<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) November 15, 1998
2CONNECT EXPRESS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
FLORIDA
-------------------------------
(State or other jurisdiction of
incorporation or organization)
000-22251 65-0674664
- ------------------------------------ ------------------------------------
(Commission file number) (I.R.S. Employer Identification No.)
2055 Lakes Avenue SE, Suite A 33771
------------------------------------------------ ------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (813) 584-7902
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
3500 Gateway Drive, Suite 101, Pompano Beach, FL 33069
------------------------------------------------ ------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (954) 797-7960
- --------------------------------------------------------------------------------
<PAGE> 2
Item 5. OTHER EVENTS
On November 15, 1998, 2Connect Express, Inc. filed with the United States
Bankruptcy Court the Debtor's Monthly Financial Report (Business) for the
period from October 4, 1998 to October 31, 1998. A copy of this report is filed
as Exhibit 99 hereto.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
Exhibit 99. Debtor's Monthly Financial Report (Business) For the
Period From October 4, 1998 to October 31, 1998, filed
with the United States Bankruptcy Court.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
2CONNECT EXPRESS, INC.
----------------------------------------
(Registrant)
Date: November 18, 1998 /s/ James S. Holbrook, Jr.
----------------------------------------
James S. Holbrook, Jr., Chairman of the
Board and Chief Executive Officer
<PAGE> 4
EXHIBIT INDEX
Exhibit Number Description Sequentially Numbered Page
- -------------- ----------- --------------------------
99 Debtor's Monthly Financial Report 5
for the period from October 4,
1998 to October 31, 1998
<PAGE> 1
Exhibit 99
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA
FT LAUDERDALE DIVISION
IN RE: | CASE NUMBER: 98-20169-BKC-RBR
|
| JUDGE: Raymond B. Ray
DEBTOR. | CHAPTER 11
DEBTOR'S MONTHLY FINANCIAL REPORT (BUSINESS)
FOR THE PERIOD
FROM October 4, 1998 TO October 31, 1998 (Fiscal Month)
Comes now the above-named debtor and files its Periodic Financial
reports in accordance with the Guidelines established by the United
States Trustee and FRBP 2015.
Paul J. Battista, Esq.
Attorney for Debtor
Debtor's Address and Phone Number: Attorney's Address and Phone Number:
2Connect Express, Inc Kelley, Drye & Warren, LLP
3500 Gateway Drive 201 S. Biscayne Blvd.
Suite 101 2400 Miami Center
Pompano Beach, FL 33069 Miami, FL 33131
(954) 971-3555 (305) 372-2400
1 of 16
<PAGE> 2
MONTHLY FINANCIAL REPORT FOR BUSINESS
For the Period Beginning October 4, 1998 and
Ending October 31, 1998 (Fiscal Month)
Name of Debtor: 2Connect Express, Inc. Case Number: 98-20169-BKC-RBR
Date of Petition: January 12, 1998
<TABLE>
<CAPTION>
CUMULATIVE
CURRENT MONTH PETITION TO DATE
---------------- ---------------
<S> <C> <C>
1. Cash at Beginning of Period $ 682,539.47 $ 106,714.48
---------------- ---------------
2. Receipts:
A. Cash and Credit Card Sales 1,026,357.18
Less: Cash and Credit Card Refunds (1,333.83)
---------------- ---------------
Net Cash and Credit Card Sales -- 1,025,023.35
---------------- ---------------
B. Collection in Post-petition A/R 23,743.76 360,297.89
C. Collection on Pre-petition A/R 317,653.45
D. Other Receipts (Schedule 2A) 1,589.72 105,761.66
E. Deposits From Account Sweeps 28,034.69 4,111,804.00
F. Less Disbursement Sweeps (28,034.69) (4,110,961.41)
G. Bankruptcy Attorney trust account* (123,952.13) 222,773.71
---------------- ---------------
3. Total Receipts (98,618.65 2,032,352.65
---------------- ---------------
4. Total Cash Available for Operations(1+3) 583,920.82 2,139,067.13
---------------- ---------------
5. Disbursements:
A. U.S. Trustee Quarterly Fees 1,250.00 10,000.00
B. Net Payroll ** 18,443.11 460,899.20
C. Payroll Taxes Paid 7,589.71 164,960.89
D. Sales and Use Taxes 73.12 47,928.09
E. Other Taxes --
F. Rent 989.55 182,733.60
G. Other Leases (attachment 3) 34,327.68
H. Telephone 1,162.51 36,006.28
I. Utilities 624.92 19,951.23
J. Travel and Entertainment 30,030.99
K. Vehicle Expenses --
L. Office Supplies 296.72 6,566.44
M. Advertising 22,796.89
N. Insurance (attachment 7) 858.93 50,711.50
O. Purchases of Fixed Assets --
P. Purchases of Inventory 116,153.42
Q. Manufacturing Supplies --
R. Repairs and Maintenance 1,604.19
S. Payments to Secured Creditors 281,499.96
T. Other Operating Expenses (Schedule 2B) 290,527.74 410,792.26
---------------- ---------------
6. Total Cash Disbursements 321,816.31 1,876,962.62
---------------- ---------------
7. Ending Cash Balance (4-6) $ 262,104.51 $ 262,104.51
================ =============
</TABLE>
I declare under penalty of perjury that this statement and the accompanying
documents and reports are true and correct to the best of my knowledge and
belief.
This 15th day of November, 1998. Signed: /s/ Thomas H. Hicks
---------------------------------
Thomas H. Hicks
* Represents the net amount of transactions by the Disbursing Agent of the
Court, Kelley Drye and Warren. Transactions include collections on AR of
$175,000.00 plus a funds transfer of $286,000.00 from 2Connect to Kelley
Drye escrow account, interest income of $578.97 less accounts payable and
accrued expenses paid of $585,531.10.
** 2 pay periods plus post-petition vacation pay.
Page 2 of 16
<PAGE> 3
Schedule 2A
Monthly Financial Report for Business
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Other Receipts Detail
<TABLE>
<CAPTION>
Account Date Check # Received From Purpose Deposit
- ------- -------- ------- -------------------- -------- ---------------
<S> <C> <C> <C> <C> <C>
op 10/5/98 Deposit First Union Interest Interest $ 123.82
op 10/6/98 Deposit First Union Interest Interest 41.47
op 10/7/98 Deposit First Union Interest Interest 441.43
op 10/8/98 Deposit First Union Interest Interest 39.55
op 10/9/98 Deposit First Union Interest Interest 39.08
op 10/13/98 Deposit First Union Interest Interest 153.02
op 10/14/98 Deposit Pacey/Cobra Cobra 210.29
op 10/14/98 Deposit BellSouth Deposit Refund Credit Refund 806.46
op 10/14/98 Deposit First Union Interest Interest 40.61
op 10/15/98 Deposit First Union Interest Interest 41.18
op 10/16/98 Deposit First Union Interest Interest 5.96
op 10/19/98 Deposit First Union Interest Interest 14.07
op 10/30/98 Deposit Bolden/Cobra Cobra 32.78
--------------
$ 1,589.72
==============
</TABLE>
Page 3 of 16
<PAGE> 4
Schedule 2B
Monthly Financial Report for Business
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Other Operating Expenses Detail
<TABLE>
<CAPTION>
ACCOUNT DATE CHECK # PAYEE PURPOSE WITHDRAWL
- ------- -------- ------- --------------------------- ---------------- --------------
<S> <C> <C> <C> <C> <C>
op 10/5/98 Debit Merchant Fee Credit Card Fees $ 54.95
op 10/5/98 Debit Merchant Fee Credit Card Fees 15.00
op 10/6/98 Debit Merchant Fee Credit Card Fees (39.95)
op 10/6/98 Debit Merchant Fee Credit Card Fees (15.00)
op 10/9/98 013050 American Stock Transfer Co. Transfer Agent 500.00
op 10/9/98 013051 Bowne of Atlanta SEC Printing 480.18
op 10/9/98 013052 Telecheck Check Processing 36.05
op 10/9/98 013053 Worldwide Express Freight 95.90
op 10/9/98 013057 Web Store Internet 50.00
op 10/13/98 Debit Commercial Bank Fee Bank Fee 440.58
op 10/14/98 013060 Thomas H. Hicks Printing 31.90
op 10/14/98 013061 Bowne of Atlanta SEC Printing 1,686.46
op 10/14/98 013062 Federal Express Corporation Freight 14.50
op 10/14/98 013063 Worldwide Express Freight 29.80
op 10/15/98 Debit Wire to Kelley, Drye Escrow Court Ordered Transfer 286,000.00
pay 10/16/98 Debit ADP Fees Payroll Fees 70.01
op 10/26/98 013069 Thomas H. Hicks Printing 10.75
op 10/26/98 013071 Federal Express Corporation Freight 120.00
op 10/26/98 013072 PR Newswire, Inc. Press Release 61.50
pay 10/26/98 Debit ADP Fees Payroll Fees 61.50
op 10/30/98 013081 Bowne of Atlanta SEC Printing 969.90
op 10/30/98 013082 Federal Express Corporation Freight 12.50
op 10/31/98 012338 Void Check Void Check (137.79)
op 10/31/98 012600 Void Check Void Check (1.00)
op 10/31/98 012900 Void Check Void Check (8.00)
--------------
$ 290,527.74
==============
</TABLE>
Page 4 of 16
<PAGE> 5
ATTACHMENT #1
-------------
MONTHLY ACCOUNTS RECEIVABLE AGING AND RECONCILIATION
----------------------------------------------------
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Accounts Receivable at Petition Date: $ 375,266.67
Accounts Receivable Reconciliation (Include all accounts receivable,
pre-petition and post-petition, including charge card sales which have not been
received):
Beginning of Month Balance: $ 246,610.45
Plus: Current Month New Billings: 11,763.79
Less: Writeoffs against Pre-petition AP claims (18,598.00)
Less: Collections During Month (198,433.79) *
Accounts Written off --
---------------
End of Month Balance: $ 41,342.45
===============
* Includes payment directly to Escrow Agent, Kelley Drye of $175,000 by Sterne
Agee & Leach, Inc.
Aging: (show the total amount for each age group of accounts incurred since
filing the petition)
0-30 days 31-60 days 61-90 days >90 days Total
--------- ---------- ---------- -------- --------
SEE ATTACHED DETAIL
Page 5 of 16
<PAGE> 6
Attachment #1
2CONNECT EXPRESS, INC.
TRADE RECEIVABLES
AS OF 10-26-98
<TABLE>
<CAPTION>
TOTAL 1 TO 30 31 TO 60 61 TO 90 OVER 90
-------------- -------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C>
A/R - Commission
Bell South Local-Commission $ 1,217.50 $ -- $ -- $ -- $ 1,217.50
--------------------------------------------------------------------
Subtotal 1,217.50 -- -- 0.00 1,217.50
--------------------------------------------------------------------
A/R - In-House
Beepers to Go 8,662.00 2,960.00 5,702.00
School Board of Dade County 3,093.43 3,093.43
Ingram Retail Services 1,145.27 1,145.27
--------------------------------------------------------------------
Subtotal 12,900.70 -- -- 2,960.00 9,940.70
--------------------------------------------------------------------
A/R - Activation
Sprint - Activation 17,419.17 17,419.17
--------------------------------------------------------------------
Subtotal 17,419.17 -- -- -- 17,419.17
--------------------------------------------------------------------
A/R - Coop Advertising
Ericcson-Coop 600.08 600.08
Lucent Tech-Coop 176.00 176.00
Panasonic-Coop 292.00 292.00
Recoton-Coop 281.00 281.00
Smart Talk-Coop 640.00 640.00
Uniden-Coop 417.00 417.00
Vtech Coop Adv 7,255.00 7,255.00
--------------------------------------------------------------------
Subtotal 9,661.08 -- -- 2,406.08 7,255.00
--------------------------------------------------------------------
A/R - Rebate
Recoton Rebate 144.00 144.00
--------------------------------------------------------------------
Subtotal 144.00 -- -- 144.00 --
--------------------------------------------------------------------
Grand Total Accounts Receivable $ 41,342.45 $ -- $ -- $ 5,510.08 $ 35,832.37
====================================================================
</TABLE>
Note: Statements and Collection letters sent to all parties. Kelley Drye &
Warren advised to send final collection letters to all except Bobby
Allison Cellular Systems of Florida, Inc.
Page 6 of 16
<PAGE> 7
ATTACHMENT #2
-------------
MONTHLY ACCOUNTS PAYABLE AND SECURED PAYMENTS REPORT
----------------------------------------------------
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
In the space below list all invoices or bills incurred and not paid since the
filing of the petition. Do not include amounts owed prior to filing the
petition.
Date Days
Incurred Outstanding Vendor Description Amount
- -------- ----------- --------- ----------------- ----------
SEE ATTACHED SCHEDULE: "PERIOD CUTOFF AGED AP - HISTORICAL DETAIL AGED
BY DUE DATE"
ACCOUNTS PAYABLE RECONCILIATION (Post Petition Only):
Opening Balance (total from prior report) $ 161,868.19
Plus: New Indebtedness Incurred This Month 140,764.87
Less: Amount Paid on Total Accounts Payable * (319,343.33)
--------------
Ending Month Balance $ (16,710.27)
==============
* Includes amounts disbursed for legal fees by Kelley, Drye and Associates per
Court Approval.
SECURED: List status of payments to Secured Creditors and Lessors
(Post-Petition Only):
<TABLE>
<S> <C> <C> <C> <C>
Secured Date Number of Post Total Amount of
Creditor/ Payment Payment Petition Payments Post-petition
Lessor Due Amount Delinquent Payments Delinquent
--------- ------- ------- ----------------- -------------------
</TABLE>
NONE
Page 7 of 16
<PAGE> 8
2Connect Express, Inc.
Period Cutoff Aged AP (03.681. -- Historical Detail Aged by Due Date)
<TABLE>
<CAPTION>
Period: 09--99 Aging Date: 10/26/98
- -----------------------------------------------------------------------------------------------------------------------------
Vendor/ Name/ Vendor Status/ Disc Due Pay Days Past Due
Doc Type Ref Nbr Inv Nbr Inv Date Doc Status Date Date Date Current 1 To 30 31 To 60
- -------- ------- ------- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
4000RENAIS Renaissance Partners, LC O
CK 013080 005241 C (989.55)
Vendor Total (989.55) -- --
5000FEDEX Federal Express Corporation O
VO 005251 468694574 10/30/98 A 10/30/98 11/14/98 11/14/98 40.00 -- --
Vendor Total 40.00 -- --
6500EMPLOY Employer's Health Insurance O
CK 013073 005186 C (36.39)
Vendor Total (36.39) -- --
6500FORTIS Fortis Life Insurance O
CK 013074 005235 C (8.50)
Vendor Total (8.50) -- --
6500HUMANA Humana Health Insurance O
CK 013085 005240 C (322.83)
Vendor Total (322.83) -- --
6500KEMPER Kemper Insurance Companies H
AD 004970 3BG0159400 6/15/98 A 6/15/98 6/15/98 -- -- --
AD 005028 060198 6/1/98 A 6/1/98 6/1/98 -- -- --
AD 005030 061998 6/19/98 A 6/19/98 6/19/98 -- -- --
AD 005031 062998 6/29/98 A 6/29/98 6/29/98 -- -- --
AD 005032 062198 6/21/98 A 6/21/98 6/21/98 -- -- --
AC 005104 082098 8/20/98 A 8/20/98 8/20/98 8/20/98 -- -- --
Vendor Total -- -- --
7200WEBSTO We Sstore O
VO 005250 103198 10/31/98 A 10/31/98 11/10/98 11/10/98 25.00 -- --
Vendor Total 25.00 -- --
Report Total (1,292.27) -- --
<CAPTION>
Days Past Due
61 To 90 Over 90 Balance
- -------------------------------------
<C> <C> <C>
(989.55)
-- -- (989.55)
-- -- 40.00
-- -- 40.00
(36.39)
-- -- (36.39)
(8.50)
-- -- (8.50)
(322.83)
-- -- (322.83)
-- (2,187.00) (2,187.00)
-- (2,677.00) (2,677.00)
-- (2,641.00) (2,641.00)
-- (611.00) (611.00)
-- (9,139.00) (9,139.00)
1,837.00 -- 1,837.00
1,837.00 (17,255.00) (15,418.00)
-- -- 25.00
-- -- 25.00
1,837.00 (17,255.00) (16,710.27)
</TABLE>
Note 1 -- Negative balances are due to invoices paid in October in advance of
the calendar month (November 1st) the expense is recorded, except for
Kemper Insurance which is an Insurance refund that is due to
2Connect.
Page 8 of 16
<PAGE> 9
ATTACHMENT #3
INVENTORY AND FIXED ASSETS REPORT
- --------------------------------------------------------------------------------
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
INVENTORY REPORT
Inventory Balance at Petition Date: $2,191,354
==========
Inventory Reconciliation:
Inventory Balance at Beginning of Month (Period) $ --
Inventory Purchased During Month (Period) --
Inventory Used or Sold: --
Less Inventory liquidations via court approved auctions --
Less Inventory writedowns to liquidation values --
----------
Inventory On-Hand at End of Month (Period) $ --
==========
Method of Costing: Last Cost
FIXED ASSET REPORT
Fixed Assets Fair Market Value at Petition Date: $2,038,164 NBV
(includes Property, Plant and Equipment) ==========
Fixed Assets Reconciliation:
Fixed Asset Book Value at Beginning of Month (Period): $ --
Less: Adjustment to books recording anticipated sale to BAC --
Depreciation Expense for Period: --
Court Approved Sales --
Adjustment to estimated remaining asset values --
Plus: New Purchases/Additions: --
----------
Ending Month (Period) Balance per books: $ --
==========
Page 9 of 16
<PAGE> 10
ATTACHMENT #4
MONTHLY BANK ACCOUNT RECONCILIATION
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Separate sheet is required for each bank account, including all savings and
investment accounts (I.e., certificates of deposits, money market accounts,
stocks and bonds, etc.)
NAME OF BANK: FIRST UNION NATIONAL BANK BRANCH: COMMERCIAL BANKING BROWARD
ACCOUNT NAME: 2CONNECT EXPRESS, INC. DIP OPERATING ACCOUNT
ACCOUNT NUMBER: 2090002563870
PURPOSE OF ACCOUNT: POST PETITION OPERATING ACCOUNT
Beginning Balance $ 341,136.36
Total of Deposits Made 25,333.48
Amount of Deposits from Account Sweeps (See Note Below) --
Amount of Receipts from Account Sweeps (See Note Below) --
Amount of Cash funding Payroll Account (28,034.69)
Total Amount of Checks Written (295,672.49)
--------------
Closing Balance $ 42,762.66
==============
Number of 1st Check Written This Period: 013049
Number of Last Check Written This Period: 013089
------
Total Number of Checks Written or voided This Period: 41
======
Note - Daily "Sweep" transfers are made from store depository sub-accounts
(zero balance accounts) to concentration account.
INVESTMENT ACCOUNTS
Type of Negotiable Face Purchase Date of
Instrument Value Price Purchase
- ------------------ ----------- ----------- -------------
NONE
Page 10 of 16
<PAGE> 11
ATTACHMENT #4
MONTHLY BANK ACCOUNT RECONCILIATION
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Separate sheet is required for each bank account, including all savings and
investment accounts (I.e., certificates of deposits, money market accounts,
stocks and bonds, etc.)
NAME OF BANK: FIRST UNION NATIONAL BANK BRANCH: COMMERCIAL BANKING BROWARD
ACCOUNT NAME: 2CONNECT EXPRESS, INC. DIP PAYROLL ACCOUNT
ACCOUNT NUMBER: 2090002563883
PURPOSE OF ACCOUNT: POST PETITION PAYROLL ACCOUNT
Beginning Balance $(5,322.73)
Total of Deposits Made 28,034.69
Total Amount of Checks Written (26,143.82)
Service Charges
----------
Closing Balance $(3,431.86) ------> Since this is a Zero
========== Balance account, negative
balances represent
outstanding checks.
Number of 1st Check Written This Period: 1975
Number of Last Check Written This Period: 1979
-------
Total Number of Checks Written This Period: 5
=======
INVESTMENT ACCOUNTS
Type of Negotiable Face Purchase Date of
Instrument Value Price Purchase
- ------------------ --------- ----------- ------------
NONE
Page 11 of 16
<PAGE> 12
ATTACHMENT #5
CHECK REGISTER
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
NAME OF BANK: FIRST UNION NATIONAL BANK BRANCH: COMMERCIAL BANKING BROWARD
ACCOUNT NAME: 2CONNECT EXPRESS, INC. DIP OPERATING ACCOUNT
ACCOUNT NUMBER: 2090002563870
PURPOSE OF ACCOUNT: PRIMARY OPERATING ACCOUNT
Account for all check numbers, including voided, lost, stopped payment, etc.
<TABLE>
<CAPTION>
Date Ck # Payee Purpose Amount
- ------- ------ --------------------------- ----------------------- -----------
<S> <C> <C> <C> <C>
10/5/98 Debit Merchant Fee Credit Card Fee $ 54.95
10/5/98 Debit Merchant Fee Credit Card Fee 15.00
10/6/98 Debit Merchant Fee Credit Card Fee (39.95)
10/6/98 Debit Merchant Fee Credit Card Fee (15.00)
10/9/98 013049 Void Check Void Check --
10/9/98 013050 American Stock Transfer Co. Transfer Agent 500.00
10/9/98 013051 Bowne of Atlanta SEC Printing 480.18
10/9/98 013052 Telecheck Check Processing Fee 36.05
10/9/98 013053 Worldwide Express Freight 95.90
10/9/98 013054 Florida Power & Light Utilities 624.92
10/9/98 013055 Cartridge Crafter, Inc. Office Supplies 63.49
10/9/98 013056 Kahn Carlin Insurance 451.21
10/9/98 013057 Web Store Internet Service 50.00
10/9/98 013058 Void Check Void Check --
10/9/98 013059 Renaissance Partners, LC Office Supplies 169.68
10/13/98 Debit Commercial Bank Fee Bank Fee 440.58
10/14/98 013060 Thomas H. Hicks Printing 31.90
10/14/98 013061 Bowne of Atlanta SEC Printing 1,686.46
10/14/98 013062 Federal Express Corporation Freight 14.50
10/14/98 013063 Worldwide Express Freight 29.80
10/14/98 013064 BellSouth Telephone 721.49
10/14/98 013065 Florida Department of Revenue Sales Tax 73.12
10/15/98 Debit Wire to Kelley, Drye Escrow Court Ordered Transfer 286,000.00
10/16/98 013066 Void Check Void Check --
10/16/98 013067 United States Trustee Trustee Fee 1,250.00
10/16/98 013068 Kemper Insurance Companies Insurance 40.00
10/26/98 013069 Thomas H. Hicks Printing 70.01
10/26/98 013070 Renaissance Partners, LC Telephone 241.02
10/26/98 013071 Federal Express Corporation Freight 10.75
10/26/98 013072 PR Newswire, Inc. Press Releases 120.00
10/26/98 013073 Employer's Health Insurance Insurance 36.39
10/26/98 013074 Fortis Life Insurance Insurance 8.50
10/26/98 013075 Void Check Void Check --
10/26/98 013076 Void Check Void Check --
10/26/98 013077 Void Check Void Check --
10/26/98 013078 Void Check Void Check --
10/26/98 013079 Void Check Void Check --
10/30/98 013080 Renaissance Partners, LC Rent 989.55
10/30/98 013081 Bowne of Atlanta SEC Printing 969.90
10/30/98 013082 Federal Express Corporation Freight 12.50
10/30/98 013083 BellSouth Telephone 200.00
10/30/98 013084 Cartridge Crafter, Inc. Office Supplies 63.55
10/30/98 013085 Humana Health Insurance Insurance 322.83
10/30/98 013086 Void Check Void Check --
10/30/98 013087 Void Check Void Check --
10/30/98 013088 Void Check Void Check --
10/30/98 013089 Void Check Void Check --
10/31/98 012338 Void Check Void Check Previously Recorded (137.79)
10/31/98 012600 Void Check Void Check Previously Recorded (1.00)
10/31/98 012900 Void Check Void Check Previously Recorded (8.00)
-----------
$295,672.49
===========
</TABLE>
Page 12 of 16
<PAGE> 13
ATTACHMENT #5
CHECK REGISTER
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
NAME OF BANK: FIRST UNION NATIONAL BANK BRANCH: COMMERCIAL BANKING BROWARD
ACCOUNT NAME: 2CONNECT EXPRESS, INC. DIP PAYROLL ACCOUNT
ACCOUNT NUMBER: 2090002563883
PURPOSE OF ACCOUNT: PAYROLL ACCOUNT
Account for all check numbers, including voided, lost, stopped payment, etc.
Date Ck # Payee Purpose Amount
- -------- ----- --------------------- ------------- ----------
10/31/98 1587 Void Check 1587 Net Pay $ (0.33)
10/16/98 1975 Hicks, Thomas Net Pay * 13,502.46
10/16/98 1976 Chalfant, Christopher Net Pay 461.75
10/16/98 1977 Kinsey, Jeanine Net Pay * 1,108.87
10/16/98 Debit ADP Fees Payroll Fees 49.50
10/16/98 Debit ADP Taxes Payroll Taxes 7,198.90
10/26/98 Debit ADP Taxes Payroll Taxes 390.81
10/26/98 1978 Hicks, Thomas Net Pay 2,985.48
10/26/98 1979 Kinsey, Jeanine Net Pay 384.88
10/26/98 Debit ADP Fees Payroll Fees 61.50
----------
$26,143.82
==========
* Includes vacation earned in 1998
Page 13 of 16
<PAGE> 14
ATTACHMENT #6
MONTHLY TAX REPORT
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
TAXES PAID DURING THE MONTH (PERIOD)
Report all post-petition taxes paid directly or deposited into the tax account.
<TABLE>
<CAPTION>
Date Bank or Payee Description Amount
- -------- ----------------------------- ------------------------------------------------- ----------
<S> <C> <C> <C>
10/14/98 Florida Department of Revenue Consolidated Sales Tax Return for September, 1998 $ 73.12
10/16/98 IRS and Fla Dept of Rev PR taxes deposited by ADP 7,198.90
10/26/98 IRS and Fla Dept of Rev PR taxes deposited by ADP 390.81
----------
$ 7,662.83
==========
</TABLE>
<TABLE>
<CAPTION>
TAXES OWED AND DUE
Report all unpaid post-petition taxes including Federal and State withholding
FICA, State sales tax, property tax, unemployment tax, and State workmen's
compensation. Date last tax return filed: See Above
Name of Taxing Date Pmt.
Authority Due Description Amount
- ----------------- --------- ---------------------------- ---------
<S> <C> <C> <C>
Palm Beach County 11/30/98 1998 Personal Property Taxes $ 4,004.16
Palm Beach County 11/30/98 1998 Personal Property Taxes 1,347.95
Broward County 11/30/98 1998 Personal Property Taxes 294.55
Broward County 11/30/98 1998 Personal Property Taxes 8,225.50
Broward County 11/30/98 1998 Personal Property Taxes 5,012.88
Broward County 11/30/98 1998 Personal Property Taxes 5,064.62
Broward County 11/30/98 1998 Personal Property Taxes 10,649.14
Miami Dade County 11/30/98 1998 Personal Property Taxes 2,561.70
Miami Dade County 11/30/98 1998 Personal Property Taxes 2,003.09
----------
$39,163.59
==========
</TABLE>
Page 14 of 16
<PAGE> 15
ATTACHMENT #7
SUMMARY OF OFFICER OR OWNER COMPENSATION
SUMMARY OF PERSONNEL AND INSURANCE COVERAGES
Name of Debtor: 2CONNECT EXPRESS, INC. Case Number: 98-20169-BKC-RBR
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
Report all compensation received during the period. Do not include reimbursement
for expenses incurred for which you have receipts.
<TABLE>
<CAPTION>
Amount
Officer or Owner Name Title Paid
------------------------- ------------ -----------
<S> <C> <C>
Thomas H. Hicks (Resigned as officer effective 8-27-98) Interim General Manager $23,282.50 *
</TABLE>
* Includes 1998 vacation earned through final payroll date.
<TABLE>
<CAPTION>
PERSONNEL REPORT Store Corporate
--------------------- ---------------------
Full Time Part Time Full Time Part Time Total
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Number of Employees at Beginning of Period -- -- -- 2 2
Number Hired during Period -- -- -- -- --
Number Terminated or Resigned during Period -- -- -- (2) (2)
---------------------------------------------------------
Number of Employees on payroll at end of Period -- -- -- -- --
=========================================================
</TABLE>
CONFIRMATION OF INSURANCE
List all policies of insurance in effect, including but not limited to worker's
compensation, liability, fire, theft, comprehensive, vehicle, health and life.
<TABLE>
<CAPTION>
Agent & Policy Type of Expiry Premium
Carrier Phone # Number Coverage Date Due Date
- ------- --------------------------- ---------- ------------------------------ ---------- --------
<S> <C> <C> <C> <C> <C>
Agricultural Excess & Surplus Kahn-Carlin & Company, Inc. NSP2108136 Directors & Officers Liability (See Note) Paid
Roy Fabry
Telephone (954) 767-6066
Reliance Insurance Company Kahn-Carlin & Company, Inc. QB8615829 Commercial Application, 11/9/98 Monthly
Property, General Liability,
Business Auto, Garage & Dealers,
Crime, Umbrella
Kemper-American Motorists Ins. Kahn-Carlin & Company, Inc. 3BG01594400 Workers Compensation 10/12/98 Dropped
CAN Kahn-Carlin & Company, Inc. 0000685C Employment Related Prac Liab 9/11/98 Dropped
Humana, Inc. Humana, Inc. Group #133739 Employee Health and Life 11/30/98 Monthly
Stacey Granger
Phone (800) 442-5555
</TABLE>
The Workers Compensation and Employment Related Practices policies were dropped
by the new owners.
Directors & Officers Liability Insurance was extended only through 10/27/98.
Page 15 of 16
<PAGE> 16
ATTACHMENT #8
SIGNIFICANT DEVELOPMENTS DURING REPORTING PERIOD
For the Period Beginning October 4, 1998 and Ending October 31, 1998
(Fiscal Month)
On October 7, 1998, the Company filed an Amendment to the Debtor's Monthly
Financial Report (Business) for the period August 2, 1998 to August 29, 1998
reclassifying the Sterne Agee new value payment from cash in escrow to Accounts
Receivable.
On October 16, 1998 the court confirmed the Company's Plan of Reorganization
which became effective on October 27, 1998 pursuant to the Order of
Confirmation of the Plan of Reorganization entered on October 16, 1998. On
October 16, 1998, the Company issued a press release pursuant to the above.
On October 26, 1998, 2Connect Express, Inc. filed a Civil Action in the Circuit
Court of the 17th Judicial Circuit in and for Broward County, Florida against
certain former Officers and Directors of the Company, alleging breach of
fiduciary duty and negligence in connection with conduct of the Plaintiffs
business during 1997.
Page 16 of 16
