<PAGE>
As filed with the Securities and Exchange Commission on March 3, 1998
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):
February 20, 1998
FRETTER, INC.
(Exact name of registrant as specified in its charter)
Michigan 0-14611 38-1557359
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification Number)
incorporation)
12501 Grand River
Brighton, Michigan 48116
(Address of principal executive offices) (Zip Code)
(810) 220-5000
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
- ---------------------
Fretter, Inc. (the "Company") is filing herewith the Monthly Operating
Reports of Debtors and Debtors in Possession for the Period Ended January 31,
1998 that the Company filed with the United States Bankruptcy Court for Northern
District of Ohio, Eastern Division on February 20, 1998 in connection with the
Company's ongoing proceeding under chapter 11 of the United States Bankruptcy
Code (11 U.S.C. Sections 101-1330), Case No. 96-15177.
Item 7. Exhibits.
- ------------------
(c) Exhibits.
--------
99.1 Monthly Operating Reports of Debtors and Debtors in Possession
for the Period Ended January 31, 1998 (1)
- -------------
(1) The Company agrees to furnish supplementally a copy of any omitted schedule
or similar attachment to the Commission upon its request.
-2-
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned thereunto duly authorized.
FRETTER, INC.
By /s/ J. Michael McLean
--------------------------------------
J. Michael McLean
Controller
Date: March 3, 1998
-3-
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibit Sequential
Number Document Description Page Number
- --------- ------------------------------------------- -----------
<S> <C> <C>
99.1 Monthly Operating Reports of Debtors and
Debtors in Possession for the Period Ended
January 31, 1998
===================================================================
</TABLE>
-4-
<PAGE>
EXHIBIT 99.1
TRANSMITTAL OF FINANCIAL REPORTS AND
CERTIFICATION OF COMPLIANCE WITH
UNITED STATES TRUSTEE OPERATING REQUIREMENTS FOR
THE PERIOD ENDED: 1-31-98
IN RE: :
CASE NO: 96-15177
Fretter, Inc. : Chapter 11
Judge Morgenstern-Clarren
:
- ------------------------------------
Debtor
:
As debtor in possession, I affirm:
1. That I have reviewed the financial statements attached hereto, consisting
of:
X Operating Statement (Form 2)
-----
X Balance Sheet (Form 3)
-----
X Summary of Operations (Form 4)
-----
X Monthly Cash Statements (Form 5)
-----
X Statement of Compensation (Form 6)
-----
----- -----------------------------------------
and that they have been prepared in accordance with normal and customary
accounting practices, and fairly and accurately reflect the debtor's financial
activity for the period stated:
2. That the insurance as described in Section 4 of the Operating Instructions
and Reporting Requirements for Chapter 11 Cases is in effect; and, (if not,
attach written explanation)
3. That all postpetition taxes as described in Sections 1 and 14 of the
Operating Instructions and Reporting Requirements For Chapter 11 cases are
current. (If not, attach written explanation)
4. No professional fees (attorney, accountant, etc.) have been paid without
specific court authorization. Explain on separate sheet if not true.
I hereby certify, under penalty of perjury, that the information provided herein
is true and correct to the best of my information and belief.
Dated: 2/13/98 /s/ J. Michael McLean
--------------------------
Debtor in Possession
Controller 810-220-5007
---------- ------------
Title Phone
<PAGE>
OPERATING STATEMENT (P&L)
-------------------------
(Accrual Basis)
---------------
Debtor: Fretter Inc. Case No: 96-15177
Month Ending: 1/31/98
<TABLE>
<CAPTION>
Total
Current Month Since Filing
<S> <C> <C>
Total Revenue/Sales 0 532,663
Cost of Sales 0 505,226
---------- -----------
Gross Profit 0 27,437
========== ===========
EXPENSES:
--------
Officer Compensation 8,321 293,534
Salary Expenses other Employees 9,975 369,683
Court-Ordered Stay Bonus 50,000 212,921
Employee Benefits & Pensions 0
Payroll Taxes 7,370 69,174
Other Taxes 87,574
Rent and Lease Expense 10,898 54,704
Interest Expense 94,637 4,160,968
Insurance 11,513 550,168
Automobile and Truck Expense 0
Utilities (gas, electric, phone alarms) 6,355 160,205
Depreciation 0
Travel and Entertainment 1,138 13,583
Repairs and Maintenance 37,483 285,696
Advertising 0
Supplies, Office Expenses, etc. 15,652 279,899
Other: Specify Director & Trustee Fees 10,316 122,635
Other: Specify Misc. Fees 3,095
---------- -----------
TOTAL EXPENSES: 263,658 6,663,839
---------- -----------
NET OPERATING PROFIT/(LOSS) (263,658) (6,636,402)
========== ===========
Add: Non-Operating Income:
Interest Income 2,596 25,990
Gain/Loss on Sale of Real Estate 729,126 7,898,270
Other Income 21,056 1,858,463
---------- -----------
TOTAL 752,778 9,782,723
---------- -----------
Less: Non-Operating Expenses:
Professional Fees 202,500 2,419,973
Other (6,186) 614,096
---------- -----------
NET INCOME / (LOSS) 292,806 111,442
========== ===========
</TABLE>
<PAGE>
BALANCE SHEET *
-------------
Debtor: Fretter, Inc. Case No: 96-15177
Month Ending: 1/31/98
<TABLE>
<CAPTION>
ASSETS: Current Month Prior Month At Filing
<S> <C> <C> <C>
Cash: 1,075,400 958,714 89,252
Inventory: 791,999
Accounts Receivable: ** 34,574,714 34,574,764 35,930,804
Insider Receivables 7,414,781 7,414,781 7,424,547
Land and Buildings: 13,686,742 19,500,676 49,365,801
Furniture, Fixtures & Equip: 418,000
Accumulated Depreciation: (2,647,975) (4,751,853) (10,623,681)
Other: Prepaids & misc. 1,140,653 937,682 807,689
Other: Utility deposits 37,205 39,000
----------- ----------- -----------
TOTAL ASSETS: 55,281,520 58,673,764 84,204,411
=========== =========== ===========
LIABILITIES:
Postpetition Liabilities:
Accounts Payable: 87,316 136,792
Wages and Salaries: 9,595 8,912
Taxes Payable: 82,936 112,626
Other: 1,796,762 1,728,936 1,390
----------- ----------- -----------
TOTAL Postpetition Liab. 1,976,609 1,987,266 1,390
=========== =========== ===========
Secured Liabilities:
Subject to Postpetition
Collateral or Financing Order 4,488,035 7,912,174 29,002,401
All other Secured Liab. 2,817,328 3,064,067 7,371,875
----------- ----------- -----------
TOTAL Secured Liabilities: 7,305,363 10,976,241 36,374,276
=========== =========== ===========
Prepetition Liabilities:
Taxes & Other Priority Liab. 885,638 879,195 1,132,770
Unsecured Liabilities 6,464,815 6,512,730 6,849,397
Other: Accrued Liabilities 4,627,432 4,642,358 5,449,917
----------- ----------- -----------
TOTAL Prepetition Liab. 11,977,885 12,034,283 13,432,084
=========== =========== ===========
Redeemable Preferred Stock 48,265,040 48,265,040 48,265,040
----------- ----------- -----------
Equity:
Owners' Capital: 1,692,451 1,692,451 1,692,451
Retained Earnings-Pre Pet. (16,047,270) (16,100,153) (15,560,830)
Retained Earnings-Post Pet. 111,442 (181,364) 0
----------- ----------- -----------
TOTAL Equity: (14,243,377) (14,589,066) (13,868,379)
=========== =========== ===========
TOTAL LIABILITIES
AND EQUITY: 55,281,520 58,673,764 84,204,411
=========== =========== ===========
</TABLE>
______________________________
* Preliminary Estimate
** Includes contingent receivable from Silo, Inc.
Collectibility indeterminate
<PAGE>
SUMMARY OF OPERATIONS
---------------------
Period Ended: 1/31/98
Debtor: Fretter, Inc. Case No: 96-15177
Schedule of Postpetition Taxes Payable
--------------------------------------
<TABLE>
<CAPTION>
Beginning Accrued/ Payments/ Ending
Balance Withheld Deposits Balance
---------- -------- --------- --------
<S> <C> <C> <C> <C>
Income Taxes Withheld:
Federal: (1,018) 16,954 15,936 0
State: 559 2,966 559 2,966
Local:
FICA Withheld: 0 5,205 5,205 0
Employers FICA: 0 5,205 5,205 0
Unemployment Tax:
Federal: 2 183 2 183
State: 327 1,995 339 1,983
Sales, Use & Excise Taxes: 0 0
Property Taxes: 112,756 3,578 38,530 77,804
Workers' Compensation
Other:
------- ------ ------- -------
TOTALS 112,626 36,086 65,776 82,936
======= ====== ======= =======
</TABLE>
AGING OF ACCOUNTS RECEIVABLE
AND POSTPETITION ACCOUNTS PAYABLE
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Age in Days 0-30 30-60 Over 60
PostPetition
Accounts Payable ______ ______ ______
Accounts Receivable ______ ______ ______
</TABLE>
For all postpetition accounts payable over 30 days old, please attach a sheet
listing each such account, to whom the account is owed, the date the account was
opened, and the reason for non-payment of the account.
Describe events or factors occurring during this reporting period materially
affecting operations and formulation of a Plan of Reorganization.
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
<PAGE>
MONTHLY CASH STATEMENT
Debtor: Fretter, Inc. Statement for the period:
Case #: 96-15177 From: 1-1-98 To: 1-31-98
Cash Activity Analysis (Cash Basis Only):
<TABLE>
<CAPTION>
General Payroll Tax Cash Coll. B.T.
Acct. Acct. Acct. Acct. B.T. Direct(1)
------- ------- ----- ---------- ---------
<S> <C> <C> <C> <C> <C>
A. Beginning Balance: 179,127.88 9,667.79 5,816.83 0.00 0.00
---------- --------- --------- ---------- ----------
B. Receipts. Attach
Separate Schedule: 264,911.05 42,862.36 32,494.23 0.00 346,765.98
---------- --------- --------- ---------- ---------
C. Balance Available
(A + B): 444,038.93 52,530.15 38,311.06 0.00 346,765.98
---------- --------- --------- ---------- ----------
D. Less Disbursements
Attach Separate
Schedule: 156,057.26 42,862.36 27,244.38 0.00 346,765.98
---------- --------- --------- ---------- ----------
E. ENDING BALANCE
(C-D) 287,981.67 9,667.79 11,066.68 0.00 0.00
---------- --------- --------- ---------- ----------
(PLEASE ATTACH COPIES OF MOST RECENT RECONCILED BANK STATEMENTS FROM EACH
ACCOUNT)
General Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38120-0
Payroll Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38024-4
Tax Account:
1. Depository Name & Location Michigan National Bank, Brighton, MI
2. Account Number 4707-38128-3
</TABLE>
Other monies on hand (specify type and location) (i.e., CD's petty cash):
BT Collateral Acct. - Old Kent Bank, Acct. No 229377
BT Direct - BT cash collateral is forwarded directly to B.T.
Date:
-----------------------
Debtor in Possession
<PAGE>
MONTHLY CASH STATEMENT
----------------------
Debtor: Fretter, Inc. Statement for the period:
-------------
Case No.: 96-15177 From: 1-1-98 To: 1-31-98
------------- ------------- -----------
Cash Activity Analysis (Cash Basis Only):
<TABLE>
<CAPTION>
General Tax
Savings Savings
Acct. Acct.
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
A. Beginning Balance: 764,101.21 0.00 0.00
---------- ---------- ---------- ---------- ----------
B. Receipts. Attach Separate Schedule: 2,595.82 0.00
---------- ---------- ---------- ---------- ----------
C. Balance Available (A+B): 766,697.03 0.00 0.00 0.00 0.00
---------- ---------- ---------- ---------- ----------
D. Less Disbursements Attach separate
schedule: 12.76 0.00
---------- ---------- ---------- ---------- ----------
E. Ending Balance (C-D): 766,684.27 0.00 0.00 0.00 0.00
---------- ---------- ---------- ---------- ----------
</TABLE>
(PLEASE ATTACH COPIES OF MOST RECENT RECONCILED BANK STATEMENTS FROM EACH
ACCOUNT)
General Savings Account
1. Depository Name & Location Michigan National Bank, Brighton, MI
----------------------------------------
2. Account Number 4707-38293-5
----------------------------------------
Tax Savings Account
1. Depository Name & Location Michigan National Bank, Brighton, MI
----------------------------------------
2. Account Number 4707-38357-8
----------------------------------------
Other monies on hand (specify type and location)(i.e., CD's petty cash):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date:
-------------------- ----------------------------------------
Debtor in Possession
FORM 5
-ix-
<PAGE>
MONTHLY STATEMENT OF COMPENSATION
---------------------------------
The following information is to be provided for each shareholder,
officer, director, manager, insider, or owner that is employed by the debtor in
possession. Attach additional pages if necessary.
Name: J. Michael McLean Capacity: Principal
------
X Officer
------
Director
------
Insider
------
Detailed Description of Duties: As Controller, directs accounting, payroll,
benefit plans and tax filings as well as assists in cash flow planning
Current Compensation Paid:
Weekly or Monthly
9,167.00
------ --------
Current Benefits Received:
Weekly or Monthly
Vacation Pay ------ --------
Holiday Pay ------ --------
Retirement ------ --------
Company Vehicle ------ --------
Entertainment ------ --------
Travel ------ --------
Other Benefits ------ --------
CURRENT TOTAL:
Weekly or Monthly
------ --------
Dated: ------------------------------------
-------------------- Principal, Officer, Director, Insider
<PAGE>
LIST OF OMITTED SCHEDULES
1. Schedule of Michigan National Bank January 1998 Cash Receipts (Account
Number 4707-38120-0)
2. Schedules of Michigan National Bank January 1998 Cash Disbursements,
Account Reconciliation and Outstanding Check List (Account Number 4707-38120-0)
3. Michigan National Bank Statement of Account for the Period January 1, 1998
to January 31, 1998 (Account Number 4707-38120-0)
4. Michigan National Bank Statement of Account for the Period January 1, 1998
to January 31, 1998 (Account Number 4707-38024-4)
5. Schedules of Michigan National Bank Payroll Account January 1998 Cash
Receipts and Disbursements and Account Reconciliation (Account Number
4707-38024-4)
6. Schedules of Michigan National Bank Tax Account January 1998 Cash Receipts
and Disbursements and Account Reconciliation (Account Number 4707-38128-3)
7. Michigan National Bank Statement of Account for the Period January 1, 1998
to January 31, 1998 (Account Number 4707-38128-3)
8. Schedule of Bankers Trust January 1998 Cash Receipts
9. Schedules of Michigan National Bank General Savings Account January 1998
Cash Receipts and Disbursements (Account Number 4707-38293-5)
10. Michigan National Bank Statement of Account for the Period January 1, 1998
through January 31, 1998 (Account Number 4707-38293-5)
11. Schedule of Michigan National Bank Tax Savings Account January 1998 Cash
Receipts and Disbursements (Account Number 4707-38357-8)
12. Michigan National Bank Statement of Account for the Period January 1, 1998
to January 31, 1998 (Account Number 4707-38357-8)
