DEBTOR: In Store Media Systems, Inc. MONTHLY FINANCIAL REPORT
CHAPTER 11
CASE NUMBER: 02-28289 MER
For Period: August 1, 2004 to August 31, 2004
COVER SHEET
Accounting Method Used: [ x ] Accrual Basis [ ] Cash Basis
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THIS REPORT IS DUE 15 DAYS AFTER THE END OF THE MONTH
Mark One Box for Each Debtor must attach each of the following
Required Document reports/documents unless the U.S. Trustee has waived
the requirement in writing. File the original with
the Clerk of Court. Submit a duplicate, with original
signature, to the U.S. Trustee.
- ------------------- -------------- ------------------------------------------------------
Report/Document Previously
Attached Waived REQUIRED REPORTS/DOCUMENTS
- ------------------- -------------- ------------------------------------------------------
[ x ] [ ] Cash Receipts and Disbursements Statement (Form 2-B)
[ x ] [ ] Supporting Schedules (Form 2-C)
[ x ] [ ] Balance Sheet (Form 2-D)
[ x ] [ ] Profit and Loss (Form 2-E)
[ x ] [ ] Quarterly Fee Summary (Form 2-F)
[ x ] [ ] Narrative (Form 2-G)
[ x ] [ ] Bank Statements for All Bank Accounts
[ x ] [ ] Bank Statement Reconciliations for All Bank Accounts
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I declare under penalty of perjury that the following Monthly Financial Report,
and any attachments thereto, are true and correct to the best of my knowledge
and belief.
Executed on: September 16, 2004 Debtor(s): In Store Media Systems, Inc.
By: /s/ William P. Stelt
Position: Chief Financial Officer (Acting)
Form 2-A
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 MER
---------------------------
CASH RECEIPTS AND DISBURSEMENTS STATEMENT
As of August 31, 2004
CASH RECONCILIATION
1. Beginning Cash Balance (Ending Cash Balance from last month's report) $ 3,231.51
2. Cash Receipts (From Cash Receipts Journal on next page) $ 10,000.00
3. Cash Disbursements (From Cash Disbursements Journal on next page) $ 1,528.09
4. Net Cash Flow (Line 2 minus Line 3) $ 8,471.91
5. Ending Cash Balance (To Form 2-D) $ 11,703.42
==============
CASH SUMMARY - ENDING BALANCE
Amount Financial Institution
Petty Cash $0.00
Regular Checking - New DIP $0.00
Regular Checking - Old DIP $0.00 Wells Fargo
New DIP Checking $11,703.42 Wells Fargo
Regular Checking - Payroll $0.00 Wells Fargo
Short-Term Investments $0.00 Wells Fargo
TOTAL (Must agree with line 5 above) $11,703.42
==============
Form 2-B
Rev 10/01/01
In Store Media Systems, Inc.
CASE NO. 02-28289 MER
CASH RECEIPTS AND DISBURSEMENTS STATEMENT
For Period August 1 to August 31, 2004
CASH RECEIPTS JOURNAL
Date Description (Source) Amount
- ---- -------------------- ------
Operating Account Activity
8/05/04 Acclaim Financial Group Funding $10,000.00
Total Operating Account Activity (Receipts) $10,000.00
Payroll Account Activity
Total Payroll Account Activity (Receipts) $0.00
Total Cash Receipts (to line 2 of Cash Reconciliation) $10,000.00
CASH DISBURSEMENTS JOURNAL
Date Ck Nos. Payee Description (Purpose) Amount
- ---- ------- ----- -------------------- ------
Operating Account Activity
8/11/04 2081 CSC Registration Fees $105.00
8/11/04 2082 Vintage Filings LLC SEC Filing 8 K $212.00
8/11/04 2083 Void $0.00
8/11/04 2084 Corporate Stock Transfer Stock Transfer Fees $75.00
8/11/04 2085 Mini U Storage Storage Fee $85.00
8/11/04 2086 William P. Stelt Service Charge $1,528.00
7/31/04 BK Debit Wells Fargo Bank $10.14
Total Opertaing Account Acivity (Disbursements) $1,528.09
Other Account Activity $0.00
Total Payroll Account Activity $0.00
Total Cash Disbursements (to
line 3 of Cash Reconciliation) $1,812.56
===========
Less: Intra Company Disbursements $0.00
Net Disbursements (to Schedule 2 F) $1,812.56
===========
Form 2-B
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 MER
SUPPORTING SCHEDULES
For Period August 1 to August 31, 2004
POST-PETITION TAXES PAYABLE SCHEDULE
The Debtor pays all taxes at the time of payroll processing to its Payroll
Service (Wells Fargo Express Pay). Payments are made by ACH transfer the day
before the payroll is due. Debtor pays payroll on the 15th and End of Month
therefore at the end of each month, the debtor has paid all payroll taxes due to
the Payroll Service.
Beg Balance* Additions Pmts/Deposits Date Paid Check No. End Balance
------------ --------- ------------- --------- --------- -----------
Income Tax Withheld
Federal $0.00 $0.00
State $0.00 $0.00
FICA Tax Withheld (SS & Medicare) $0.00 $0.00
Employer's FICA Tax (SS & Medicare) $0.00 $0.00
Unemployment Tax:
Federal $0.00 $0.00
State $0.00 $0.00
Sales,Use & Excise Taxes $0.00 $0.00
Property Taxes $0.00 $0.00
Accrued Income Tax:
Federal $0.00 $0.00
State $0.00 $0.00
Other: $0.00 $0.00
TOTALS (Post Petition End Bal to Form 2-D) $0.00 $0.00 $0.00 $0.00
* For first report, Beginning Balance will be $0; thereafter, Beginning Balance
will be Ending Balance from prior report.
INSURANCE SCHEDULE
Carrier/Agent Amt of Coverag ePolicy Exp Date Prem Paid Date
- ------------------ -------- ----------------------------------- --------------
None Required
Form 2-C
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 MER
SUPPORTING SCHEDULES
For Period August 1 to August 31, 2004
ACCOUNTS RECEIVABLE AND POST PETITION PAYABLE AGING
Due Post Petition
Accounts Rec Accounts Payable
Under 30 Days $0.00 $ 597.09
30 to 60 Days $0.00 $ (121.86)
61 to 90 Days $0.00 $ 97.00
91 to 120 Days $0.00 $41,559.80
Over 120 Days
Total Post Petition $0.00 xxxxxxxxxxxxxxxxx
Pre Petition Amts $0.00 xxxxxxxxxxxxxxxxx
Total Accounts Receivable $0.00 xxxxxxxxxxxxxxxxx
Less: Bad Debt Reserve $0.00 xxxxxxxxxxxxxxxxx
Net Accounts Receivable (To Form 2-D) $0.00 xxxxxxxxxxxxxxxxx
Total Post Petition Accounts Payable $42,132.03
(To Form 2-D)
SCHEDULE OF PAYMENTS TO ATTORNEYS AND OTHER PROFESSIONALS
Date of Estimated
Amt Paid Court Approval Balance Due*
-------- -------------- ------------
Debtor's Counsel $32,606.84 Pre-Petition Retainer $23,034.30 (Included in A/P)
Counsel for Unsecured Creditors' Com $0.00
Trustee's Counsel $0.00
Accountant $0.00
Other: Debtor's Corporate Counsel $25,000.00 Pre-Petition Retainer $19,097.73 (Included in A/P)
Brownstein, Hyatt and Farber $125,000.00 (Accrued not in A/P)
*Balance due to include fees and expenses incurred but not yet paid.
SCHEDULE OF PAYMENTS AND TRANSFERS TO PRINCIPALS/EXECUTIVES**
Payee Name Position Nature of Payment Amount
**List payments and transfers of any kind and in any form made to or for the
benefit of any proprietor, owner, partner, shareholder, officer or director.
Form 2-C
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 EEB
BALANCE SHEET - As of August 31, 2004
ASSETS
Current Assets:
Cash (From Form 2-B, line 5) $ 11,703.42
Accounts Receivable $0.00
Inventory $0.00
Other Current Assets: $ 2,931.75
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Total Current Assets $ 14,634.75
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Fixed Assests:
Land $0.00
Leasehold Improvements $0.00
Equipment, Furn & Fixtures $0.00
Total Fixed Assets $0.00
Less: Accumulated Depreciation $0.00
Net Fixed Assets $0.00
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Other Long Term Assets:
Debt Issuance Costs $0.00
Patents (Net of Amortization) $82,747.12
$ 82,747.12
TOTAL ASSETS $ 97,381.87
==================
LIABILITIES
Post Petition Liabilities
Accounts Payable (from Form 2E) $630,844.93
Less: Pre-Petition $588,709.90 $42,132.03
-----------
Accrued Fees & Expenses $141,290.99
Accrued Interest Payable $38,420.85
Accrued - AFG II $70,000.00
Loans & Notes Payable to Directors $23,100.00
Total Post Petition Liabilities $314,943.37
Pre-Petition Liabilities:
Priority Claims
Secured Debt $403,950.22
Unsecured Debt $1,751,038.57
Total Pre-Petition Liabilities $2,154,988.79
TOTAL LIABILITIES $2,469,932.66
==================
OWNERS' EQUITY
Capital Stock $87,826.14
Paid-In Capital $21,312,720.30
Preferred Stock $500,000.00
Preferred Stock Dividends ($86,055.56)
Stock Subscriptions $325,000.00
Treasury Stock ($563,750.00)
Retained Earnings:
Pre-Petition ($21,029,172.61)
Pre- Petition Net Income (1/1-11/11/02) ($1,986,496.80)
Post Petition Net Income (11/12/02-08/31/04) ($932,622.26)
TOTAL OWNERS' EQUITY ($2,372,550.79)
TOTAL LIABILITIES AND OWNERS' EQUITY $ 97,381.87
==================
Form 2-D
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 MER
PROFIT AND LOSS STATEMENT
For Period August 1 to August 31, 2004
Gross Operating Revenue $0.00
Less: Discounts, Returns and Allowances $0.00
Net Operating Revenues $0.00
Cost of Goods Sold $0.00
Gross Profit $0.00
Operating Expenses:
Salaries and Wages $0.00
Rents and Leases $85.00
Payroll Taxes $0.00
Advertising & Promotion $0.00
Auto Expense $0.00
Bank Charges $10.14
Contract Labor $1,000.00
Computer Repairs & Maintenance $0.00
Employee Incentives/Med Benefits $0.00
Equipment Rentals $0.00
Insurance Expense $0.00
Lender Expenses $42.22
Licenses & Fees $0.00
Miscellaneous and Other $0.00
Office Funishings & Supplies/Printing $40.95
Payroll Service $0.00
Press Releases $0.00
Regulatory Compliance Exp (SEC, etc.) $317.00
Sales and Property Taxes $0.00
Telephone/Fax/Internet $0.00
Transfer Agent Fees $75.00
Trash Removal & Utilities $0.00
Travel and Entertainment $0.00
Total Operating Expenses $1,570.31
Operating Income (Loss) ($1,570.31)
Legal and Professional Fees $558.56
Depreciation, Depletion and Amortization $700.00
Interest Expense $2,098.41
Net Operating Income (Loss) ($4,927.28)
Non-Operating Income and Expenses
Other Non-Operating (Expenses) $0.00
Gains (Losses) on Sale of Assets $0.00
Interest Income $0.00
Other Non-Operating Income $0.00
Net Non-Operating Income or (Expenses) $0.00
Net Income (Loss) Before Income Taxes ($4,927.28)
Federal and State Income Tax Expense (Benefit) $0.00
NET INCOME (LOSS) ($4,927.28)
==================
Form 2-E
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO. 02-28289 MER
Quarterly Fee Summary (1)
Month Ended August 31, 2004
Month Cash Disbursements (2) Quarterly Fee Due Check No. Date
- ----- ---------------------- ----------------- --------- ----
January $1,692.35
February $1,447.47
March $1,493.50
Total 1st Qtr $4,633.32 $250.00 2065 4/16/2004
April $1,776.66
May $3,227.93
June $1,426.92
Total 2nd Qtr $6,431.51 $250.00 2076 7/15/2004
July $1,812.56
August $1,528.09
September $0.00
Total 3rd Qtr $3,340.65 $0.00
October $0.00
November $0.00
December $0.00
Total 4th Qtr $0.00 $0.00
(1) This summary is to reflect the current calendar year's information
cumulative to the end of the reporting period.
(2) Should agree with line 3, Form 2-B. Disbursements are net of transfers to
other debtor in possession bank accounts.
Form 2-F
Rev 10/01/01
DEBTOR: In Store Media Systems, Inc. CASE NO: 02-28289 MER
NARRATIVE
For Period August 1 to August 31, 2004
1. The Debtor has filed a plan of reorganization with the Bankruptcy Court.
2. The Debtor anticipates that a hearing will be held in October 2004 before
the Bankruptcy Court regarding the Debtor's plan of reorganization and
proposed disclosure statement. There may be additional hearings before the
Bankruptcy Court after this October hearing.
3. There can be no assurance regarding (i) the final terms of any plan of
reorganization that may be undertaken by the Debtor (if any) of (ii) that
the Debtor will be successful in either obtaining approval of any plan of
reorganization or in implementing any plan of reorganization.
Form 2-G
Rev 10/01/01
In Store Media Systems, Inc.
Bank Reconciliation Worksheet
Month of: July 2004
New Operating DIP Acct # 823-6331735
Acct # 1 Balance per Bank $11,788.42
Add:
Deposits in Transit $0.00
Less:
Checks Outstanding
Mini U Storage 2085 $85.00
Balance per Books $11,703.42