EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
MONTHLY OPERATING REPORT
File with Court and submit copy to United States Trustee within
20 days after end of month
Submit copy of report to any official committee appointed in this case
Document Explanation
REQUIRED DOCUMENTS Form No. Attached Attached
- -------------------------------------------------------------------------------------------------------------------------------
Schedule of Cash Receipts and Disbursements MOR-1 X
Bank Reconciliation (or copies of debtor's bank reconciliations) MOR-1 (CONT) X
Copies of bank statements X
Cash disbursement journals X X
Statement of Operations MOR-2 X
Balance Sheet MOR-3 X
Status of Postpetition Taxes MOR-4 X
Copies of IRS Form 6123 or payment receipt X
Copies of tax returns filed during reporting period X
Summary of Unpaid Postpetition Debts MOR-4 X
Listing of aged accounts payable X
Accounts Receivable Reconciliation and Aging MOR-5 X
Debtor Questionnaire MOR-5 X
I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and
the documents attached are true and correct to the best of my knowledge and
belief.
- ------------------------------------- -------------------------------
Signature of Debtor Date
- ------------------------------------- -------------------------------
Signature of Joint Debtor Date
/s/ Theodore J. Shoneck July 18, 2001
- ------------------------------------- -------------------------------
Signature of Authorized Individual* Date
Theodore J. Shoneck President
- ------------------------------------- -------------------------------
Printed Name of Authorized Individual Title of Authorized Individual
*Authorized individual must be an officer, director or shareholder if debtor is
a corporation; a partner if debtor is a partnership; a manager or member if
debtor is a limited liability company.
FORM MOR
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
Amounts reported should be per the debtor's books, not the bank statement.
The beginning cash should be the ending cash from the prior month or, if this is
the first report, the amount should be the balance on the date the petition was
filed. The amounts reported in the "CURRENT MONTH - ACTUAL" column must equal
the sum of the four bank account columns. The amounts reportedin the "PROJECTED"
columns should be taken from the SMALL BUSINESS INITIAL REPORT (FORM IR-1).
Attach copies of the bank statements and the cash disbursement journal. The
total disbursements listed in the disbursement journal must equal the total
disbursements reported on this page. A bank reconciliation must be attached for
each account. [See MOR-1 (CON'T)]
CUMULATIVE FILING
BANK ACCOUNTS CURRENT MONTH TO DATE
OPER PAYROLL Canada P/R Lockbox ACTUAL PROJECTED ACTUAL PROJECTED
- -----------------------------------------------------------------------------------------------------------------------------------
Cash Beginning of Month 324,208 70,226 3,874 5,216 403,524 277,400 977,761 977,761
RECEIPTS
Cash Sales
Accounts Receivable - 1,974,000 1,974,000 786,000 16,699,089 11,043,000
Loans and Advances 1,260,000 1,260,000 1,390,000 11,395,000 12,872,000
Sale of Assets - 6,800 -
Other (Attach List) 7,678 13,417 21,095 - 188,784 -
Transfers (From DIP Accts) 500,000 6,145 506,145 - 2,920,467 -
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RECEIPTS 1,267,678 500,000 6,145 1,987,417 3,761,240 2,176,000 31,210,140 23,915,000
- -----------------------------------------------------------------------------------------------------------------------------------
DISBURSEMENTS
Net Payroll 54,206 465,960 3,834 524,000 536,000 4,020,942 4,036,000
Payroll Taxes 65,535 38,302 163 104,000 99,000 897,142 903,000
Sales, Use & Other Taxes 16,000 16,000 20,000 122,000 154,000
Inventory Purchases 177,000 177,000 200,000 3,380,000 4,435,000
Secured Rental/Leases 77,000 77,000 80,000 468,000 491,000
Insurance 123,000 123,000 123,000 342,000 667,000
Administrative 56,810 1,317 209 58,336 162,000 391,221 1,024,000
Selling 54,000 54,000 81,000 566,000 687,000
Other (Attach List) 230,000 1,925,000 2,155,000 875,000 18,645,846 14,184,000
Owner Draw*
Transfers (To DIP Accts) 506,145 506,145 - 2,920,467 -
Professional Fees - - 50,000 50,000
U.S. Trustee Quarterly Fees - - 14,000 14,000
Court Costs
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS 1,359,696 505,579 4,206 1,925,000 3,794,481 2,176,000 31,817,618 26,645,000
- -----------------------------------------------------------------------------------------------------------------------------------
NET CASH FLOW (92,018) (5,579) 1,939 62,417 (33,241) - (607,478) (2,730,000)
- -----------------------------------------------------------------------------------------------------------------------------------
CASH - END OF MONTH 232,190 64,647 5,813 67,633 370,283 277,400 370,283 (1,752,239)
- -----------------------------------------------------------------------------------------------------------------------------------
*Compensation to sole proprietors for services rendered to bankruptcy estate
Note: In order to be consistent with our Budgets the line above labeled "Net
Payroll" includes the gross salaries. In addition the line above
labeled "Payroll Taxes" also includes all fringe benefit disbursements.
THE FOLLOWING SECTION MUST BE COMPLETED
Disbursements for calculating U.S. Trustee Quarterly Fees (From Current Month Actual Column)
Total Disbursements 3,794,481
Less: Transfers to Debtor in Possession Accounts (506,145)
Plus: Estate Disbursements made by outside sources (I.e. from escrow account) -
----------
Total Disbursements for Calculating U.S. Trustee Quarterly Fees 3,288,336
==========
FORM MOR-1
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
Quad Systems Corporation Case No. 00-35667
Schedule MOR 1 Reporting Period: 6/01/01 to 6/30/01
Continuation Sheet
Current Month Cummulative
Actual Projected Actual Projected
Explanation of Other Income
- ---------------------------
Pre Pet. Voids 7,678 45,178 0
Rental of Parking Lot 4,000 0
Misc COBRA pmts/refunds 5,688 39,877 0
Insurance Claim/Refund 7,729 99,729 0
--------- ------- ---------- ----------
Total 21,095 0 188,784 0
========= ======= ========== ==========
Explanation of Other Disbursements
- ----------------------------------
Congress Repayments 1,925,000 786,000 17,165,846 11,861,000
First Union Loan Repayments 155,000 0 465,000 465,000
Interest Expense 3,000 0 21,000 21,000
Commissions 72,000 85,000 539,000 1,142,000
Engineering 0 4,000 5,000 95,000
QEL Requirements 0 0 450,000 600,000
--------- ------- ---------- ----------
Total 2,155,000 875,000 18,645,846 14,184,000
========= ======= ========== ==========
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
STATEMENT OF OPERATIONS
(Income Statement)
The Statement of Operations is to be prepared on an accrual basis. The accrual
basis of accounting recognizes revenue when it is realized and expenses when
they are incurred, regardless of when cash is actually received or paid.
REVENUES Month Cumulative Filing to Date
- -------- ----- -------------------------
Gross Revenues $ 2,543,018 $ 16,817,196
Less: Returns and Allowances -- --
--------- ---------
Net Revenue 2,543,018 16,817,196
COST OF GOODS SOLD
Beginning Inventory 9,912,846 15,046,970
Add: Purchases 323,678 3,829,971
Add: Cost of Labor 42,273 390,687
Add: Other Costs (attach schedule) 236,497 1,597,444
Less: Ending Inventory 8,721,326 8,721,326
Cost of Goods Sold 1,793,968 12,143,746
Gross Profit 749,050 4,673,450
--------- ---------
Advertising 396 50,467
Auto and Truck Expense -- --
Bad Debts -- 52,000
Contributions -- --
Employee Benefit Programs 30,758 161,360
Insider Compensation* -- --
Insurance 124,560 317,636
Management Fees/Bonuses -- --
Office Expense 4,644 91,337
Pension & Profit-Sharing Plans -- --
Repairs and Maintenance 2,562 54,485
Rent and Lease Expense 55,585 388,216
Salaries/Commissions/Fees 370,774 3,184,004
Supplies 3,733 (1,862)
Taxes - Payroll 32,061 336,472
Taxes - Real Estate 1,330 12,401
Taxes - Other 5,029 (5,671)
Travel and Entertainment 53,960 383,543
Utilities 12,819 147,272
Other (attach schedule) 26,560 600,938
Total Operating Expenses Before Depreciation 724,771 5,772,598
Depreciation/Depletion/Amortization 89,535 269,423
Net Profit (Loss) Before Other Income & Expenses (65,256) (1,368,571)
--------- ---------
OTHER INCOME AND EXPENSES
Other Income (attach schedule) 9,500,310 9,500,310
Interest Expense 79,944 530,758
Other Expense (attach schedule) -- --
Net Profit (Loss) Before Reorganization Items 9,355,110 7,600,981
--------- ---------
REORGANIZATION ITEMS --
Professional Fees -- 50,000
U.S. Trustee Quarterly Fees -- 14,000
Interest Earned on Accumulated Cash from
Chapter 11 (see continuation sheet) -- --
(Gain)/Loss from Sale of Equipment -- 836
Other Reorganization Expenses (attach schedule) -- --
Total Reorganization Expenses -- 64,836
Income Taxes (175,754)
--------- ---------
Net Profit (Loss) 9,355,110 7,711,899
========= =========
*"Insider" is defined in 11 U.S.C. Section 101(31).
FORM MOR-2
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
STATEMENT OF OPERATIONS - continuation sheet
Cumulative
BREAKDOWN OF OTHER CATEGORY Month Filing to Date
- --------------------------------------------------------------------------------
Other Costs
Overhead Absorption 153,028 1,408,106
Service Labor Costs 29,080 395,833
Warranty Costs 25,183 497,597
Non-Inventory Reserve Expenses 29,206 (704,092)
--------- ---------
Total 236,497 1,597,444
========= =========
Other Operational Expenses
Freight 4,041 70,900
Bank Charges & LOC Fees 15,548 142,144
Professional Fees 6,971 132,055
Patent Royalties -- 255,839
--------- ---------
Total 26,560 600,938
========= =========
Other Income
Dividend (Forgiveness of Intercompany Debt)
from Hitech (Subsidiary) 9,481,086 9,481,086
Gain Realized by liquidation of
Quad Foreign Sales (Subsidiary) 19,224 19,224
--------- ---------
Total 9,500,310 9,500,310
========= =========
Other Expenses
Other Reorganization Expenses
Reorganization Items - Interest Earned on Accumulated Cash from Chapter 11:
Interest earned on cash accumulated during the chapter 11 case, which would not
have been earned but for the bankruptcy proceeding, should be reported as a
reorganization item.
FORM MOR-2 (CONT)
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
BALANCE SHEET
The Balance Sheet is to be completed on an accrual basis only. Pre-petition
liabilities must be classified separately from postpetition obligations.
BOOK VALUE
AT END OF BOOK VALUE
CURRENT ON
REPORTING PETITION
ASSETS MONTH DATE
- ------------------------------------------------------------------------------------------
CURRENT ASSETS
Unrestricted Cash and Equivalents 233,190 161,799
Restricted Cash and Cash Equivalents
(see continuation sheet) 138,093 815,962
Accounts Receivable (Net) 1,796,143 3,130,385
Notes Receivable -- --
Inventories 8,721,326 15,046,970
Prepaid Expenses 207,710 433,952
Professional Retainers -- --
Other Current Assets (attach schedule) 334,983 (325,421)
---------- ----------
TOTAL CURRENT ASSETS 11,431,445 19,263,647
========== ==========
PROPERTY AND EQUIPMENT
Real Property and Improvements 177,958 276,575
Machinery and Equipment 1,716,773 2,124,028
Furniture, Fixtures and Office Equipment 2,154,232 3,210,503
Leasehold Improvements 330,078 330,078
Vehicles 19,142 30,594
Less Accumulated Depreciation 3,243,234 4,324,223
---------- ----------
TOTAL PROPERTY & EQUIPMENT 1,154,949 1,647,555
========== ==========
OTHER ASSETS
Loans to Insiders*
Other Assets (attach schedule) 10,096,807 1,054,423
---------- ----------
TOTAL OTHER ASSETS 10,096,807 1,054,423
---------- ----------
TOTAL ASSETS 22,683,201 21,965,625
========== ==========
BOOK VALUE
AT END OF BOOK VALUE
CURRENT ON
REPORTING PETITION
LIABILITIES AND OWNER EQUITY MONTH DATE
- ------------------------------------------------------------------------------------------
LIABILITIES NOT SUBJECT TO COMPROMISE (Postpetition)
Accounts Payable 80,861 8,246,757
Taxes Payable (refer to FORM MOR-4) 368,626 370,167
Wages Payable 274,164 671,333
Notes Payable -- --
Rent/Leases - Building/Equipment 105,280 220,133
Secured Debt / Adequate Protection Payments 507,765 6,317,257
Professional Fees -- --
Amounts Due to Insiders* -- --
Other Postpetition Liabilities (attach schedule) 2,030,866 3,861,109
---------- ----------
TOTAL POSTPETITION LIABILITIES 3,367,562 19,686,756
========== ==========
LIABILITIES SUBJECT TO COMPROMISE (Pre-Petition)
Secured Debt
Priority Debt 182,489 --
Unsecured Debt 9,142,382 --
---------- ----------
TOTAL PRE-PETITION LIABILITIES 9,324,871 --
---------- ----------
TOTAL LIABILITIES 12,692,433 19,686,756
========== ==========
OWNER EQUITY
Capital Stock 135,531 135,531
Additional Paid-In Capital 24,733,708 24,733,708
Partners' Capital Account -- --
Owner's Equity Account --
Retained Earnings - Pre-Petition (22,590,370) (22,590,370)
Retained Earnings - Postpetition 7,711,899 --
Adjustments to Owner Equity (attach schedule) -- --
Postpetition Contributions (Distributions)
(Draws) (attach schedule) -- --
---------- ----------
NET OWNER EQUITY 9,990,768 2,278,869
---------- ----------
TOTAL LIABILITIES AND OWNERS EQUITY 22,683,201 21,965,625
========== ==========
*"Insider" is defined in 11 U.S.C. Section 101(31).
FORM MOR-3
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Case No. 00-35667
------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
BALANCE SHEET - continuation sheet
BOOK VALUE
AT END OF BOOK VALUE
CURRENT ON
REPORTING PETITION
ASSETS MONTH DATE
- --------------------------------------------------------------------------
Other Current Assets
Accts Rec - Misc 198,478 537
Temp. Empl Advances -- 43,891
Permanent Advances 1,100 921
Deposits 98,722 40,437
Interco - Current 36,683 (411,207)
Other Assets
Acquisition Costs - QEL 6,448 8,598
Patent Costs 1,527 1,977
Invest - Hitech/QSM 4,025,831 4,026,831
Invest - QEL 2,500,000 2,500,000
Interco - Long Term (1,099,278) (10,145,262)
Invest - QSL 4,662,279 4,662,279
BOOK VALUE
AT END OF BOOK VALUE
CURRENT ON
REPORTING PETITION
LIABILITIES AND OWNER EQUITY MONTH DATE
- ------------------------------------------------------------------------
Other Postpetition Liabilities
Deferred Revenue 933,136 1,151,531
Customer Deposits 34,824 416,644
Accrued Expenses 719,457 1,872,647
Commission Payable 343,449 420,287
Postpetition Contributions (Distributions) (Draws)
Restricted Cash: cash that is restricted for a specific use and not available to
fund operations. Typically, restricted cash is segregated into a separate
account, such as an escrow account.
FORM MOR-3 (CONT)
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
STATUS OF POSTPETITION TAXES
The beginning tax liability should be the ending liability from the prior month
or, if this is the first report, the amount should be zero. Attach photocopies
of IRS Form 6123 or payment receipt to verify payment or deposit of federal
payroll taxes Attach photocopies of any tax returns filed during the reporting
period
Amount
Beginning Withheld or Amount Check No. Ending Tax
Tax Liability Accrued Paid Date Paid or EFT Liability
- -----------------------------------------------------------------------------------------------------------------------------------
Federal
Withholding - 75,924 75,924 6/8, 6/22 ADP EFT -
FICA-Employee - 37,837 37,837 6/8, 6/22 ADP EFT -
FICA-Employer - 37,837 37,837 6/8, 6/22 ADP EFT -
Unemployment - 38 38 6/8, 6/22 ADP EFT -
Income - - - -
Other: Tax Accounting Accrual
Only from prior years 352,702 - - 352,702
--------- ------- ------- ------ ------- ---------
Total Federal Taxes 352,702 151,636 151,636 - - 352,702
--------- ------- ------- ------ ------- ---------
State and Local
Withholding - 20,430 20,430 6/8, 6/22 ADP EFT -
Sales 8,336 17,936 10,348 CA EFT/Ck170059 15,924
Excise - -
Unemployment - 602 602 6/8, 6/22 ADP EFT -
Real Property - -
Other: Canadian P/R Taxes - 1,434 1,434 6/8, 6/22 ADP EFT -
--------- ------- ------- ------ ------- ---------
Total State and Local 8,336 40,402 32,814 15,924
--------- ------- ------- ------ ------- ---------
Total Taxes 361,038 192,038 184,450 368,626
--------- ------- ------- ------ ------- ---------
SUMMARY OF UNPAID POSTPETITION DEBTS
Attach aged listing of accounts payable.
Number of Days Past Due
-------------------------------------------------------------
Current 0-30 31-60 61-90 Over 90 Total
------- ---- ----- ----- ------- -----
Accounts Payable 43,922 458 28,606 7,875 80,861
Wages Payable 274,164 274,164
Taxes Payable 15,924 352,702 368,626
Rent/Leases-Building - -
Rent/Leases-Equipment 105,280 105,280
Secured Debt/Adequate Protection Payments 507,765 507,765
Professional Fees - -
Amounts due to Insiders* - -
Other: -
Other: -
--------- ----- ------ ------ ------- ---------
Total Postpetition Debts 947,055 458 28,606 7,875 352,702 1,336,696
========= ===== ====== ====== ======= =========
Explain how and when the Debtor intends to pay any past due postpetition debts.
Note: above Taxes Payable in Past Due Column represents an prior year accounting
accrual only. It does not represent an actual payment due.
Note: Some Sales Taxes Paid are CA monthly estimate and NJ return was filed
*"Insider" is defined in 11 U.S.C. Section 101(31).
FORM MOR-4
(9/99)
EXHIBIT 99
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF PENNSYLVANIA
In re: Quad Systems Corporation Case No. 00-35667
------------------------ Reporting Period: 6/01/01 to 6/30/01
Debtor
ACCOUNTS RECEIVABLE RECONCILIATION AND AGING
Accounts Receivable Reconciliation Amount
- ---------------------------------- ------
Total Accounts Receivable at the beginning of the reporting period 1,486,316
+ Amounts billed during the period 2,483,594
- - Amounts collected during the period 1,953,767
Total Accounts Receivable at the end of the reporting period 2,016,143
Accounts Receivable Aging
- -------------------------
0 - 30 days old 1,581,207
31 - 60 days old 213,698
61 - 90 days old 56,215
91+ days old 165,023
Total Accounts Receivable 2,016,143
Amount considered uncollectible (Bad Debt) (220,000)
Accounts Receivable (Net) 1,796,143
Note: the Accounts Receivable collections include the application of customer
deposits received in prior periods
FORM MOR-5
(9/99)