UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Sections 13 and 15(d) of
the Securities Exchange Act of 1934
November 18, 1998
Date of Report (Date of earliest event reported)
SA TELECOMMUNICATIONS, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-18048 75-2258519
(State Of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
1600 Promenade Center, 15th Floor
Richardson, TX 75080
(Address of Principal Executive Office)
(972) 690-5888
(Registrant's Telephone Number, Including Area Code)
(Not Applicable)
(Former Name or Former Address,
if Changed Since Last Report)
<PAGE>
ITEM 5. OTHER EVENTS
As previously reported, SA Telecommunications, Inc. and its
subsidiaries (collectively, the "Company") filed petitions for relief under
Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code") in the
United States Bankruptcy Court for the District of Delaware (the "Bankruptcy
Court") (Cases No. 97-2395 through 97-2401). Since that date, the Company has
continued as a debtor-in-possession pursuant to the Bankruptcy Code.
On November 18, 1998, the Company filed its Monthly Operating Report
for the month ending July 31, 1998 (the "July MOR") with the Office of the
United States Trustee (the "Trustee") and the Bankruptcy Court.
A copy of the July MOR is attached hereto as Exhibit 99.1 and
incorporated herein by reference.1
1 The attachments and exhibits referenced in the July MOR are not attached
as part of Exhibit 99.1, but are available at the Office of the United
States Trustee and the Bankruptcy Court. In addition, the Company agrees
that it will furnish a copy of any omitted schedule or similar attachment
to the Commission upon its request.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits:
99.1 Monthly Operating Report of the Company for the month ending July
31, 1998.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SA TELECOMMUNICATIONS, INC.
DATE: November 23, 1998 By: /s/ Albert B. Gordon, Jr.
-------------------------
Albert B. Gordon, Jr.
Chief Executive Officer
Accrual Basis-1
Case No.: 97-02395PJW Thru 97-02401PJW
OFFICE OF THE UNITED STATES TRUSTEE - REGION 3
MONTHLY OPERATING REPORT
for the month ending July, 1998
Document Previously Explanation
Required Attachments: Attached Submitted Attached
1. Tax Receipts ( ) (X) ( )
2. Bank Statements (X) ( ) ( )
3. Most recently filed ( ) (X) ( )
Income Tax Return
4. Most recent Annual (X) ( ) ( )
Financial Statements
prepared by accountant
IN ACCORDANCE WITH TITLE 28, SECTION 1746, OF THE UNITED STATES CODE, I DECLARE
UNDER PENALTY OF PERJURY THAT I HAVE EXAMINED THE FOLLOWING MONTHLY OPERATING
REPORT (ACCRUAL BASIS - 1 THROUGH ACCRUAL BASIS - 9) AND THE ACCOMPANYING
ATTACHMENTS AND, TO THE BEST OF MY KNOWLEDGE, THESE DOCUMENTS ARE TRUE, CORRECT
AND COMPLETE. DECLARATION OF PREPARER (OTHER THAN RESPONSIBLE PARTY) IS BASED ON
ALL INFORMATION OF WHICH PREPARER HAS ANY KNOWLEDGE.
RESPONSIBLE PARTY:
/s/ Windle R. Ewing Vice President
- --------------------------------- ------------------------------
SIGNATURE OF RESPONSIBLE PARTY TITLE
Windle R. Ewing October 27, 1998
- --------------------------------- ------------------------------
PRINTED NAME OF RESPONSIBLE PARTY DATE
PREPARER:
/s/ Tom Matta Accounting Manager
- --------------------------------- ------------------------------
SIGNATURE OF PREPARER TITLE
Tom Matta October 27, 1998
- ------------------------------ ------------------------------
PRINTED NAME OF PREPARER DATE
All Chapter 11 debtors must file this report with the Court and serve a
copy on the United States Trustee no later than the 15th day of the
month following the end of the month covered by the report.
<PAGE>
In Re: SA Telecommunications, Inc. Accrual Basis -2
Case Nos. 97-2395 (PJW) through 97-2401 (PJW)
COMPARATIVE BALANCE SHEET
ASSETS Month
7/31/98
1 Cash $ 1,056,766
2 Accounts Receivable (Net) 941,460
3 Inventory 34,190
4 Notes Receivable -
5 Prepaid Expenses 15,900
6 Other (Attach List) -
7 Total Current Assets 2,048,316
8 Property, Plant & Equipment 10,454,992
9 Less: Accumulated
Depreciation/Depletion 5,811,127
10 Net Property, Plant & Equipment 4,643,865
11 Due From Affiliates & Insiders -
12 Intangibles (Attach List) -
12a Debt Issuance Cost -
13 Other (Attach List) 2,024,310
14 Total Assets 8,716,491
POSTPETITION LIABILITIES
15 Accounts Payable 5,206,974
15a Accrued Telecommunications Costs 1,224,449
16 Taxes Payable -
16a Accrued Taxes Payable -
17 Notes Payable -
18 Professional Fees -
19 Secured Debt -
20 Due To Affiliates & Insiders -
21 Other (Attach List) -
22 Total Postpetition Liabilities 6,431,423
PREPETITION LIABILITIES
23. Secured Debt 4,267,093
24. Priority Debt (Attach List) 91,675
24a Redeemable Preferred Stock 1,620,000
25 Unsecured Debt 47,444,030
26 Other (Attach List) -
27 Total Prepetition Liabilities 53,422,798
28 Total Liabilities 59,854,221
EQUITY
29 Owner's Prepetition Equity (12,258,875)
30 Postpetition Cumulative
Profit or (Loss) (38,878,855)
31. Total Equity (Deficit) (51,137,730)
32 Total Liabilities & Owner's Equity $ 8,716,491
<PAGE>
In Re: SA Telecommunications, Inc. Accrual Basis-2
Case Nos. 97-2395 (PJW) THROUGH 97-2401 (PJW)
Month
7/31/98
6 Other Current Assets
--------------------
A/R-Jack Matz 0
A/R Prarie Systems, Inc. 0
A/R Line Costs 0
Long Distance Network N/R 0
-------------
0
=============
12 Intangibles
-----------
Goodwill (net of amortization) 0
=============
13 Other Non-Current Assets
------------------------
Prepaid Employee Settlement (net) 0
Security Deposits & Miscellaneous 2,024,310
-------------
2,024,310
=============
21 Other Post-Petition Liabilities
-------------------------------
Accr Payroll/Payroll Taxes/Benefits 0
Accr Medical Ins 0
Accr Property Taxes 0
-------------
0
=============
24 Priority Debt
-------------
Accrued Payroll/Employee Benefits 20,513
Accrued Property Taxes 71,162
Accrued Sales Taxes 0
-------------
91,675
=============
<PAGE>
Case No. Nos.-2395 (PJW) THROUGH 97-2401 (PJW) Accrual Basis -3
SA TELECOMMUNICATIONS, INC.
INCOME STATEMENT
Month
July, 1998
REVENUES
1 Gross Revenues 1,016,898
2 Less: Returns & Discounts 1,011
3 Net Revenue 1,015,887
COST OF GOODS SOLD
4 Beginning Inventory
5 Add: Purchases
6 Less: Ending Inventory
7 Cost Of Goods Sold 862,300
8 Gross Profit 153,587
OPERATING EXPENSES
9 Officer/Insider Compensation 65,021
10 Direct Labor/Salaries 203,381
11 Payroll Taxes 19,329
12 Rent & Lease Expense 26,427
13 Insurance 6,642
14 Depreciation/Amortization -
15 General & Administrative 34,334
16 Other (Attach List) -
17 Total Operating Expenses 355,134
18 Operating Income (201,547)
OTHER INCOME & EXPENSES
19 Other Income (Attach List)
20 Other Expenses (Attach List)
21 Interest Expense (24,897)
22 Other
23 Net Other Income & Expenses (24,897)
REORGANIZATION EXPENSES
24 Professional Fees
25 U.S. Trustee Fees (32,934)
26 Other (Attach List)
27 Total Reorganization Expenses
28 Income Tax
29 NET PROFIT (LOSS) (259,378)
<PAGE>
Case Nos. 97-2395 (PJW) THROUGH 97-2401 (PJW) Accrual Basis -4
CASH RECEIPTS AND
DISBURSEMENTS
<TABLE>
<CAPTION>
TOTAL SATEL TOTAL SATEL TOTAL SATEL TOTAL SATEL
A/P MAIN OPER. P/R GREYROCK
<S> <C> <C> <C> <C>
1. BEG. BAL (251,026.05) 503,911.19 (70,866.52) 95,934.13
2. CASH - - - -
SALES
3. RECEIPTS - 946,597.20 - -
4. LOANS & - - - -
ADVANCES
5. SALE - - - - -
ASSETS
6. (OTHER)
PAYDOWNS
ON
REVOLVER 170,964.88 808,427.89 240,979.52 (95,934.13)
------------- ------------ ------------ -------------
7. TOTAL
RECEIPTS 170,964.88 1,755,025.09 240,979.52 (95,934.13)
8. TOTAL
CASH AVAIL. (80,061.17) 2,258,936.28 170,113.00 -
------------- ------------ ------------ -------------
- .
*DISBURSE-
MENTS - (1,849,712.05) (163,843.51) -
EOM
BALANCE (80,061.17) 409,224.23 6,269.49 -
------------- ------------ ------------ -------------
TOTAL SATEL TOTAL SATEL TOTAL SATEL TOTAL SATEL
MISC. CD & NEC PETTY CASH
<S> <C> <C> <C> <C>
1. BEG. BAL 140,048.91 40,867.47 4,062.00 462,931.13
2. CASH - - - -
SALES
3. RECEIPTS - - - 946,597.20
4. LOANS & - - - -
ADVANCES
5. SALE - - - -
ASSETS
6. (OTHER)
PAYDOWNS
ON
REVOLVER 27,293.12 555,355.62 - 1,707,086.90
------------- ------------- ------------- -------------
7. TOTAL
RECEIPTS 27,293.12 555,355.62 - 2,653,684.10
8. TOTAL
CASH AVAIL. 167,342.03 596,223.09 4,062.00 3,116,615.23
------------- ------------- ------------- -------------
*DISBURSE-
MENTS (46,293.72) - - (2,059,849.28)
EOM
BALANCE 121,048.31 596,223.09 4,062.00 1,056,765.95
------------- ------------- ------------- -------------
</TABLE>
* See attached detail of disbursements by check number, date, payee and amount.
<PAGE>
Debtor: SA Telecommunications, Inc. and Subsidiaries Accrual Basis-5
Case No: 97-2395 through 97-2401
ACCOUNTS RECEIVABLE AGING
0 - 30 days old $ 941,460
31 - 60 days old -
61 - 90 days old -
91 + days old -
Total Accounts Receivable $
941,460
Amount Considered Uncollectable -
Account Receivable $
941,460
<TABLE>
<CAPTION>
AGING OF POSTPETITION ACCOUNTS PAYABLE
0 - 30 31 - 60 61 - 90 91+
DAYS DAYS DAYS DAYS TOTAL
- ---------------------- ------------------ ------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C> <C>
ACCOUNTS PAYABLE $ 5,206,974 $ - $ - $ - $ 5,206,974
</TABLE>
<TABLE>
<CAPTION>
STATUS OF POSTPETITION TAXES
BEGINNING AMOUNT ENDING
TAX WITHHELD AMOUNT TAX DELINQUENT
LIABILITY* OR ACCRUED* PAID LIABILITY TAXES
<S> <C> <C> <C> <C> <C>
FEDERAL
Withholding** 19,398 56,839 11,579 64,659
FICA-Employee** 11,488 16,787 7,416 20,859
FICA-Employer** 11,488 16,787 7,416 20,859
Unemployment 1,006 27 27 1,006
Income
Other (Attach List)
Total Federal Taxes 43,380 90,441 26,438 107,382 -
STATE AND LOCAL
- ---------------
Withholding 2,722 4,330 1,603 5,449
Sales 509,750* 78,413 78,413 509,750
Excise
Unemployment 6,714 191 191 6,714
Real Property
Personal Property
Other (Attach List)
Total State & Local 519,186 82,934 80,207 521,913 -
Total Taxes 562,566 173,374 106,645 629,295 -
</TABLE>
* The beginning liability for state and local sales tax includes an
adjustment for $260,817 reclassed from prepetition sales tax
* The beginning tax liability should represent the liability from the prior
month or, if this is the first operating report. the amount should be zero.
** Attach photocopies of IRS Form 6123 or your FTD coupon and payment receipt
to verify payment or deposit
<PAGE>
<TABLE>
<CAPTION>
Case Nos. 97-972395 (PJW) THROUGH 02401 (PJW) SA TELECOMMUNICATIONS, INC. ACCRUAL BASIS - 6
BANK RECONCILIATIONS Acct #1 Acct #2 Acct #3 Acct #4 Acct #5
USC USC USC NEC LDN
A. Bank Wells Fargo Wells Fargo Wells Fargo Various Southwest Bank
B. Acct # 4311-269112 4311-269120 4311-269138 Various 9050078
C. Purpose A/P Operating Payroll Misc. Savings
--- --------- ------- Depository -------
------
<S> <C> <C> <C> <C> <C>
1 Balance per Bank - 364,646.65 - 572,824.93 2,516.96
Statement
2 + Deposits not credited - - 6.65
3 - Outstanding Checks (64,436.98) - (2,705.75) -
-
4 +/- Other Reconciling 1,571.99 41,296.13 -
items 28,809.48 -
============== ================ ============== ================ ===============
5 Month End Balance per (62,864.99) 405,942.78 26,103.73 572,824.93 2,523.61
books
============== ================ ============== ================ ===============
BANK RECONCILIATIONS Acct #6 Acct #7 Acct #8 Acct #9
USC USC USC AddTel
A. Bank Compass Wells Fargo na Wells Fargo
B. Acct # 712-0018-3 4311-269146 Petty 690018810
C. Purpose Greyrock Insurance Cash Accounts Sales Tax Acct
-------- --------- ------------- --------------
<S> <C> <C> <C> <C>
1 Balance per Bank 85,960.18 586.43 11,333.44
Statement 87,408.35
2 + Deposits not credited
3 - Outstanding Checks - (1,598.14) - (2,741.56)
4 +/- Other Reconciling 21,633.31 - 6,461.08
items (87,408.35)
================ =============== ================= ===============
5 Month End Balance per - 105,995.35 586.43 15,052.96
books
================ =============== ================= ===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Case Nos. 97-2395 (PJW) THROUGH 972401 (PJW) SA TELECOMMUNICATIONS, INC. ACCRUAL BASIS - 6
BANK RECONCILIATIONS Acct #10 Acct #11 Acct #12 Acct #13 Acct #14
AddTel AddTel AddTel AddTel AddTel
A. Bank Wells Fargo Wells Fargo Wells Fargo Wells Fargo Wells Fargo
B. Acct # 0933 051211 1290-000025-000 4443-332515 4443-332762 0933 041063
C. Purpose Operating CD Greyrock Returned Checks -
--------- -- -------- ---------------
<S> <C> <C> <C> <C> <C>
1 Balance per Bank 30,904.90 20,874.55 - - -
Statement
2 + Deposits not credited
3 - Outstanding Checks (35,540.89)
4 +/- Other Reconciling (9,278.74) - -
items
============== ================= ============= ================ ===============
5 Month End Balance per (13,914.73) 20,874.55 - - -
books
============== ================= ============= ================ ===============
BANK RECONCILIATIONS Acct #15 Acct #16 Acct #17 Acct #18
AddTel AddTel Uniquest Uniquest
A. Bank Wells Fargo na Compass Bank of
America
B. Acct # 934 041063 711 9526 0 83130 00519
C. Purpose Payroll/ZBA Petty Cash A/P Payroll
----------- ---------- --- -------
<S> <C> <C> <C> <C>
1 Balance per Bank - 3,475.57 - -
Statement
2 + Deposits not credited
3 - Outstanding Checks - - -
4 +/- Other Reconciling - -
items (19,834.34)
================ =============== ================= ===============
5 Month End Balance per (19,834.34) 3,475.57 - -
books
================ =============== ================= ===============
</TABLE>
<PAGE>
Case Nos. 97-2395 (PJW) THROUGH 972401 (PJW) ACCRUAL BASIS - 7
SA Telecommunications, Inc.
and Subsidiaries
OF THE TOTAL DISBURSEMENTS SHOWN FOR THE MONTH, LIST THE AMOUNT PAID TO INSIDERS
(AS DEFINED IN SECTION 101 (31) (A)-(F) OF THE BANKRUPTCY CODE) AND TO
PROFESSIONALS FOR PAYMENTS TO INSIDERS, IDENTIFY THE TYPE OF COMPENSATION PAID
(e.g. SALARY, BONUS, COMMISSION, INSURANCE, HOUSING ALLOWANCE, TRAVEL CAR
ALLOWANCE, ETC.) ATTACH ADDITIONAL SHEETS IF NECESSARY.
Insiders
<TABLE>
<CAPTION>
Cumulative
Type of Amount Unpaid
Name Position Payment Paid Balance
<S> <C> <C> <C> <C> <C>
1 Igor Mamantov VP-Corp Development Payroll Resigned
2 Dennis Lee Gundy VP-Operations Bonus $ 24,000.00
3 Jeffery M. Petrie VP-Telemarketing Bonus 9,750.00
4 Windle R. Ewing VP-Tariffs and Reg. Affair Payroll/Bonus 16,270.76
5 Thomas J. Brighi VP-Telemarketing Payroll Resigned
6 George M. Trevino Controller Payroll Resigned
7 Kellie Watts Asst. General Counsel Payroll Resigned
8 Julie Judd HR Administrator Payroll Resigned
9 Cheryl Leahy Asst. Controller Payroll Resigned
10 Chuck Leblo Bonus 15,000.00
Total Payments to Insiders $ 65,020.76
</TABLE>
<TABLE>
<CAPTION>
PROFESSIONALS
Date of Court Total
Type of Order Authorizing Amount Amount Paid
Name Professional Payment Approved Paid To Date
---------------- --------------------- --------------------- -------------- --------------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
1
2 None None None None None
3
4
Total Payments to Professionals
</TABLE>
Adequate Protections Payments
Scheduled Monthly Amounts Paid Total Unpaid
Name of Creditor Payments Due During the Month Post Petition
1 None None -
2
3
4
5
Total $ - $ -
<PAGE>
97-02395PJW THRU 97- 02401PJW ACCRUAL BASIS-8
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------ ---------- ----------
QUESTIONNAIRE YES NO
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
<S> <C> <C> <C>
1. Have any assets been sold or transferred outside the normal course of
business this recording period? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
2. Have any funds been disbursed from any account other
than a debtor in possession account? X (1)
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
3. Are any postpetition receivables (accounts, notes, or
loans) due from related parties? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
4. Have any payments been made on prepetition liabilities
this reporting period? X (2)
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
5. Have any postpetition loans been received by the debtor
from any party? X (3)
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
6. Are any postpetition payroll taxes past due? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
7. Are any postpetition state or federal income taxes past
due? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
8. Are any postpetition real estate taxes past due? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
9. Are any other postpetition taxes past due? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
10. Are any amounts owed to postpetition creditors past due?
X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
11. Have any prepetition taxes been paid during the
reporting period? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
12. Are any wage payments past due? X
- ------------------------------------------------------------------------------------ ---------- ----------
If the answer to any of the above questions is "YES", provide a detailed
explanation of each item. Attach additional sheets if necessary.
(1) Prepetition accounts retained during this period per court order. (2) Only
items such as payroll and benefits approved by court order. (3) Only amounts per
D.I.P. Financing Agreement approved by court order.
- ------------------------------------------------------------------------------------ ---------- ----------
INSURANCE YES NO
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
<S> <C> <C> <C>
1. ARE WORKER'S COMPENSATION, GENERAL LIABILITY AND OTHER NECESSARY
INSURANCE COVERAGES IN EFFECT? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
2. ARE ALL PREMIUM PAYMENTS PAID CURRENT? X
- ------------------------------------------------------------------------------------ ---------- ----------
- ------------------------------------------------------------------------------------ ---------- ----------
3. PLEASE ITEMIZE POLICIES BELOW.
- ------------------------------------------------------------------------------------ ---------- ----------
</TABLE>
If the answer to any of the above questions is "no", or if any policies have
been canceled or not renewed during this reporting period, provide an
explanation below. Attached additional sheets if necessary.
- -----------------------------------------------------------------------------
INSURANCE POLICIES
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
TYPE OF PAYMENT AMOUNT
POLICY CARRIER PERIOD COVERED & FREQUENCY
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
See attached schedule of current policies.
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<PAGE>
Case Nos. 97-2395(PJW) THROUGH 97-2401(PJW) Accrual Basis -9
SA Telecommunications, Inc.
and Subsidiaries
- --------------------------------------------------------------------------------
Personnel
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Full Time Part Time
Total Total
1. Total number of employees at beginning of period 30 -
2. Total number of employees hired during the period - -
3. Number of employees terminated or resigned during 25 -
the period
4. Total number of employees on payroll at end of 5 -
period
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Change of Address
- --------------------------------------------------------------------------------
If your mailing address has changed and you have not previously notified
the United States Trustee of the change, list your new address below:
DATE OF CHANGE: ______________________
NEW ADDRESS:
