items
5. Month End Balance Per Books 0
6. Number of Last Check Written
INVESTMENT ACCOUNTS
DATE TYPE OF
BANK, ACCOUNT NAME & NUMBER OF PURCHASE INSTRUMENT PURCHASE PRICE CURRENT VALUE
- --------------------------- ----------- ---------- -------------- -------------
7.
8.
9.
10. (Attach List)
11. Total Investments 0
CASH
12. Currency On Hand 0
13. Total Cash - End of Month 0
This form does x does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 6
CASE NUMBER: 401-40789-BJH-11 MONTH MARCH-02
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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
TYPE OF AMOUNT TOTAL PAID
NAME PAYMENT PAID TO DATE
---- ------- ------ ----------
1. Martin, Steve Payroll 99,229
2. Martin, Steve Exp. Reimb. 1,390
3.
4.
5. (Attach List)
6. Total Payments To Insiders 100,619
PROFESSIONALS
DATE OF
COURT ORDER TOTAL
AUTHORIZING AMOUNT AMOUNT TOTAL PAID TO INCURRED
NAME PAYMENT APPROVED PAID 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
MONTHLY PAID
PAYMENTS DURING TOTAL UNPAID
NAME OF CREDITOR DUE MONTH POST PETITION
---------------- --------- -------- --------------
1. Bank of America 13,680,889
2. Leases Payable None
3.
4.
5. (Attach List)
6. TOTAL 13,680,889
This form does x does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO DISTRIBUTION, LP ACCRUAL BASIS - 7
CASE NUMBER: 401-40789-BJH-11
MONTH: MARCH-02
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QUESTIONNAIRE
YES NO
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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
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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
TYPE OF POLICY CARRIER PERIOD COVERED PAYMENT AMOUNT & FREQUENCY
-------------- ------- -------------------- --------------------------
Property, Auto, General Liability Aon Risk Services 3/1/02-9/1/02 Semi-Annual $ 98,598
D&O Liability Great American Insurance 11/1/2001-10/31/2004 Annual $ 64,657
This form x does does not have related footnotes on Footnotes Supplement.
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CASE NAME: KEVCO DISTRIBUTION, LP FOOTNOTES SUPPLEMENT
ACCRUAL BASIS
CASE NUMBER: 401-40789-BJH-11
MONTH: MARCH 31, 2002
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ACCRUAL
BASIS
FORM
NUMBER LINE NUMBER FOOTNOTE / EXPLANATION
- ------ ----------- ----------------------
1 1 Pursuant to the February 12, 2001 Order (1) Authorizing
3 1 Continued Use of 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.
1 4 As of July 2001, the remaining accounts receivable are for
4 7 commissions earned for the sale of consigned inventory.
Although collection is uncertain, Debtor will maintain
these receivables on the balance sheet until such time as
the likelihood of collection can be more accurately
determined.
1 5, 12 Pursuant to Asset Purchase Agreements approved by the Court
(see prior Monthly Operating Reports for details), Debtor
has sold most of its assets.
1 22 The Debtor records on its books accruals for certain
liabilities based on historical estimates. While 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 15A Intercompany receivables/payables are from/to co-debtors
1 27A Kevco Management Co. (Case No. 401-40788-BJH-11), Kevco
7 3 Manufacturing, LP (Case No. 401-40784-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 Property tax owing is an accrual only and not yet due.
4 12
1 24 The direct charges to equity are due to secured debt
1 32 reductions pursuant to sales of Kevco Manufacturing, LP's
operating divisions, the asset sale of the South Region of
Kevco Distribution, as well as direct cash payments. The
secured debt owed to Bank of America by Kevco, Inc. (Case
No. 401-40783-BJH) 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.
1 25 Pursuant to Order dated February 12, 2001 and Supplemental
Order dated March 14, 2001, debtors were authorized to pay
pre-petition 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.