1
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
MIDDLE DISTRICT OF TENNESSEE
In re: Case No.: 399-02649 THROUGH 399-02680
-----------------------------
SERVICE MERCHANDISE COMPANY, INC.
----------------------------------------------------------
Judge: PAINE
-----------------------------
Chapter 11
Debtor(s)
MONTHLY OPERATING REPORT FOR PERIOD ENDING August 26, 2001
-----------------------
COMES NOW, SERVICE MERCHANDISE COMPANY, INC.
-------------------------------------------
Debtor-In-Possession, and hereby submits its Monthly Operating Report for the period commencing July 30, 2001
and ending August 26, 2001 as shown by the report and exhibits consisting of 15 pages and containing
the following as indicated:
[ X ] Monthly Reporting Questionnaire (Attachment 1)
[ X ] Comparative Balance Sheets (Forms OPR-1 & OPR-2)
[N/A] Summary of Accounts Receivable (Form OPR-3)
[ X ] Schedule of Postpetition Liabilities (Form OPR-4)
[ X ] Statement of Income (Loss) (Form OPR-5)
I declare under penalty of perjury that this report and all the attachments are true and correct to
the best of my knowledge and belief. I also hereby certify that the original Monthly Operating Report was filed
with the Bankruptcy Court Clerk and a copy delivered to the U.S. Trustee.
Date: September 17, 2001 DEBTOR - IN - POSSESSION
-----------------------------------------
By: /s/ Kenneth A. Conway
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Name and Title: KENNETH A. CONWAY, VICE PRESIDENT AND CONTROLLER
------------------------------------------------
Address: 7100 SERVICE MERCHANDISE DRIVE
------------------------------------------------
BRENTWOOD, TENNESSEE 37027
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Telephone No: (615) 660-3340
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Note: Report subject to further verification and account reconciliation
procedures
Page 1
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
1. PAYROLL
WAGES TAXES
OFFICERS TITLE GROSS NET DUE PAID
-----------------------------------------------------------------------------------------------------------------------------------
S. CUSANO CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER $ 57,500.00 $ 37,046.62 $ 5,060.02 $ 15,180.08
JANE F. GILMARTIN PRESIDENT AND CHIEF MERCHANDISING OFFICER $196,399.10 $137,519.16 $ 3,387.76 $ 56,067.73
C. STEVEN MOORE SENIOR VICE PRESIDENT, CHIEF ADMINISTRATIVE OFFICER,
GENERAL COUNSEL AND SECRETARY $ 27,693.91 $ 18,919.02 $ 2,084.61 $ 6,476.98
MICHAEL E. HOGREFE SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER $ 23,847.83 $ 16,513.83 $ 1,724.39 $ 5,396.33
ERIC A. KOVATS SENIOR VICE PRESIDENT, STORES $ 21,924.71 $ 15,345.88 $ 1,451.54 $ 4,577.81
KARREN M. PRASIFKA VICE PRESIDENT, ASSISTANT GENERAL COUNSEL $ 17,509.00 $ 11,916.64 $ 1,322.47 $ 4,181.01
KENNETH A. CONWAY VICE PRESIDENT AND CONTROLLER $ 13,076.92 $ 9,687.60 $ 613.66 $ 1,840.98
JOE M. ELLIOTT VICE PRESIDENT, PROPERTY ADMINISTRATION $ 11,538.48 $ 7,990.34 $ 591.45 $ 1,774.36
KIMBERLY B. SOUTHARD ASSISTANT VICE PRESIDENT, STRATEGIC PLANNING AND
ASSISTANT TREASURER $ 8,846.16 $ 5,528.19 $ 629.72 $ 1,889.17
The following associate received a payment, in accordance with the terms of her employment agreement, that is included in the
amounts above.
JANE F. GILMARTIN $156,250.00
Page 2
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
2. INSURANCE
COVERAGE POLICY EXPIRATION PREMIUM DATE COVERAGE
TYPE NAME OF CARRIER AMOUNT NUMBER DATE AMOUNT PAID THROUGH
-----------------------------------------------------------------------------------------------------------------------------------
Property Fireman's Fund Insurance Co $5 Million 01MXI97600751 12/31/01 $685,000 12/31/01
Royal Indemnity Co. $5 Million RHD317182 12/31/01 $ 90,250 12/31/01
Westchester Fire $15 Million 1XA394430-0 12/31/01 $ 64,125 12/31/01
Allianz Insurance Co $12 Million CLP1036568 12/31/01 $ 26,583 12/31/01
TIG Insurance Co $13 Million XPT38844629 12/31/01 $ 28,730 12/31/01
Westchester Fire $20 Million 1XA394429-0 12/31/01 $ 13,500 12/31/01
Allianz Insurance Co $30 Million CLP1036568 12/31/01 $ 20,250 12/31/01
Allianz Insurance Co $25 Million CLP1036568 12/31/01 $ 8,500 12/31/01
Boiler & Machinery Hartford Steam Boiler $10 Million 4914359 12/31/01 $ 9,934 12/31/01
Transit Fireman's Fund Insurance Co $1 Million CCIMG72820 12/31/01 $ 10,000 12/31/01
Ocean Cargo Fireman's Fund Insurance Co $10 Million CR37211 12/31/01 $ 40,000 12/31/01
General Liability Ace American Ins Co $5 Million XSLG20577009 12/31/01 $212,279 12/31/01
Workers' Compensation Pacific Employers Ins Co Statutory WLRC43024516 12/31/01 $136,566 12/31/01
WC Excess Ace American Ins Co Statutory XWC014026 12/31/01 $ 12,108 12/31/01
WC Contractual Indemnity Illinois Union Insurance Co Statutory CTPG20577344 12/31/01 $ 20,500 12/31/01
Auto Pacific Employers Ins Co $1 Million ISAH07968358 12/31/01 $ 33,518 12/31/01
Umbrella Ohio Casualty Group $50 Million BXO52805120 12/31/01 $ 88,250 12/31/01
Excess Liability Zurich American of Illinois $50 Million AEC287610703 12/31/01 $ 30,000 12/31/01
International Ace American Ins Co $1 Million PHF051491 12/31/01 $ 2,500 12/31/01
Punitive Damages Magna Carta Ins. Ltd. $50 Million MCPD201058 12/31/01 $ 40,000 12/31/01
Punitive Damages - Excess Zurich Ins. Co Bermuda Branch $50 Million ZICBB-091 PD 12/31/01 $ 5,000 12/31/01
Directors & Officers Continental Insurance Co $10 Million 300714943 03/01/02 $200,000 03/01/02
Federal Insurance Co $10 Million 81278902-A 03/01/02 $190,000 03/01/02
Royal Insurance Co $10 Million PSF000009 03/01/02 $175,000 03/01/02
Greenwich Ins. Co. $10 Million ELU82217-01 03/01/02 $198,949 03/01/02
Zurich-American Ins. Co. $10 Million DOC3746468-00 03/01/02 $146,704 03/01/02
Kemper Insurance Co $10 Million 3DY00200100 03/01/02 $ 99,110 03/01/02
Crime National Union Fire Ins Co $10 Million 8726439 03/01/02 $ 53,833 03/01/02
Fiduciary National Union Fire Ins Co $10 Million 8726812 03/01/02 $ 25,839 03/01/02
Employment Practices Liability Chubb Insurance Co $5 Million 81278901A 03/01/02 $100,000 03/01/02
National Union Fire Ins Co $5 Million 8727499 03/01/02 $ 70,000 03/01/02
Royal Insurance Co $10 Million PSF000010 03/01/02 $ 85,000 03/01/02
Special Crime Reliance Insurance Co $25 Million NFK1951937 05/01/02 $ 13,458 05/01/02
Page 3
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
3. BANK ACCOUNTS
TOTAL CASH AND CASH EQUIVALENTS
CASH IN STORES AND HOME OFFICE
HOME OFFICE $ 4,950
RETAIL SAFE FUNDS 1,768,561
CORPORATE ACCOUNTS 1,998,744
STORE DEPOSITORY ACCOUNTS
FIRST TENNESSEE 465,061
KEY NATIONAL BANK 286,613
FLEET BOSTON 328,284
FIRST UNION 2,180,754
BANK ONE LOUISIANA 229,375
ABN - AMRO BANK 210,848
COMERICA BANK 121,714
AM SOUTH 239,745
BANK OF AMERICA 221,508
BANK OF OKLAHOMA 112,809
CHASE BANK OF TEXAS 618,309
SINGLE STORE DEPOSITORY ACCOUNTS 259,235
WELLS FARGO BANK 54,458
BANK ONE, IN 106,889
PNC BANK 420,760
OAK BROOK BANK 467,757
CREDIT CARD CASH ACCOUNTS (SALES PROCESSED BY CREDIT CARD COMPANY) 7,018,119
OTHER DEPOSITORY ACCOUNTS
SERVICE MERCHANDISE - MUSCULAR DYSTROPHY ASSOC. 76,755
OTHER CASH ACCOUNTS 9,026,503
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TOTAL CASH PER GENERAL LEDGER $26,217,752
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
RECEIPTS AND DISBURSEMENTS
(DOLLARS IN THOUSANDS)
ACTUAL ACTUAL ACTUAL ACTUAL TOTAL
Monday 07/30/01 08/06/01 08/13/01 08/20/01 07/30/01
Sunday 08/05/01 08/12/01 08/19/01 08/26/01 08/26/01
-------- -------- -------- -------- --------
Receipts:
Sales receipts $ 13,459 $ 15,959 $ 13,561 $ 15,671 $ 58,650
Miscellaneous receipts -- 2,115 283 141 2,539
-------- -------- -------- -------- --------
Total available collections 13,459 18,074 13,844 15,812 61,189
Disbursements:
Merchandise disbursements 6,527 5,609 7,677 5,288 25,101
Non-merchandise disbursements 10,816 10,154 9,539 9,588 40,097
-------- -------- -------- -------- --------
Total disbursements 17,343 15,763 17,216 14,876 65,198
-------- -------- -------- -------- --------
Net receipts/(disbursements) $ (3,884) $ 2,311 $ (3,372) $ 936 $ (4,009)
======== ======== ======== ======== ========
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
ROLLING REVISED CASH FLOW FORECAST
(DOLLARS IN THOUSANDS)
ACTUAL ACTUAL FORECAST FORECAST FORECAST
08/26/01 09/09/01 09/30/01 10/28/01 11/25/01
-------- -------- -------- -------- --------
Ending total revolver balance $188,014 $196,616 $211,663 $270,780 $328,846
Term loan 60,000 60,000 60,000 60,000 60,000
Standby letters of credit 24,335 23,729 23,729 23,572 24,416
Trade letters of credit 45,867 42,037 42,562 27,416 21,640
-------- -------- -------- -------- --------
Total extensions of credit 318,216 322,382 337,954 381,768 434,902
Borrowing base 408,292 440,198 448,286 507,323 537,883
-------- -------- -------- -------- --------
Availability $ 90,076 $117,816 $110,332 $125,555 $102,981
======== ======== ======== ======== ========
Page 6
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
4. PAYMENTS TO PROFESSIONALS JULY 30, 2001 THROUGH AUGUST 26, 2001
Vendor # Vendor Name Check Amt. Check Date Check #
-------------------------------------------------------------------------------------------------------------------------------
57117 Deloitte and Touche $ 18,000.00 07/31/01 50049064
57117 Deloitte and Touche $ 26,318.62 07/31/01 50049100
99454 Harwell, Howard, Hyne, Gabbert, and Manner, PC $ 12,896.95 07/31/01 B0025373
71217 Bass, Berry and Sims $180,395.96 07/31/01 B0025375
99391 Otterbourg, Steindler, Houston and Rosen, PC $102,065.01 07/31/01 B0025376
50995 Brann and Isaacson $ 71.21 08/01/01 50049317
57117 Deloitte and Touche $ 18,959.00 08/01/01 50049318
99459 Robert L. Berger and Associates $ 14,198.71 08/01/01 B0025396
57117 Deloitte and Touche $ 4,911.00 08/02/01 50049431
2642 Waller, Lansden, Dortch and Davis $ 21,370.99 08/02/01 70001138
57117 Deloitte and Touche $ 55,296.00 08/06/01 50049581
57117 Deloitte and Touche $ 34,176.00 08/07/01 50049726
40443 Robert J. Bard, Esq. $ 5,000.00 08/13/01 50050142
48779 Loss, Pavone and Orel $ 50.52 08/13/01 50050143
67017 Barkley and Thompson $ 5,091.73 08/13/01 50050145
86237 Brusniak, Clement, Harrison and McCool, PC $ 1,367.98 08/13/01 50050147
80443 Coudert Brothers $ 878.99 08/14/01 50050214
44013 McCarter and English $ 5,963.95 08/14/01 50050261
48779 Loss, Pavone and Orel $ 375.00 08/14/01 50050263
67017 Barkley and Thompson $ 5,637.35 08/14/01 50050264
95912 Kightlinger and Gray $ 389.50 08/14/01 50050268
95912 Kightlinger and Gray $ 3.80 08/14/01 50050269
96684 Sherbow and Mitchell $ 5,000.00 08/14/01 50050270
44013 McCarter and English $ 579.58 08/15/01 50050393
101606 Service Real Estate Venture $ 45,602.00 08/15/01 B0025463
101606 Service Real Estate Venture $ 93,000.00 08/15/01 B0025464
101606 Service Real Estate Venture $ 45,822.00 08/15/01 B0025465
71217 Bass, Berry and Sims $160,029.94 08/15/01 B0025469
98378 Skadden, Arps, Slate, Meagher and Flom $390,064.00 08/15/01 B0025470
99104 Jay Alix and Associates $ 10,686.12 08/15/01 B0025471
44013 McCarter and English $ 11,152.66 08/20/01 50050786
57117 Deloitte and Touche $ 11,000.00 08/20/01 50050788
57117 Deloitte and Touche $ 68,950.00 08/22/01 50050958
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FORM OPR - 1 AND 2
SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(DEBTOR - IN - POSSESSION)
(IN THOUSANDS)
AUGUST 26, JULY 29,
2001 2001
---------- --------
ASSETS
Current Assets:
Cash and cash equivalents $ 26,218 $ 19,368
Accounts receivable 6,670 6,644
Inventories 425,960 417,795
Prepaid Expenses 10,969 11,179
-------- --------
TOTAL CURRENT ASSETS 469,817 454,986
-------- --------
PROPERTY AND EQUIPMENT
Owned assets, net of accumulated depreciation 348,404 351,614
Capitalized leases, net of accumulated amortization 10,910 11,074
-------- --------
TOTAL PROPERTY AND EQUIPMENT 359,314 362,688
-------- --------
Other assets and deferred charges 38,482 40,612
-------- --------
TOTAL ASSETS $867,613 $858,286
======== ========
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Liabilities Not Subject To Compromise Current Liabilities:
Notes payable to banks $188,014 $185,003
Accounts payable 45,650 25,624
Accrued expenses 107,016 122,493
State & local sales tax 8,435 8,570
Current maturities capitalized leases 99 98
-------- --------
TOTAL CURRENT LIABILITIES 349,214 341,788
-------- --------
Page 8
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FORM OPR - 1 AND 2
SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(DEBTOR - IN - POSSESSION)
(IN THOUSANDS)
AUGUST 26, JULY 29,
2001 2001
------------ ------------
Long-Term Liabilities:
Long-term debt 60,000 60,000
Capitalized lease obligations 2,329 2,338
Liabilities Subject To Compromise:
Accrued restructuring costs 42,077 42,077
Capitalized lease obligations 20,040 20,310
Long-term debt 409,138 410,622
Accounts payable 198,749 198,651
Accrued expenses 75,270 74,420
------------ ------------
Total Liabilities Subject To Compromise 745,274 746,080
TOTAL LIABILITIES 1,156,817 1,150,206
------------ ------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' (DEFICIT) EQUITY
Common stock 49,935 49,935
Additional paid-in-capital 5,881 5,881
Deferred compensation (137) (146)
Accumulated other comprehensive loss (2,545) (2,545)
Retained (deficit) earnings (342,338) (345,045)
------------ ------------
TOTAL SHAREHOLDERS' (DEFICIT) EQUITY (289,204) (291,920)
TOTAL LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY $ 867,613 $ 858,286
============ ============
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CHAPTER 11
MONTHLY OPERATING REPORT
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
SUMMARY OF ACCOUNTS RECEIVABLE
MONTH ENDED: AUGUST 26, 2001
FORM OPR-3 NOT APPLICABLE
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET.AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
SCHEDULE OF POST PETITION LIABILITIES-ACCOUNTS PAYABLE
MONTH ENDED: 08/26/2001
FORM OPR-4
Total
--------
Trade Accounts Payable (Merchandise) $ 45,650
Total
--------
Expense & other payables $107,016
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
SCHEDULE OF POST PETITION LIABILITIES
FORM OPR-4
(DOLLARS IN THOUSANDS)
Date Date Total
TAXES PAYABLE Incurred Due Due
Federal income tax ** Various Various $ 7,919
State income tax Various Various (559)
-------
SUBTOTAL $ 7,360
-------
Sales/use tax SUBTOTAL * Various Various $ 9,141
-------
Personal property tax * Various Various $ 2,985
Real estate taxes * Various Various 12,140
Inventory taxes * Various Various --
Gross receipts/bus licenses * Various Various 229
Franchise taxes * Various Various 548
-------
SUBTOTAL $15,902
-------
TOTAL TAXES PAYABLE $32,403
=======
* liability included in accrued expenses on OPR-2
** tax reserve
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CHAPTER 11
MONTHLY OPERATING REPORT
MONTHLY REPORTING QUESTIONNAIRE
CASE NAME: SERVICE MERCHANDISE COMPANY, INC. ET. AL.
CASE NUMBER: 399-02649 THROUGH 399-02680
PERIOD: JULY 30, 2001 THROUGH AUGUST 26, 2001
SCHEDULE OF POST PETITION LIABILITIES
FORM OPR-4
(DOLLARS IN THOUSANDS)
DATE TOTAL DUE
INCURRED DATE DUE (8/26/01 BALANCE)
------------------------------------------------------
POST PETITION SECURED DEBT
Revolver borrowings 04/14/00 04/14/04 $ 188,014
Facility standby letters of credit 04/14/00 04/14/04 24,335
Facility trade letters of credit 04/14/00 04/14/04 45,867
Term loans 04/14/00 04/14/04 60,000
---------
TOTAL EXTENSIONS OF CREDIT $ 318,216
=========
ACCRUED INTEREST PAYABLE $ 656
=========
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FORM OPR-5 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(DEBTOR-IN-POSSESSION)
(IN THOUSANDS)
<Table>
<Caption>
ACTIVITY ACTIVITY ACTIVITY YTD ACTIVITY YTD
JULY 30, 2001 JULY 31, 2000 JANUARY 1, 2001 JANUARY 3, 2000
THROUGH THROUGH THROUGH THROUGH
AUGUST 26, 2001 AUGUST 27, 2000 AUGUST 26, 2001 AUGUST 27, 2000
--------------- --------------- --------------- ---------------
Net Sales $ 54,068 $ 90,609 $ 572,297 $ 951,774
Costs of merchandise sold and buying and
occupancy expense 45,434 79,044 420,259 758,093
--------- ----------- --------- ---------
Gross margin after cost of merchandise
sold and buying and occupancy expenses 8,634 11,565 152,038 193,681
Selling, General and Administrative Expenses:
Net Employment Expense 11,904 20,595 110,338 199,225
Net Advertising 1,271 2,372 37,836 45,438
Banking and Other Fees 3,270 1,274 10,936 13,589
Real Estate and Other Taxes 1,714 1,870 15,095 15,273
Supplies 904 788 4,969 7,124
Communication and Equipment 314 348 2,558 3,164
Travel 272 612 2,594 4,093
UCC and Other Services (154) (224) (2,608) (6,329)
Legal and Professional 339 340 2,753 2,497
Sales and Shipping 39 89 809 929
Insurance 400 491 3,353 3,066
Miscellaneous (18) 257 411 290
Credit Card Services (21,731)(a) (55) (22,027) (394)
--------- ----------- --------- ---------
Total Selling, General and Administrative Expenses (1,476) 28,757 167,017 287,965
Other expense/(income), net (8) (840) 1,392 (14,777)
</Table>
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FORM OPR-5 SERVICE MERCHANDISE COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(DEBTOR-IN-POSSESSION)
(IN THOUSANDS)
<Table>
<Caption>
ACTIVITY ACTIVITY ACTIVITY YTD ACTIVITY YTD
JULY 30, 2001 JULY 31, 2000 JANUARY 1, 2001 JANUARY 3, 2000
THROUGH THROUGH THROUGH THROUGH
AUGUST 26, 2001 AUGUST 27, 2000 AUGUST 26, 2001 AUGUST 27, 2000
--------------- --------------- --------------- ---------------
Restructuring charge (credit) -- (694) -- (2,524)
Depreciation and amortization 3,058 2,975 27,110 25,739
------ -------- -------- ---------
Earnings (loss) before interest, reorganization items,
and income tax 7,060 (18,633) (43,481) (102,722)
Interest expense -- debt 2,828 2,470 24,959 23,651
Interest expense -- capitalized leases 253 367 2,111 2,404
------ -------- -------- ---------
Earnings (loss) before reorganization items, and income
tax 3,979 (21,470) (70,551) (128,777)
Reorganization Items:
Severance -- -- -- 9,423
Legal and Professional 1,073 2,193 16,536 27,684
Miscellaneous 219 257 1,863 1,893
Loss (Gain) on Disposal of Assets (20) 3,555 1,027 3,774
Close Store Charges -- (111) 21 (261)
------ -------- -------- ---------
Total Reorganization Items 1,272 5,894 19,447 42,513
Earnings (loss) before income tax 2,707 (27,364) (89,998) (171,290)
Income tax benefit -- -- -- --
Cumulative Effect of Change in
Accounting Principles -- -- -- --
------ -------- -------- ---------
Net earnings (loss) $2,707 $(27,364) $(89,998) $(171,290)
====== ======== ======== =========
</Table>
Notes:
(a) Primarily a result of reversals of loss reserves due to the settlement of
the World Financial Network National Bank ("WFNNB") matter.
Page 15