UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re: TAL Wireless Networks, Inc. Case No: 97-58435 MM
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CHAPTER 11
MONTHLY OPERATING REPORT
(General Business Case)
SUMMARY OF FINANCIAL STATUS
MONTH ENDED July, 1998
1. Debtor in possession hereby submits this Monthly Operating Report on the
Accrual Basis of accounting (or if checked here ___ the Office of the U.S.
Trustee or the Court has approved the Cash Basis of Accounting for the
Debtor). Dollars reported in ($ _____).
End of End of As of
Current Prior Petition
2. Asset/Liability Summary Month Month Filing
---------- ---------- ----------
Current Assets (Market Value) $89,464 $89,956 $245,867
---------- ---------- ----------
Total Assets (Market Value) $5,502,082 $5,502,574 $5,665,985
---------- ---------- ----------
Current Liabilities $121,646 $106,971 $0
---------- ---------- ----------
Total Liabilities $5,588,681 $5,574,006 $5,467,035
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Petition
Current Prior Date to
3. Statement of Cash Receipts & Disbursements for Month Month Month Month End
---------- ---------- ----------
a. Total Receipts $8 $14 $26,217
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b. Total Disbursements $500 $10,657 $28,390
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c. Excess (Deficiency) of Receipts Over Disbursements (a - b) ($492) ($10,643) ($2,173)
---------- ---------- ----------
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d. Cash Balance Beginning of Month $14,800 $25,443
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e. Cash Balance End of Month (c + d) $14,308 $14,800
---------- ----------
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4. Post-petition Liabilities & Receivables Receivables Liabilities
----------- ----------
Balance at End of Previous Month $75,156 $99,684
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Balance at End of Current Month $75,156 $121,646
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5. Past Due Post-Petition Liabilities
Balance at End of Previous Month (over 30 days) $0
-- ------
Balance at End of Current Month (over 30 days) $1,833
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Yes No
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6. Are all federal, state, and local taxes current? (if no, attach
schedule of unpaid items) X
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7. Have any payments been made to pre-petition creditors, other than
payments in the normal course to secured creditors or lessors? (if
yes, attach listing including date of payment, amount of payment and
name of payee) X
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8. Have any payments been made to officers, insiders, shareholders,
relatives? (if yes, attach listing including date of payment, amount
and reason for payment, and name of payee) X
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9. Have any payments been made to professionals? (if yes, attach listing
including date of payment, amount of payment and name of payee) X
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10. If you answered yes to line 7,8, or 9, were all such payments approved
by the court?
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11. Is the estate insured for replacement cost of assets and for general
liability? X
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12. Are U.S. Trustee quarterly fees current? X
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I declare under penalty of perjury that I have reviewed the above
summary and attached financial statements, and after making reasonable
inquiry believe that these documents are correct.
Date: August 14, 1998 Richard J Redett
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Responsible Individual
BALANCE SHEET
(General Business Case)
For the Month Ended July, 1998
----------
($ _____)
Assets
From Schedules Market Value
Current Assets
1 Cash and cash equivalents - unrestricted $14,308
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2 Cash and cash equivalents - restricted $0
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3 Accounts receivable (net) A $75,156
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4 Inventory B $0
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5 Prepaid expenses $0
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6 Other: _______________________________ --------------
7 ______________________________________ --------------
8 Total Current Assets $89,464
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Property and Equipment (Market Value)
9 Real property C $0
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10 Machinery and equipment D $0
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11 Furniture and fixtures D $0
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12 Office equipment D $0
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13 Leasehold improvements D $0
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14 Vehicles D $0
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15 Other: _______________________________ D
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16 ______________________________________ D
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17 ______________________________________ D
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18 ______________________________________ D
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19 ______________________________________ D
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20 Total Property and Equipment $0
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Other Assets
21 Notes receivable-net of allowances $5,000,000
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22 Investment-NST $300,000
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23 Investment-subs $112,618
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24 Accounts receivable-intercompany net of allowances $0
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25 Total Other Assets $5,412,618
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26 Total Assets $5,502,082
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NOTE:
Indicate the method used to estimate the market value of assets (e.g.,
appraisals; familiarity with comparable market prices, etc.) and the
date the value was determined. Estimated based on experience
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Liabilities and Equity
(General Business Case)
($______ )
Liabilities From Schedules
Post-Petition
Current Liabilities
27 Salaries and wages
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28 Payroll taxes
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29 Real and personal property taxes
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30 Income taxes
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31 Notes payable (short term)
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32 Accounts payable (trade) A $2,036
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33 Real property lease arrearage
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34 Personal property lease arrearage
------------
35 Accrued professional fees $119,610
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36 Current portion of long-term debt (due within 12 months)
------------
37 Other: ________________________________________________ ------------
38 ________________________________________________ ------------
39 ________________________________________________ ------------
40 Total Current Liabilities $121,646
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41 Long-Term Debt, Net of Current Portion
------------
42 Total Post-Petition Liabilities $121,646
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Pre-Petition Liabilities (allowed amount)
43 Secured claims E $100,000
------------
44 Priority unsecured claims E $101,776
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45 General unsecured claims E $5,265,259
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46 Total Pre-Petition Liabilities $5,467,035
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47 Total Liabilities $5,588,681
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Equity (Deficit)
48 Preferred Stock $80,000
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49 Common Stock $28,846
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50 Additional Paid-In Capital $18,461,441
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51 Accumulated Deficit ($18,622,143)
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52 Market value adjustment ($34,743)
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53 Total Equity (Deficit) ($86,599)
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54 Total Liabilities and Equity (Deficit) $5,502,082
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Schedules
(General Business Case)
($ ______)
Schedule A
Accounts Receivable(Net)/Payable
Accounts Accounts Payable Past Due
Receivables and Payables Ageings Receivable [Post Petition] Post Petition Debt
----------- ---------------- ------------------
0 -30 Days $203
----------- -------------
31-60 Days $408
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61-90 Days $767 $1,833
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91+ Days $75,156 $658
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Total accounts receivable/payable $75,156 $2,036
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----------- -------------
Allowance for doubtful accounts
-----------
Accounts receivable (net) $75,156
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Schedule B
Inventory/Cost of Goods Sold
Types and Amount of Inventory(ies) Cost of Goods Sold
---------------------------------- ------------------
Inventory(ies) Inventory Beginning of Month
Balance at ---------------
End of Month Add -
-------------
Retail/Restaurants - Net purchases
Product for resale ---------------
------------- Direct labor
---------------
Manufacturing overhead
---------------
Distribution - Freight in
Product for resale ---------------
------------- Other:
------------------------ ---------------
Manufacturer - ------------------------ ---------------
Raw materials
-------------
Work-in-progress Less -
-------------
Finished goods Inventory End of Month
------------- ---------------
Shrinkage
---------------
Other - Personal Use
---------------
Explain ______________ Cost of Goods Sold $0
______________________ ---------------
---------------
TOTAL $0
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Method of Inventory Control Inventory Valuation Methods
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Do you have a functioning perpetual Indicate by a checkmark method
inventory system? of inventory valuation used.
Yes ___ No ___
How often do you take a complete physical Valuation methods
inventory?
FIFO cost ________________
Weekly ___ LIFO cost ________________
Monthly ___ Lower of cost or
Quarterly ___ market _______________
Semi-annually ___ Retail method ____________
Annually ___
Other - ________________
Date of last physical was Unknown Explain
------------- __________________________
Date of next physical inventory N/A __________________________
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Schedule C
Real Property
Description Cost Market Value
----------- ---- ------------
None
------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
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Total $0 $0
------------ ---------------
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Schedule D
Other Depreciable Assets
Description Cost Market Value
----------- ---- ------------
Machinery & Equipment -
------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
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Total $0 $0
------------ ---------------
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Furniture & Fixtures -
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------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
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Total $0 $0
------------ ---------------
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Office Equipment -
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------------------------------------------------------- ------------ ---------------
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Total $0 $0
------------ ---------------
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Leasehold Improvements -
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------------------------------------------------------- ------------ ---------------
------------------------------------------------------- ------------ ---------------
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Total $0 $0
------------ ---------------
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Vehicles -
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Total $0 $0
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Schedule E
Pre-Petition Liabilities
Claimed Allowed
List Total Claims For Each Classification - Amount Amount (b)
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Secured claims (a) $100,000
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Priority claims other than taxes
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Priority tax claims $101,776
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General unsecured claims $5,265,259
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(a) List total amount of claims even if under secured.
(b) Estimated amount of claim to be allowed after compromise or
litigation. As an example, you are a defendant in a lawsuit alleging
damage of $10,000,000 and a proof of claim is filed in that amount.
You believe that you can settle the case for a claim of $3,000,000.
For Schedule E reporting purposes you should list $10,000,000 as the
Claimed Amount and $3,000,000 as the Allowed Amount.
Schedule F
Rental Income Information
Not Applicable to General Business Cases.
STATEMENT OF OPERATIONS
(General Business Case)
For the Month Ended July, 1998
----------
$_______
Current Month Cumulative Next Month
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Actual Forecast Variance (Case to Date) Forecast
------ -------- -------- -------------- --------
Revenues
$0 1 Gross Sales $7,000
-------- ----- --------- -------------- --------
$0 2 less: Sales Returns & Allowances
-------- ----- --------- -------------- --------
$0 3 Net Sales $7,000 $0
-------- ----- --------- -------------- --------
$0 4 less: Cost of Goods Sold (Schedule 'B') $68,271
-------- ----- --------- -------------- --------
$0 5 Gross Profit ($61,271) $0
-------- ----- --------- -------------- --------
$8 $8 6 Interest $92
-------- ----- --------- -------------- --------
7 Other Income:
$0 8
-------- ----- --------- --------------------------------------------------- -------------- --------
$0 9
-------- ----- --------- --------------------------------------------------- -------------- --------
$8 $0 $8 10 Total Revenues ($61,179) $0
-------- ----- --------- -------------- --------
Expenses
$0 11 Compensation to Owner(s)/Officer(s)
-------- ----- --------- -------------- --------
$0 12 Salaries/Commissions
-------- ----- --------- -------------- --------
$0 13 Management Fees
-------- ----- --------- -------------- --------
$0 14 Depreciation
-------- ----- --------- -------------- --------
$0 15 Taxes:
-------- ----- --------- -------------- --------
$0 16 Employer Payroll Taxes
-------- ----- --------- -------------- --------
$0 17 Real Property Taxes
-------- ----- --------- -------------- --------
$0 18 Other Taxes
-------- ----- --------- -------------- --------
$0 19 Other Selling
-------- ----- --------- -------------- --------
$0 20 Other Administrative $1,498
-------- ----- --------- -------------- --------
$0 21 Interest
-------- ----- --------- -------------- --------
22 Other Expenses:
$0 23 Storage Rental $1,601
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 24 Accounting $1,510
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 25 Press Release $625
-------- ----- --------- ------------------------------------------------- -------------- --------
$203 ($203) 26 Telecommunications $4,819
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 27 SEC Reporting $2,999
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 28 Litigation Costs $1,193
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 29
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 30
-------- ----- --------- ------------------------------------------------- -------------- --------
$203 $0 ($203) 31 Total Expenses $14,245 $0
-------- ----- --------- -------------- --------
($195) $0 ($195) 32 Subtotal ($75,424) $0
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Reorganization Items
$14,472 ($14,472) 33 Professional Fees $211,878
-------- ----- --------- -------------- --------
$0 34 Provisions for Rejected Executory Contracts
-------- ----- --------- Interest Earned on Accumulated Cash -------------- --------
$0 35 Resulting from Chp 11 Case
-------- ----- --------- -------------- --------
$0 36 Gain or (Loss) from Sale of Equipment $4,592
-------- ----- --------- -------------- --------
$500 ($500) 37 US Trustee Fees $1,000
-------- ----- --------- ------------------------------------------------- -------------- --------
$0 38 ------------------------------------------------- -------------- --------
$14,972 $0 ($14,972) 39 Total Reorganization Items $208,286 $0
-------- ----- --------- -------------- --------
($15,167) $0 ($15,167) 40 Net Profit (Loss) Before Federal & State Taxes ($283,710) $0
-------- ----- --------- -------------- --------
$0 41 Federal & State Income Taxes
-------- ----- --------- -------------- --------
($15,167) $0 ($15,167) 42 Net Profit (Loss) ($283,710) $0
-------- ----- --------- -------------- --------
-------- ----- --------- -------------- --------
Explanation of Variance to Statement of Operations
(For variances greater than +/- 10% only)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
SUMMARY OF CASH RECEIPTS AND DISBURSEMENTS
(General Business Case)
For the Month Ended July, 1998
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Cash Balance Beginning of Month $14,800
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Cash Receipts (1) $8
-------
Cash Disbursements (1) $500
-------
Excess (Deficiency) of Receipts Over Disbursements ($492)
-------
Cash Balance End of Month $14,308
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Recapitulation of Funds Held at End of Month
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Account 1 Account 2 Account 3
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Bank Wells Fargo Bank of America
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Account Type General Murray&Murray Trust
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Account No. 0114-458243 00357-63272
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Account Purpose Operations None
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Balance, End of Month $14,308 $0
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Total Funds on Hand for all Accounts $14,308
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(1) Excluding bank transfers between your accounts.