MONTHLY OPERATING REPORT
Calendar Month January 1, 2002 to January 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: 27
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 [ ] No [X] Not Applicable [ ]
6. PRE-PETITION ACCOUNTS RECEIVABLE:
Beginning Balance $ 719,713
-----------
Collected this Period $ 224,405
Write-offs against allowance $ 119
-----------
Ending Balance $ 495,189
7. POST-PETITION ACCOUNTS RECEIVABLE:
0-30 Days: $569,093 31-60 Days: $275,108 Over 61-90 Days: $341,076
Days over 90: $22,000
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: $10,269 31-60 Days: $87,035 Over 60 Days: $117,880
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 [ ] No [X] 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: Payroll taxes were deposit to the payroll account during this
period. Going forward payroll taxes will be deposited into the tax
account.
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 3/11/02 Liability 3/11/02
Fire Workers Comp. 3/11/02
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 con
trol 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 [ ] No [X] Explain:
15. PAYMENTS TO SECURED CREDITORS during reporting period:
(Attach additional sheets, if necessary.)
Creditor Freq. of Payments Amount of Next Post Petition Payments
Per Contract each Payment Not Made
(mo, qtr) Payment Due Mo. 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 $16,892.79
Brown Rudnick Freed Gemser Attorneys $50,000.00
17. QUARTERLY U.S. TRUSTEE FEES paid during reporting period: $7,500.00
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: 2/15/02 DEBTOR-IN-POSSESSION
Name/Title: Richard Yalen, CEO By: /s/ Richard Yalen
-------------------------
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
) Case Number: 01-14223
)
)
Debtor(s) )
- ------------------------
Cash Disbursements Summary Report
Calendar Month Ending January 31, 2002
Total Disbursements from Operating Account
(See Note 1) $510,605.53
------------
Total Disbursements from Payroll Account
(See Note 2) $105,692.99
------------
Total Disbursements from Tax Escrow Account
(See Note 3) $ 60,815.24
------------
Total Disbursements from any other Account
(See Note 4) 0
------------
Grand Total Disbursments from all Accounts $683,113.76
------------
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 ac-count 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.)
NXNETWORKS, INC.
CONSOLIDATED BALANCE SHEET - UNAUDITED
AS OF JANUARY 31, 2002
ASSETS
------
CURRENT ASSETS
Cash and cash equivalents 523,322
Pre-Petition Accounts Receivable 495,189
Post-Petition Accounts receivable 1,207,277
Less reserve for bad debt & returns (747,210)
Receivables from Officers, Affiliates, Employees -
Inventory 2,930,221
Other current assets
Prepaids 512,041
------------
Total Current Assets 4,920,840
FIXED ASSETS
Property and Equipment 9,999,743
Less: Accumulated Depreciation (9,395,478)
------------
Total Fixed Assets 604,265
OTHER ASSETS
Deposits 659,584
Goodwill, Net 370,876
-----------
Total Other Assets 1,030,459
-----------
TOTAL ASSETS 6,555,564
===========
LIABILITIES & STOCKHOLDER'S EQUITY
----------------------------------
POST-PETITION LIABILITIES:
Accounts Payable 215,184
Accrued Accounts Payable 145,566
Accrued liability for sub liquidation 338,031
Deferred Revenue 250,920
Taxes Payable 2,149
-----------
Total Post-Petition Liabilities 951,850
PRE-PETITION LIABILITIES:
Priority Claim 528,076
Secured Claim 558,735
Unsecured 13,088,400
General pre-pretition accruals 4,880,873
Total Pre-Petition Liabilities 19,056,085
-----------
TOTAL LIABILITIES 20,007,935
-----------
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 312,940
Warrants 6,322,333
Notes Receivable from officer (1,000,000)
Cummulative Translation Adj. (36,616)
Total Stockholders' equity (13,452,371)
------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 6,555,564
============
NXNETWORKS, INC.
CASH FLOW STATEMENT (SOURCES (USES) OF CASH) - UNAUDITED
PAYROLL AND TAX ACCOUNTS
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH ENDING JANUARY 31, 2002
All figures refer to post-petition transactions
Net Income/(loss) 312,940
add expenses not requiring Cash:
Depreciation 54,725
Goodwill Amortization 16,125
---------------
70,850
Other Sources (Uses) Cash:
Accounts receivable (510,687)
Inventories 95,338
Other current assets (16,948)
Deposits 591
accounts payable (149,433)
Accrued liabilities 75,295
total other souces (uses) of cash (88,158)
Cash beginning 611,480
Cash ending 523,322
(0)
NX NETWORKS, INC.
MONTHLY OPERATING REPORT
INCOME STATEMENT - UNAUDITED
(BUSINESS DEBTOR, ACCRUAL BASIS)
CALENDAR MONTH JANUARY 1 TO JANUARY 31, 2002
For the Month Ended
January 31, 2002
--------------------
SALES:
Product Sales 271,214
Service Sales 335,546
-----------
606,760
-----------
COST OF SALES:
Product Cost of Sales - materials 127,713
Product Cost of Sales -
manufacturing overhead 69,947
Service Costs -- includes payroll
and other costs 95,581
-----------
293,241
-----------
GROSS MARGIN 313,519
-----------
OPERATING EXPENSES:
OFFICER SALARIES (GROSS) 33,892
OTHER EMPLOYEES SALARIES (GROSS) 123,589
TAXES (PAYROLL: EMPLOYER'S SHARE) 16,403
EMPLOYEE BENEFITS (insurance, pension,
etc.) 7,500
TRAVEL & ENTERTAINMENT 3,895
TELEPHONE 6,330
UTILITIES 3,200
OFFICE SUPPLIES 2,066
POSTAGE & DUPLICATION 169
OFFICE RENT 13,460
REPAIR & MAINTENANCE 3,831
LEGAL 10,250
ACCOUNTING 141
MARKETING EXPENSE 325
TRANSFER AGENT FEE 1,283
INSURANCE 33,480
BAD DEBT EXPENSE (400,000)
SALES CONTRACTORS 4,913
CONSULTING 60,335
OTHER TAX 7,171
OTHER EXPENSES 1,059
-----------
Total operating expense $ (66,706)
-----------
OPERATING INCOME/(LOSS)/EBITDA 380,225
DEPRECIATION 54,725
GOODWILL AMORTIZATION 16,125
-----------
70,850
Other Income (Expenses)
Interest Expense -
Interest Income 3
Other Income 3,562
-----------
Total income and other expense 3,565
-----------
Net Income/(Loss) $ 312,940
===========
POST PETITION AR AGING
as of 1/31/02
Customer Name 1-30 31-60 61-90 91-120+ Total
- --------------------------------------------------------------------------------------------
ALCATEL CIT 0.00 221.14 6,891.00 0.00 7,112.14
ALCATEL e-BUSINESS 20,826.73 0.00 0.00 0.00 20,826.73
ALCATEL TELECOM LIMITED 0.00 68,776.83 0.00 22,000.00 90,776.83
ALIENWARE 0.00 80.00 0.00 0.00 80.00
ANIXTER (U.K.) LIMITED 0.00 4,744.50 0.00 0.00 4,744.50
AT&T 19,330.92 0.00 0.00 0.00 19,330.92
ATRION COMMUNICATIONS 0.00 11,022.50 0.00 0.00 11,022.50
AURORA TECHNOLOGIES LTD 0.00 0.00 1,350.90 0.00 1,350.90
BANK OF CHINA INTERNATIONAL 1,577.87 0.00 0.00 0.00 1,577.87
COHERENT LASER GROUP 2,924.82 0.00 2,924.82 0.00 5,849.64
COMPAQ COMPUTER INTERNATIONAL 2,766.18 0.00 0.00 0.00 2,766.18
COMPUTERBANK NETWORKING S.A. 0.00 6,910.80 0.00 0.00 6,910.80
CONAIR CORP 150.00 0.00 0.00 0.00 150.00
CONTECH ELECTRONICS 1,192.80 0.00 0.00 0.00 1,192.80
DATAGENICS PTY LTD 24,999.99 0.00 0.00 0.00 24,999.99
DELTAWARE INC 0.00 8,729.68 0.00 0.00 8,729.68
DXL ENTERPRISES, INC. 121,047.50 66,158.00 0.00 0.00 187,205.50
EDS HONG KONG LTD. 23,873.85 0.00 0.00 0.00 23,873.85
EUROPEAN SPACE AGENCY 0.00 0.00 890.70 0.00 890.70
FORTUNE INFORMATION TECHNOLO 0.00 2,760.00 0.00 0.00 2,760.00
FRAME SA 0.00 3,784.15 0.00 0.00 3,784.15
FRITZ COMPANIES INC 13,832.93 0.00 0.00 0.00 13,832.93
GAYLORD BROS. 876.00 0.00 0.00 0.00 876.00
GEMINI ASSOCIATES INC. 0.00 0.00 0.00 0.00 0.00
GIANT INFORMATION SYSTEMS 83.04 35.80 0.00 0.00 118.84
HITRON TECHNOLOGY INC. 5,640.00 0.00 4,199.61 0.00 9,839.61
HUNTINGTON MARKET 0.00 200.00 0.00 0.00 200.00
INFORMATION SERVICES INT'L. 0.00 2,225.00 0.00 0.00 2,225.00
INFORMSVIAZ 13.46 318.99 11,197.98 0.00 11,530.43
KODAK / IBM GLOBAL SVC 0.00 0.00 900.00 0.00 900.00
K-SOLUTIONS, INC. 880.38 0.00 6,018.00 0.00 6,898.38
LOGICAL NETWORKS (EX ANITE) 27,486.90 0.00 27,486.90 0.00 54,973.80
LUCENT TECHNOLOGIES 0.00 0.00 99,999.99 0.00 99,999.99
MACKAY COMMUNICATIONS 15,912.15 0.00 0.00 0.00 15,912.15
MBG/ELEKTRONIK AB 4,102.00 0.00 1,744.00 0.00 5,846.00
MOTION TELECOM TECHNOLOGY 8,130.00 0.00 0.00 0.00 8,130.00
MOTOROLA ING 0.00 0.00 0.00 0.00 0.00
NATIONAL WATER COMMISSION 0.00 0.00 23,607.93 0.00 23,607.93
NEC CORPORATION 7,831.18 0.00 0.00 0.00 7,831.18
NETCALL 0.00 0.00 875.00 0.00 875.00
NEWMONT INTERNATIONAL 19,999.92 0.00 0.00 0.00 19,999.92
NEWMONT MINING CORPORATION 1,225.00 0.00 0.00 0.00 1,225.00
NULINK INC 0.00 0.00 800.00 0.00 800.00
OMNES 27,485.16 0.00 27,485.16 0.00 54,970.32
OMNES LTD 9,965.81 0.00 11,007.29 0.00 20,973.10
PLAYDIUM CORPORATION 2,029.75 0.00 0.00 0.00 2,029.75
POLY LINK GATEWAY 8,456.84 0.00 0.00 0.00 8,456.84
PROBIL A.S. 10,725.00 0.00 0.00 0.00 10,725.00
PSINET CANADA INC., 0.00 5,089.00 0.00 0.00 5,089.00
QXTEL LIMITED 0.00 7,800.00 1,920.00 0.00 9,720.00
REPUBLIC TELCOM OF NE 0.00 300.00 0.00 0.00 300.00
ROCKBRIDGE GLOBAL VILLAGE 0.00 150.00 286.00 0.00 436.00
SEALED AIR CORPORATION 4,914.71 0.00 4,914.71 0.00 9,829.42
SES AMERICOM, INC. 13,554.75 0.00 0.00 0.00 13,554.75
SIEMENS AG 0.00 0.00 3,770.80 0.00 3,770.80
SKYMAX COMMUNICATIONS (850.00) 0.00 0.00 0.00 (850.00)
SOLECTEK 11,400.00 0.00 0.00 0.00 11,400.00
TAKACHIHO KOHEKI CO.,LTD. 13,845.46 65,896.90 0.00 0.00 79,742.36
TELCO SOLUTIONS INC 0.00 3,840.00 0.00 0.00 3,840.00
TELECAM S A 0.00 3,199.90 0.00 0.00 3,199.90
TELECOMMUNICATIONS CONCEPTS 36,595.20 0.00 0.00 0.00 36,595.20
TELEDINAMICA MEXICANA DE 10,516.50 0.00 0.00 0.00 10,516.50
TELINDUS NETWORKS NV 3,096.92 0.00 42,720.12 0.00 45,817.04
TELUS COMMUNICATIONS EDTN IN 0.00 0.00 57,584.88 0.00 57,584.88
TESSERACT CORPORATION 450.00 0.00 0.00 0.00 450.00
THE FALLON CLINIC 0.00 750.00 0.00 0.00 750.00
TOWN OF HUDSON NH 203.40 906.83 0.00 0.00 1,110.23
TRANSACTION NETWORK SERVICES 0.00 11,108.50 2,500.00 0.00 13,608.50
WASHINGTON DATA SYSTEMS, INC 0.00 99.25 0.00 0.00 99.25
UNBILLED CONTRACT MAINTENANCE 92,000.00 0.00 0.00 0.00 92,000.00
---------------------------------------------------------------
Grand Total 569,093.12 275,107.77 341,075.79 22,000.00 1,207,276.68
===============================================================
Accounts Payable
At January 31, 2002
Post Petition
VENDOR NAME CURRENT OVER 30 TO 60 OVER 60 TOTAL
ACCENT PLANTSCAPING, INC - 168.34 - - 168.34
ADP, INC - - - 250.56 250.56
AT&T - 054 331 3299 001 - - 25.90 - 25.90
AT&T -8001 507 0636 - - - 573.90 573.90
AT&T WIRELESS - 868-75608901 - - 15.38 6.80 22.18
BEERS & CUTLER - - - 2,323.00 2,323.00
BELLSOUTH -70439892160273191 - 76.06 - - 76.06
BENICOR ASSOCIATES, INC - 1,732.09 - - 1,732.09
CAPITOL EXHIBIT SERVICES INC - 513.73 - - 513.73
NOEL CHIAPPA - 10,016.00 - - 10,016.00
CHUBB GROUP OF INSURANCE - 9,586.39 - - 9,586.39
CINGULAR WIRELESS -919129909 - 48.73 49.10 - 97.83
DELAWARE SECRETARY OF STATE - 51.20 9,385.00 - 9,436.20
DHL - 77.87 - - 77.87
EAGLE LEASING COMPANY - - 236.25 - 236.25
EQUISERVE LP - 1,283.36 - - 1,283.36
FEDERAL EXPRESS - 104678394 16.22 9.02 297.63 - 322.87
FEDERAL EXPRESS - 238989264 - 2,840.25 - 264.67 3,104.92
FEDERAL EXPRESS - 238989469 - 73.88 113.47 - 187.35
FORTUNE INFORMATION TECHNLGY - 1,934.92 1,067.46 650.80 3,653.18
FRINGE BENEFIT ADMINISTRATOR - 5,104.00 - - 5,104.00
GE GROUP LIFE ASSURANCE CO - 982.20 - - 982.20
IRON MOUNTAIN - 276.00 - - 276.00
KASTLE SYSTEMS - 743.22 - - 743.22
LEVERAGE SYSTEM TECHNOLOGIES - 450.70 - - 450.70
MCI - 1N070476 - - - 25.88 25.88
MCI - 1N143231 - - - 12.56 12.56
MCI - 1P249500 - - - 7.57 7.57
MCI - 1P723190 - - - 9.24 9.24
MENNINGERCARE SYSTEMS, INC - - - 211.20 211.20
NET 2000 - 2001.0360.0203 - - 118.25 - 118.25
NETSTAR NETWORK INTEGRATION - - 2,709.70 - 2,709.70
NEWARK ELECTRONICS - - 411.73 - 411.73
PAXTON RECORD RETENTION INC - 629.81 - - 629.81
PROVIDENT MUTUAL LIFE INS CO - 3,481.11 - - 3,481.11
QWEST - 9528318200772 - - 1,183.77 - 1,183.77
KUROSH RAFII - 48.54 - - 48.54
REAL ESTATE INVESTMENT MGRS - - - 91,941.82 91,941.82
DIRK SNIDER 469.22 46.62 - - 515.84
TELINDUS - BELGIUM (201.67) - - - (201.67)
UNDERWRITERS LABORATORIES - - 48.25 - 48.25
UPS - 03T94T - 108.16 - - 108.16
UPS - 050488 - 1,554.22 - - 1,554.22
UPS - 231367 - 111.55 18.64 77.57 207.76
VERIZON -00073643301622Y - - 89.79 153.68 243.47
VERIZON -1372101590Y - - 408.85 - 408.85
VERIZON -14160114667Y - - 291.35 - 291.35
VERIZON -50836691059280095 - 305.24 127.34 - 432.58
VERIZON -50836697020460098 - - 44.43 - 44.43
VERIZON -50861644330650094 - - (2.98) 91.00 88.02
VERIZON -50870389998160074 - - 24.08 246.91 270.99
VERIZON -50883105998490096 - 190.87 335.88 - 526.75
VERIZON -50889828001230090 - 775.81 995.46 - 1,771.27
VERIZON -50889890829210091 - 72.49 166.48 - 238.97
VERIZON -50889895134730091 - 226.08 348.05 - 574.13
VERIZON -50891292845920090 - 213.25 413.64 - 626.89
VERIZON -61781536401630085 - - (614.17) 2,056.51 1,442.34
WOODY BODE, LLC - 10,000.00 - - 10,000.00
WORLDCOM - 01703161 - 1,144.76 1,137.06 - 2,281.82
WORLDCOM - 04245982 - 2,476.15 829.82 - 3,305.97
WORLDCOM - 102018 316.80 328.02 326.15 34.87 1,005.84
WORLDCOM - 90067606 - (140.48) - 7,721.99 7,581.51
WORLDCOM - 99148090 - 2,099.64 2,177.41 2,170.27 6,447.32
WORLDCOM - U05207 - 3,229.50 - 6,459.00 9,688.50
WORLDCOM - XU31439 - 1,295.00 - 2,590.00 3,885.00
RICHARD YALEN 9,668.81 91.68 - 9,760.49
-------------------------------------------------------
10,269.38 64,255.98 22,779.17 117,879.80 215,184.33
=======================================================