EXHIBIT 99.2
UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
In Re: NxNetworks, Inc. Chapter 11
Debtor(s) Case Number: 01-14233
----------
MONTHLY OPERATING REPORT
CALENDAR MONTH MAY 1, 2002 TO MAY 31, 2002
---------------------------
FINANCIAL BACKGROUND INFORMATION
1. ACCOUNTING BASIS: Cash Accrual X
------ ----
2. PREPARER: State the name, address, telephone number and position of the
person(s) who actually compiled the information contained in this report.
Location: NxNetworks, Inc. 13595 Dulles Technology Drive, Herndon, VA
20171; Greg Washenko (CFO) 703-793-2059 and Jennifer Bell (Controller)
703-793-2076
3. NUMBER OF EMPLOYEES paid during this period: 2
----
4. Have there been any CHANGES IN THE NATURE OF YOUR BUSINESS since the last
reporting period?
Yes / / No /X/. If yes, explain below:
5. Are all BUSINESS LICENSES current? Yes /X/ No / / Not Applicable/ /
6. PRE-PETITION ACCOUNTS RECEIVABLE:
Beginning Balance $ 0
Collected this Period $
Write-offs against allowance
Sale of asset $ 0
Ending Balance $ 0
7. POST-PETITION ACCOUNTS RECEIVABLE:
0-30 Days: $0 31-60 Days: $0 Over 61-90: $0 Days over 90: $0
-- -- -- ---
If there are any post-petition Accounts Receivable over 60 days, provide
schedule AR giving a listing of such accounts and explain the delinquencies.
8. POST-PETITION ACCOUNTS PAYABLE:
0-30 Days: $3,953 31-60 Days: $236 Over 60 Days: $215,989
------ ---- --------
If there are any post-petition Accounts Payable over 30 days, provide Schedule
AP giving a listing of such accounts and explain the delinquencies.
9. TAXES. Are all taxes being paid to the proper taxing authorities when due?
Yes /X/ No / / Payroll tax is current but sales, property and business taxes
are overdue. 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.
10. ESCROW ACCOUNTS. Are you utilizing your tax account only for deposits and
payment of payroll and sales taxes?
Yes /X/ No / /. If no, explain: .
------
11. Are all BOOKS AND RECORDS of the debtor(s) being maintained monthly and are
all current? Yes /X/ No / / Explain:
12. INSURANCE EXPIRATION STATEMENT. Policy expiration dates are:
Auto & Truck 4/01/02 Liability 4/01/02
------ -------
Fire Workers Comp. 4/01/02
------------------- -------
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 control or custody of any asset of the estate? Yes/ / No/ /
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/ 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)?
Yes /X/ No / / Explain: On March 6, 2002, the US Bankruptcy Court for the
Eastern District of Virginia issued an order in which it approved the sale of
substantially all of Nx Networks' assets to NSGData.com pursuant to section 363
of the US Bankruptcy code.
15. PAYMENTS TO SECURED CREDITORS during reporting period:
(Attach additional sheets, if necessary.)
- -----------------------------------------------------------------------------------------------------------------
Creditor Freq. Of Payments per Amount Next Post Petition
Contract (mo, qtr) of Each Payment Pmts. not made
Payment Due No. Amt.
- -----------------------------------------------------------------------------------------------------------------
None
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
16. PAYMENTS TO PROFESSIONALS (Attorneys, Accountants, Real Estate Agents,
Auctioneers, Appraisers, etc., during reporting period: (Attach additional
sheets, if necessary.)
---------------------------------------------------------------------------
Professional Service Amount
---------------------------------------------------------------------------
Richard Yalen CEO $2,000.00
---------------------------------------------------------------------------
---------------------------------------------------------------------------
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: 6/14/02 DEBTOR-IN-POSSESSION
Name/Title: Rich Yalen By:
---------------------------------------- -------------------
Address: 13595 Dulles Technology Drive
----------------------------------------
Herndon, VA 20171 Phone:
---------------------------------------- -------------------
UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
In Re: Chapter 11
Debtor(s) Case Number: __________
MONTHLY OPERATING REPORT
INCOME STATEMENT
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH APRIL 1 TO APRIL 30, 2002
(All figures refer to post-petition transactions)
THIS MONTH YEAR TO DATE
(A) TOTAL SALES/INCOME (A) ___________ ___________ SEE ATTACHED
COST OF SALES
Beginning Inventory ___________ ___________
Purchases of Inventory ___________ ___________
Less Ending Inventory (___________) (___________)
Direct Labor (Gross Salaries) ___________ ___________
Purchased Services ___________ ___________
(B) TOTAL COST OF SALES (B) ___________ ___________
(C) GROSS PROFIT (C = A - B) ___________ ___________
OPERATING EXPENSES
Officer Salaries (Gross) ___________ ___________
Other Employee Salaries (Gross) ___________ ___________
Taxes (Payroll: Employer's Share) ___________ ___________
Employee Benefits (Insurance, Pension
Plan, etc. Employer's Share)
Advertising ___________ ___________
Bad Debts ___________ ___________
Depreciation and Amortization ___________ ___________
Entertainment ___________ ___________
Insurance (Real Estate) ___________ ___________
Insurance (Other) ___________ ___________
Interest (Mortgage, Loans, etc.) ___________ ___________
Leases (other than Rent) ___________ ___________
Outside Services & Contractors ___________ ___________
Professional Fees (Attorney, Accountant)
___________ ___________
Rent and leases ___________ ___________
Repairs & Maintenance ___________ ___________
Supplies ___________ ___________
Taxes (Real Property) ___________ ___________
Taxes (Other) ___________ ___________
Telephone ___________ ___________
Travel ___________ ___________
Utilities ___________ ___________
U.S. Trustee Quarterly Fee ___________ ___________
CASE NUMBER: _____________ PERIOD ENDED: ___________ INCOME STATEMENT PAGE 2
THIS MONTH YEAR TO DATE
OTHER OPERATING EXPENSES
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
(D)TOTAL OPERATING EXPENSES (D) ____________ ___________
(E) PROFIT/LOSS FROM OPERATIONS (E=C-D) ____________ ___________
OTHER INCOME (EXPENSES) ____________ ___________
Interest Income ____________ ___________
Interest Exp (____________) (___________)
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
EXTRAORDINARY ITEMS- In (Out)
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
_________________________________________ ____________ ___________
(F) TOTAL OTHER INCOME/EXPENSE &
EXTRAORDINARY ITEMS (F) ____________ ___________
(G) INCOME BEFORE TAXES (G = E+F) ____________ ___________
(H) INCOME TAX EXPENSE (H) ____________ ___________
(I) NET INCOME (LOSS)(I = G - H) ____________ ___________
NOTE: Accrual basis reporters must attach Cash Reconciliation Reports or a
standard Statement of Sources and Uses of Cash to this Report.
In Re: ______________________ Case Number___________
CASH RECONCILIATION REPORT
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH ENDING APRIL 30, 2002
(All figures refer to post-petition transactions)
OPERATING TOTALS
ACCOUNT
(A) BEGINNING CASH BALANCE (A) _________ SEE ATTACHED
(B) NET INCOME, (LINE (I), PAGE 23) (B) _________ _________
Add Expenses Not Requiring Cash:
Depreciation _________
____________________________ _________
____________________________ _________
(C) SUB-TOTAL (C) _________ _________
(D) CASH FROM OPERATIONS (D = B + C) _________ _________
OTHER SOURCES (USES) OF CASH:
SOURCES (USES)
- ------- ----
Decrease (Incr) - Accounts Receivable __________
Decrease (Incr) - Inventory __________
Decrease (Incr) - Equipment __________
Decrease (Incr) - Furniture & Fixtures __________
Decrease (Incr) - _________________ __________
Decrease (Incr) - _________________ __________
Increase (Decr) - Accounts Payable __________
Increase (Decr) - Accrued Interest __________
Increase (Decr) - Accrued P/R Taxes __________
Increase (Decr) - Accrued Prof. Fees __________
Increase (Decr) - Accrued Rent __________
Increase (Decr) - Accrued Salaries __________
Increase (Decr) - Accrued Sales Taxes __________
Increase (Decr) - Notes Payable -Banks __________
Increase (Decr) - Notes Payable -Other __________
Increase (Decr) - ____________________ __________
Increase (Decr) - ____________________ __________
(Less) Unrecorded bank service charges __________
(E) TOTAL OTHER SOURCES (USES) OF CASH (E) __________ __________
(F) ENDING CASH BALANCE (F = A+D+E) __________ __________
(G) BALANCE PER BANK STATEMENT* (G) __________
(H) LESS OUTSTANDING CHECKS (H) __________
(I) ADD DEPOSITS IN TRANSIT (I) __________
(J) RECONCILED BANK BALANCE {J=(G-H)+I} __________
Ending Cash Balance(F) and Reconciled Bank Balance(J) should equal.
- ------------------------------------------------------------------
In Re: ______________________ Case Number___________
CASH RECONCILIATION REPORT
PAYROLL AND TAX ACCOUNTS
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH ENDING _____________
(All figures refer to post-petition transactions)
PAYROLL TAX
ACCOUNT ACCOUNT
(A) BEGINNING CASH BALANCE (A) __________ _________
CASH RECEIPTS:
Transfers from Operating Account __________ ________
Transfers from Payroll Account __________
Other - ________________________ __________ ________
(B) TOTAL CASH RECEIPTS (B) __________ ________
(C) CASH AVAILABLE (C = A + B) __________ ________
CASH DISBURSEMENTS:
Gross Payroll for this period $ ___________
Employee Benefits paid ____________
Net Payroll Paid ____________
Transfers to Tax Account ____________
Taxes deposited or paid during period
Employees' share of FICA Tax __________ ________
Employer's share of FICA Tax __________ ________
Employees' Federal Income Tax __________ ________
Employees' State Income Tax __________ ________
Unemployment Tax __________ ________
Unrecorded Bank Service Charges __________ ________
Other: _________________ __________ ________
(D) TOTAL DISBURSEMENTS (D) __________ ________
(E) ENDING CASH BALANCE (E = C-D) __________ ________
(F) BALANCE PER BANK STATEMENT(S)* (F) __________ ________
(G) LESS OUTSTANDING CHECKS (G) __________ ________
(H) ADD DEPOSITS IN TRANSIT (H) __________ ________
(I) RECONCILED BANK BALANCE {I =(F-G)+H}
__________ ________
Ending Cash Balance(E) and Reconciled Bank Balance(I) should equal.
- -------------------------------------------------------------------
IN RE: CASE NUMBER _____________
BALANCE SHEET
AS OF __________________
CURRENT ASSETS
Cash $____________ SEE ATTACHED
Pre-Petition Accounts Receivable ____________
Post-Petition Accounts Receivable ____________
Receivable from Officers,
Employees, Affiliates ____________
Notes Receivable ____________
Inventory ____________
Other Current Assets:
_______________________________________ ____________
_______________________________________ ____________
TOTAL CURRENT ASSETS ____________
FIXED ASSETS
Land ____________
Buildings ____________
Equipment, Furniture & Fixtures ____________
less Accumulated Depreciation (__________)
TOTAL FIXED ASSETS ____________
OTHER ASSETS
______________________________________ ____________
______________________________________ ____________
______________________________________ ____________
TOTAL OTHER ASSETS ____________
TOTAL ASSETS ____________
POST-PETITION LIABILITIES
Accounts Payable ____________
Notes Payable ____________
Rents and Leases Payable ____________
Taxes Payable ____________
Accrued Interest ____________
______________________________________ ____________
TOTAL-POST PETITION LIABILITIES ____________
PRE-PETITION LIABILITIES
Priority Claims ____________
Secured Debts ____________
Unsecured Debt ____________
TOTAL PRE-PETITION LIABILITIES ____________
OWNERS EQUITY (DEFICIT)
Capital Stock or Owners Investment
____________
Paid In Capital Surplus ____________
Retained Earnings (Deficit)
Pre -Petition ____________
Post-Petition ____________
TOTAL OWNERS EQUITY ____________
TOTAL LIABILITIES AND OWNER'S EQUITY ____________
UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
In Re: )
) Chapter 11
) Case Number:__01-14223___
)
Debtor(s) )
- ------------------------------------
CASH DISBURSEMENTS SUMMARY REPORT
Calendar Month Ending May 31, 2002
Total Disbursements from Operating Account
(See Note 1) $37,615.36
----------
Total Disbursements from Payroll Account
(See Note 2) $17,998.95
----------
*One tax payment made from this account
Total Disbursements from Tax Escrow Account
(See Note 3) $6,970.69
---------
Total Disbursements from any other Account
(See Note 4) 0
----------
Grand Total Disbursements from all Accounts $62,585.00
----------
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 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.)
ATTACH A COPY OF THE MOST RECENT MONTHLY BANK STATEMENT FOR EACH
DEBTOR-IN-POSSESSION ACCOUNT. (THE PAGE OF THE STATEMENT SHOWING BANK, ACCOUNT
NUMBER AND BEGINNING AND ENDING BALANCE IS SUFFICIENT.)
In Re: _________________________________ Case Number _______________
ACCOUNTS RECEIVABLE
AS OF APRIL 30, 2002
TOTAL DATE PAST DUE PAST DUE
CREDITOR DUE INCURRED (31-60 DAYS) (OVER 60 DAYS)
NONE
________ ________ _________
TOTALS THIS
PAGE
________ ________ _________
TOTALS ALL
PAGES
In Re: ___________________________ Case Number _______
ACCOUNTS PAYABLE
AS OF __________________
TOTAL DATE PAST DUE PAST DUE
CREDITOR DUE INCURRED (31-60 DAYS) (OVER 60 DAYS)
SEE ATTACHED
________ ________ _________
TOTALS THIS
PAGE
________ ________ _________
TOTALS ALL
PAGES
UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
In Re: Chapter 11
Case Number _________
Debtor(s)
MONTHLY OPERATING REPORT
INCOME STATEMENT
(BUSINESS DEBTOR, CASH BASIS)
CALENDAR MONTH __________ TO __________
(All figures refer to post-petition transactions)
THIS MONTH YEAR TO DATE
(A) TOTAL SALES/INCOME (A) ___________ ___________
COST OF SALES
Purchases of Inventory ___________ ___________
Purchased Services ___________ ___________
_______________________ ___________ ___________
_______________________ ___________ ___________
(B) TOTAL COST OF SALES (B) ___________ ___________
(C) GROSS PROFIT (C = A - B) ___________ ___________
OPERATING EXPENSES
Officer Salaries (Gross) ___________ ___________
Other Employee Salaries (Gross) ___________ ___________
Taxes (Payroll: Employer's Share) ___________ ___________
Employee Benefits (Insurance, Pension
Plan, etc. Employer's Share)
Advertising ___________ ___________
Automobile Expenses ___________ ___________
Entertainment ___________ ___________
Insurance (Real Estate) ___________ ___________
Insurance (Other) ___________ ___________
Interest ___________ ___________
Leases (other than Rent) ___________ ___________
Outside Services & Contractors ___________ ___________
Professional Fees (Attorney, Accountant)
___________ ___________
Rent ___________ ___________
Repairs & Maintenance ___________ ___________
Supplies ___________ ___________
Taxes (Real Property) ___________ ___________
Taxes (Other) ___________ ___________
Telephone ___________ ___________
Travel ___________ ___________
Utilities ___________ ___________
U.S. Trustee Quarterly Fee ___________ ___________
THIS MONTH YEAR TO DATE
OTHER OPERATING EXPENSES
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
(D)TOTAL OPERATING EXPENSES (D) ___________ ___________
(E) PROFIT/LOSS FROM OPERATIONS (E=C-D) ___________ ___________
OTHER INCOME (EXPENSES)
Interest
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
(F) TOTAL OTHER INCOME/EXPENSE (F) ___________ ___________
(G) INCOME BEFORE TAXES (G=E+F) ___________ ___________
(H) INCOME TAX EXPENSE (H) ___________ ___________
(I) NET INCOME (LOSS) (I = G-H) ___________ ___________
EXTRAORDINARY ITEMS
Loans Received ___________ ___________
Note Principal (Paid) ___________ ___________
Capital (Purchases) ___________ ___________
(Less) Unrecorded Bank Svc. Chg. ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
_________________________ ___________ ___________
(J) TOTAL EXTRAORDINARY ITEMS (J) ___________ ___________
(K) CASH FORWARD FROM PRIOR PERIOD (K) __________ ___________
(L) ENDING CASH BALANCE (L = I+J+K) __________ ___________
(M) BALANCE PER BANK STATEMENT(S)* (M) __________ ___________
(N) LESS OUTSTANDING CHECKS (N) __________ ___________
(O) ADD DEPOSITS IN TRANSIT (O) __________ ___________
(P) RECONCILED BANK BALANCE {P=(M-N)+O} __________ ___________
Ending Cash Balance(L) and Reconciled Bank Balance(P) should equal.
- -------------------------------------------------------------------
UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
In Re: ) Chapter 11
)
) Case Number __________
Debtor(s) )
- ----------------------------------
MONTHLY OPERATING REPORT
INCOME STATEMENT
(NON-BUSINESS DEBTOR, CASH BASIS)
CALENDAR MONTH __________ TO __________
(All figures refer to post-petition transactions)
THIS MONTH
INCOME
Salary, Wages, etc. ___________
Interest, dividends, investments ___________
Business income(Rents, Royalties,
Sale of Assets, etc.) ___________
Other: ________________________ ___________
(A) TOTAL INCOME (A) ___________
EXPENSES
Automobile
Car payment ___________
Insurance ___________
Other ___________
Housing
Mortgage payment ___________
Insurance ___________
Real estate tax ___________
Rent ___________
Utilities ___________
Insurance (Other) ___________
Interest ___________
Medical ___________
Personal Living Expenses ___________
Professional Fees (Attorney, Acct.,etc) ___________
Taxes (Other) ___________
_________________________ ___________
_________________________ ___________
(B) TOTAL EXPENSES (B) ___________
(C) CASH FLOW (C = A-B) ___________
(D) CASH FORWARD FROM PRIOR PERIOD (D) ___________
(E) ENDING CASH BALANCE (E = D+C) ___________
(F) BALANCE PER BANK STATEMENT(S)* (F) ___________
(G) LESS OUTSTANDING CHECKS (G) ___________
(H) ADD DEPOSITS IN TRANSIT (H) ___________
(I) RECONCILED BANK BALANCE {I=(F-G)+H} ___________
Ending Cash Balance(E) and Reconciled Bank Balance(I) should equal.
- -------------------------------------------------------------------
NXNETWORKS, INC.
CONDENSED CONSOLIDATED BALANCE SHEET - UNAUDITED
AS OF MAY 31, 2002
ASSETS
------
MAY
CURRENT ASSETS
Cash and cash equivalents 1,492,789
Prepaids 249,259
Note Receivable 150,000
Other Receivable 94,159
-------------
Total Current Assets 1,986,207
OTHER ASSETS
Deposits 355,520
-------------
TOTAL ASSETS 2,341,727
=============
LIABILITIES & STOCKHOLDER'S EQUITY
POST-PETITION LIABILITIES:
Accounts Payable 220,179
Accrued Accounts Payable 273,268
Accrued liability for sub liquidation 338,031
Deferred Revenue
--
Taxes Payable 2,149
-------------
Total Post-Petition Liabilities 833,626
PRE-PETITION LIABILITIES:
Priority Claims 528,076
Secured Claims 558,735
Unsecured Claims 13,088,400
General pre-petition accruals 4,514,989
Total Pre-Petition Liabilities 18,690,201
-------------
TOTAL LIABILITIES 19,523,827
=============
STOCKHOLDERS' EQUITY:
Common Stock 2,430,230
Preferred Stock 7,025,008
APIC, net of filing fees 283,967,334
Deferred Compensation (2,347,751)
Accumulated (deficit)/income - Pre-petition (291,148,351)
Accumulated (deficit)/income-Post-petition PY (18,977,497)
Accumulated (deficit)/income-Post-petition CY (3,320,911)
Warrants 6,322,333
Notes Receivable from officer (1,000,000)
Cumulative Translation Adj. (132,495)
Total Stockholders' equity (17,182,100)
-------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 2,341,727
=============
(0)
NX NETWORKS, INC.
MONTHLY OPERATING REPORT - UNAUDITED
INCOME STATEMENT
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH APRIL 1 TO APRIL 30, 2002
APRIL MARCH FEBRUARY JANUARY
2002 2002 2002 2002 YEAR TO DATE
---- ---- ---- ---- ------------
SALES:
Product Sales -- 15,455 667,347 271,214 954,016
Service Sales -- 27,372 189,849 335,546 552,766
-----------------------------------------------------------------------
-- 42,827 857,196 606,760 1,506,783
-----------------------------------------------------------------------
COST OF SALES:
Product Cost of Sales - materials -- 10,652 282,705 127,713 421,069
Product Cost of Sales - manufacturing overhead -- 5,364 31,046 69,947 106,357
Service Costs -- 46,987 92,630 95,581 235,197
-----------------------------------------------------------------------
-- 63,002 406,381 293,241 762,624
-----------------------------------------------------------------------
GROSS MARGIN -- (20,175) 450,815 313,519 744,159
-----------------------------------------------------------------------
0.49
OPERATING EXPENSES:
- -------------------
OFFICER SALARIES (GROSS) -- 74,707 33,892 33,892 142,492
OTHER EMPLOYEES SALARIES (GROSS) 28,338 30,122 74,655 123,589 256,704
TAXES (PAYROLL: EMPLOYER'S SHARE) 2,516 9,959 8,749 16,403 37,627
EMPLOYEE BENEFITS (insurance,pension etc) 7,500 7,500 15,000
TRAVEL & ENTERTAINMENT (73) 558 11,754 3,895 16,134
TELEPHONE (6,462) 136 3,861 6,330 3,865
UTILITIES (2,500) 5,884 3,200 6,584
OFFICE SUPPLIES 2,146 5,380 3,335 2,066 12,927
POSTAGE & DUPLICATION 32 1,354 3,087 169 4,641
OFFICE RENT 6,204 13,531 13,460 33,195
REPAIRS & MAINTENANCE 317 3,831 4,149
LEGAL 20,093 82,930 10,000 10,250 123,272
ACCOUNTING 1,322 -- 141 1,463
MARKETING EXPENSE 354 325 325 1,004
TRANSFER AGENT FEE 1,275 -- 1,272 1,283 3,830
INSURANCE 18,506 33,155 33,460 33,480 118,600
BAD DEBT EXPENSE -- -- (400,000) (400,000)
SALES CONTRACTORS 1,387 4,913 4,913 11,213
CONSULTING 2,000 116,999 49,453 60,335 228,787
OTHER TAX 5,390 12 7,171 12,572
OTHER EXPENSES 1,816 737 4,667 1,059 8,279
-----------------------------------------------------------------------
Total operating expense $ 70,187 $ 368,191 $ 270,667 $ (66,706) $ 642,339
=======================================================================
OPERATING INCOME/(LOSS)/EBITDA (70,187) (388,367) 180,148 380,225 101,820
DEPRECIATION -- 1,629 51,526 54,725 107,881
GOODWILL AMORTIZATION -- -- 16,125 16,125 32,250
ESTIMATED LOSS ON FOREIGN SUBS LIQUIDATION -- -- (37,443) (37,443)
-----------------------------------------------------------------------
-- 1,629 30,208 70,850 102,688
Other Income (Expenses)
Interest Expense -- -- -- -- --
Interest Income -- 15 3 3 20
Other Income -- 44,388 11,838 3,562 59,789
-----------------------------------------------------------------------
Total income and other expense -- 44,403 11,841 3,565 59,809
-----------------------------------------------------------------------
NET INCOME/(LOSS) FROM OPERATIONS $ (70,187) $ (345,593) $ 161,780 $ 312,940 $ 58,941
=======================================================================
Loss on sale of assets -- (3,299,302) -- (3,299,302)
-----------------------------------------------------------------------
NET INCOME/(LOSS) $ (70,187) $(3,644,894) $ 161,780 $ 312,940 $(3,240,361)
=======================================================================
NX NETWORKS, INC.
MONTHLY OPERATING REPORT - UNAUDITED
INCOME STATEMENT
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH MAY 1 TO MAY 31, 2002
MAY APRIL MARCH FEBRUARY JANUARY
2002 2002 2002 2002 2002 YEAR TO DATE
---- ---- ---- ---- ---- ------------
SALES:
Product Sales -- -- 15,455 667,347 271,214 954,016
Service Sales -- -- 27,372 189,849 335,546 552,766
=========== =========== =========== =========== =========== ===========
-- -- 42,827 857,196 606,760 1,506,783
=========== =========== =========== =========== =========== ===========
COST OF SALES:
Product Cost of Sales -
materials -- -- 10,652 282,705 127,713 421,069
Product Cost of Sales -
manufacturing overhead -- -- 5,364 31,046 69,947 106,357
Service Costs -- -- 46,987 92,630 95,581 235,197
=========== =========== =========== =========== =========== ===========
-- -- 63,002 406,381 293,241 762,624
=========== =========== =========== =========== =========== ===========
GROSS MARGIN -- -- (20,175) 450,815 313,519 744,159
=========== =========== =========== =========== =========== ===========
0.49
OPERATING EXPENSES:
OFFICER SALARIES (GROSS) 74,707 33,892 33,892 142,492
OTHER EMPLOYEES SALARIES (GROSS) 26,388 28,338 30,122 74,655 123,589 283,092
TAXES (PAYROLL: EMPLOYER'S SHARE) 2,982 2,516 9,959 8,749 16,403 40,609
EMPLOYEE BENEFITS (insurance,
pension etc) 7,500 7,500 15,000
TRAVEL & ENTERTAINMENT -- (73) 558 11,754 3,895 16,134
TELEPHONE -- (6,462) 136 3,861 6,330 3,865
UTILITIES (2,500) 5,884 3,200 6,584
OFFICE SUPPLIES 1,181 2,146 5,380 3,335 2,066 14,108
POSTAGE & DUPLICATION 31 32 1,354 3,087 169 4,672
OFFICE RENT 6,204 13,531 13,460 33,195
REPAIRS & MAINTENANCE 317 3,831 4,149
LEGAL 21,546 20,093 82,930 10,000 10,250 144,818
ACCOUNTING 1,322 -- 141 1,463
MARKETING EXPENSE 354 325 325 1,004
TRANSFER AGENT FEE 2,667 1,275 -- 1,272 1,283 6,497
INSURANCE 19,888 18,506 33,155 33,460 33,480 138,489
BAD DEBT EXPENSE -- -- (400,000) (400,000)
SALES CONTRACTORS 1,387 4,913 4,913 11,213
CONSULTING 2,000 2,000 116,999 49,453 60,335 230,787
OTHER TAX 1,684 5,390 12 7,171 14,256
OTHER EXPENSES 2,184 1,816 737 4,667 1,059 10,463
----------- ----------- ----------- ----------- ----------- -----------
Total operating expense $ 80,550 $ 70,187 $ 368,191 $ 270,667 $ (66,706) $ 722,889
=========== =========== =========== =========== =========== ===========
OPERATING INCOME/(LOSS)/EBITDA (80,550) (70,187) (388,367 180,148 380,225 21,270
DEPRECIATION -- -- 1,629 51,526 54,725 107,881
GOODWILL AMORTIZATION -- -- -- 16,125 16,125 32,250
ESTIMATED LOSS ON FOREIGN SUBS
LIQUIDATION -- -- -- (37,443) (37,443)
=========== =========== =========== =========== =========== ===========
-- -- 1,629 30,208 70,850 102,688
Other Income (Expenses)
Interest Expense -- -- -- -- --
Interest Income -- -- 15 3 3 20
Other Income -- -- 44,388 11,838 3,562 59,789
=========== =========== =========== =========== =========== ===========
Total income and other
expense -- -- 44,403 11,841 3,565 59,809
=========== =========== =========== =========== =========== ===========
NET INCOME/(LOSS) FROM OPERATIONS $ (80,550) $ (70,187) $ (345,593) $ 161,780 $ 312,940 $ (21,609)
=========== =========== =========== =========== =========== ===========
Loss on sale of assets -- -- (3,299,302) (3,299,302)
----------- ----------- ----------- ----------- ----------- -----------
NET INCOME/(LOSS) $ (80,550) $ (70,187) $(3,644,894) $ 161,780 $ 312,940 $(3,320,911)
=========== =========== =========== =========== =========== ===========
NX NETWORKS, INC.
CASH FLOW STATEMENT (SOURCES (USES) OF CASH) - UNAUDITED
PAYROLL AND TAX ACCOUNTS
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH ENDING MAY 31, 2002
All Figures Refer to Post-petition Transactions
Net Income/(loss)
(80,550)
Add expenses not requiring Cash:
Loss on sale of assets --
Depreciation --
Goodwill amortization --
--------------
Other Sources (Uses) Cash:
Accounts receivable
Inventories
Other current assets
10,102
Deposits --
Note Receivable 150,000
Other Receivable 254,855
Goodwill
accounts payable 191,795
Deferred revenue
Accrued liabilities (164,242)
--------------
total other souces (uses) of cash 442,510
Net decrease in cash and cash equivalents 361,960
Cash beginning 1,130,829
--------------
Cash ending 1,492,789
-
NX NETWORKS, INC.
AGED POST PETITION ACCOUNTS RECEIVABLE
CALENDAR MONTH MAY 1 TO MAY 31, 2002
CUSTOMER NAME 0-30 31-60 60-90 90+ TOTAL
0 0 0 0 0
===================================================
NX NETWORKS, INC.
AGED POST PETITION ACCOUNTS RECEIVABLE
CALENDAR MONTH MAY 1 TO MAY 31, 2002
VENDORNAME LESSTHAN30 OVER30 OVER60 OVER90 TOTAL
Allen & Gledhill 1,796.00 - - - 1,796.00
COUNTY OF FAIRFAX - - 1,997.75 - 1,997.75
EAGLE LEASING COMPANY - 157.50 - - 157.50
EAGLE LEASING COMPANY - 78.75 - - 78.75
EAGLE LEASING COMPANY 78.75 - - - 78.75
EAGLE LEASING COMPANY 78.75 - - - 78.75
EWA TRAVEL, INC - - 1,519.50 - 1,519.50
RCW MIRUS - - 200,294.89 - 200,294.89
TRIGON - - 12,176.74 - 12,176.74
RICHARD YALEN 2,000.00 - - - 2,000.00
3,953.50 236.25 215,988.88 - 220,178.63