<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
F O R M 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report
April 26, 1999
--------------
Solo Serve Corporation
----------------------
(Exact name of registrant as specified in its charter)
Delaware
--------
(State or other jurisdiction of incorporation)
0-19994 74-2048057
------- ----------
(Commission File Number) (I.R.S. Employer Identification Number)
1610 Cornerway Blvd.
San Antonio, Texas 78219
-------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(210) 662-6262
--------------
<PAGE> 2
ITEM 5. OTHER EVENTS
As reported in the Form 8-K for January 20, 1999, Solo Serve
Corporation (the "Company") filed a voluntary petition on January 20, 1999 under
Chapter 11 of the Bankruptcy Code, Case No. 99-50272-C (the "Filing"), in the
United States Bankruptcy Court, Western District of Texas, San Antonio Division,
Bankruptcy Judge Ronald B. King presiding (the "Bankruptcy Court"). Since the
Filing, Solo Serve Corporation, has acted as Debtor in Possession and continued
to operate and manage its affairs.
On April 26, 1999, the Company reported that it had completed
liquidation of all of its inventory and that it had sold certain of its leases.
Those leases not sold or assigned have been rejected in accordance with
applicable provisions of the United States Bankruptcy Code. The Company's only
assets remaining unsold consist of office equipment, furniture and computers;
warehouse equipment and fixtures; store fixtures; and other miscellaneous
assets. These remaining items will be sold at auction at the Company's
headquarters on Wednesday and Thursday, April 29 and 30th, 1999, beginning at
10:00 a.m. each day. The Company's headquarters are located at 1610 Cornerway
Boulevard, San Antonio. The Company's headquarters will be open Tuesday, April
27, 1999 beginning at 10:00 a.m. to permit interested bidders to preview the
items to be sold. For more information regarding the auction, interested parties
may contact Pat of Investment Recovery Group at (210) 662-6262, ext. 200.
The Company also announced that the Bankruptcy Court entered an order
on April 26, 1999 granting the Company's Motion to Terminate Registration of
Securities, and the Company expects to promptly file a Form 15 with the
Securities and Exchange Commission, the effect of which will be to relieve the
Company of the ongoing expense, including legal, audit and other miscellaneous
costs, associated with the obligation to make periodic filings under the
Securities and Exchange Act of 1934. Deregistration of the Company's common
stock will be effective 90 days after filing of the Form 15; however, the
Company is relieved of the obligation to file periodic reports effective upon
the filing of the Form 15. It is expected that the Company's common stock will
no longer be available for trading on the NASDAQ Bulletin Board as a result of
filing of the Form 15.
The Company is presently engaged in resolving disputed claims in the
Bankruptcy Court, a process which is expected to take at least sixty to ninety
days. After resolution of disputed claims and after payment of administrative
claims and other priority claims, the Company intends to distribute any
remaining funds to unsecured creditors. No assurance can presently be given as
to the timing or amount of distributions, if any, to unsecured creditors. The
interests of holders of the Company's common and preferred stock will be
afforded no value in connection with the liquidation of the Company's assets.
In addition, on April 26, 1999, the Company filed, in the Bankruptcy
Court, a Monthly Operating Report Summary for March, 1999, a copy of which has
been filed as Exhibit 99.1 to this Report.
<PAGE> 3
Forward-looking Statements
Forward-looking statements in this Report are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. There
are certain important factors that could cause results to differ materially from
those anticipated by some of the statements made above. Investors are cautioned
that all forward-looking statements involve risks and uncertainty. Among the
principal uncertainties facing the Company at this time are uncertainty
regarding the amounts likely to be realized from sale of the Company's remaining
assets and the costs associated with the bankruptcy process. The Company does
not undertake to publicly update or revise its forward-looking statements even
if experience or future changes make it clear that any projected results
expressed or implied therein will not be realized.
Copies of the bankruptcy petition and other pleadings may be obtained
by contacting the Office of the Clerk of the United States Bankruptcy Court for
the Western District of Texas, San Antonio Division, 615 E.
Houston Street, San Antonio, Texas 78205, (210) 472-6720.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The Monthly Operating Report Summary for the Month of March, 1999, is
filed as Exhibit 99.1 to this Report.
(c) Exhibits. The following exhibits are filed as part of this report:
<TABLE>
<CAPTION>
Number Document
------ --------
<S> <C>
99.1 Monthly Operating Report Summary for the Month of
March, 1999, as filed with the Bankruptcy Court on
April 26, 1999.
</TABLE>
<PAGE> 4
SIGNATURES
Pursuant to the requirement 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.
SOLO SERVE CORPORATION
By: /s/ Ross E. Bacon
----------------------------------------
Ross E. Bacon,
Secretary and Chief Financial Officer
Dated: April 26, 1999
<PAGE> 5
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
99.1 Monthly Operating Report Summary for the Month of
March, 1999, as filed with the Bankruptcy Court on
April 26, 1999.
</TABLE>
<PAGE> 1
MOR-1 UNITED STATES BANKRUPTCY COURT
<TABLE>
<S> <C>
CASE NAME: Solo Serve Corporation PETITION DATE: 1/20/99 0:00
-------------------------------- ----------------
CASE NUMBER: 99-50272-K DISTRICT OF TEXAS: Western
-------------------------------- ----------------
PROPOSED PLAN DATE: DIVISION: San Antonio
----------------------------- ----------------
</TABLE>
<TABLE>
<CAPTION>
MONTHLY OPERATING REPORT SUMMARY FOR MONTH YEAR
- --------------------------------------------------------------------------------------------------------------------------------
Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
REVENUES (MOR-6) 7,450,583 3,426,613 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------------
INCOME BEFORE INT; DEPREC./TAX (MOR-6) (520,593) (313,601) 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) (MOR-6) (602,110) (771,091) 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------------
PAYMENTS TO INSIDERS (MOR-9) 91,532 49,039 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------------
PAYMENTS TO PROFESSIONALS (MOR-9) 40,000 7,500 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS (MOR-8) 7,270,126 2,152,055 0 0 0 0
================================================================================================================================
</TABLE>
***The original of this document must be filed with the United States
Bankruptcy Court and a copy must be sent to the United States Trustee***
<TABLE>
<CAPTION>
- ------------------------------------------------
REQUIRED INSURANCE MAINTAINED
AS OF SIGNATURE DATE EXP.
DATE
- ------------------------------- -------------
<S> <S> <S> <S>
CASUALTY YES(X) NO( ) 2/1/00
LIABILITY YES(X) NO( ) 2/1/00
VEHICLE YES( ) NO(X) N/A
WORKER'S YES(X) NO( ) 2/1/00
OTHER YES(X) NO( ) various
- ------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
CIRCLE ONE
Are all accounts receivable being collected within terms? (Yes) No
Are all post-petition liabilities, including taxes, being paid within terms? (Yes) No
Have any pre-petition liabilities been paid? (Yes) No
If so, describe Health insurance premiums, insurance note payments, wages
---------------------------------------------------------
Are all funds received being deposited into DIP bank accounts? (Yes) No
Were any assets disposed of outside the normal course of business? (Yes) No
If so, describe Sale of store fixtures, sale of inventory to liquidator,
sale of supplies, sale of leases
---------------------------------------------------------
Are all U.S. Trustee Quarterly Fee Payments current? (Yes) No
What is the status of your Plan of Reorganization? Not filed
------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C>
ATTORNEY NAME: Deborah D. Williamson I certify under penalty of perjury that the following complete
--------------------------------------------- Monthly Operating Report (MOR), consisting of MOR-1 through
FIRM NAME: Cox & Smith Incorporated MOR-9 plus attachments, is true and correct.
---------------------------------------------
ADDRESS: 112 E. Pecan
---------------------------------------------
Suite 1800
---------------------------------------------
CITY, STATE, ZIP: San Antonio, Texas 78205 SIGNED /s/ KATHRYN M. KOCH Title: Controller
--------------------------------------------- ----------------------------- -----------------
TELEPHONE: 210/554-5500 (ORIGINAL SIGNATURE)
---------------------------------------------
Kathryn M. Koch 4-22-99
---------------------------------- -----------------
MOR-1 (PRINT NAME OF SIGNATORY) DATE Revised 07/01/98
</TABLE>
Page 1
<PAGE> 2
CASE NAME: Solo Serve Corporation
------------------------------
CASE NUMBER: 99-50272-K
---------------
<TABLE>
<CAPTION>
COMPARATIVE BALANCE SHEETS
========================================================================================================================
ASSETS FILING DATE* MONTH MONTH MONTH MONTH MONTH MONTH
1/20/99 0:00 Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
CURRENT ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Cash 746,525 1,431,418 1,396,536
- ------------------------------------------------------------------------------------------------------------------------
Accounts Receivable, Net 86,882 508,330 342,545
- ------------------------------------------------------------------------------------------------------------------------
Inventory: Lower of Cost or Market 7,867,697 2,557,473 0
- ------------------------------------------------------------------------------------------------------------------------
Prepaid Expenses 322,456 281,229 118,778
- ------------------------------------------------------------------------------------------------------------------------
Other Receivables 121,649 162,126 162,126
- ------------------------------------------------------------------------------------------------------------------------
Other Note Receivable 65,810 60,377 57,602
- ------------------------------------------------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 9,211,019 5,000,953 2,077,587 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------------------------------
PROPERTY, PLANT & EQUIP. @ COST 2,883,824 1,379,509 377,677
- ------------------------------------------------------------------------------------------------------------------------
Less Accumulated Depreciation
- ------------------------------------------------------------------------------------------------------------------------
NET BOOK VALUE OF PP & E 2,883,824 1,379,509 377,677 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS
- ------------------------------------------------------------------------------------------------------------------------
1. Tax Deposits
- ------------------------------------------------------------------------------------------------------------------------
2. Investments in Subsidiaries
- ------------------------------------------------------------------------------------------------------------------------
3. Other
- ------------------------------------------------------------------------------------------------------------------------
4. Other
- ------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 12,094,843 6,380,462 2,455,264 0 0 0 0
========================================================================================================================
* Per Schedules and Statement of Affairs
</TABLE>
MOR-2 Revised 07/01/98
Page 2
<PAGE> 3
CASE NAME: Solo Serve Corporation
----------------------------------
CASE NUMBER: 99-50272-K
---------------
<TABLE>
<CAPTION>
COMPARATIVE BALANCE SHEETS
================================================================================================================================
LIABILITIES & OWNER'S FILING DATE* MONTH MONTH MONTH MONTH MONTH MONTH
EQUITY 1/20/99 0:00 Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES
- --------------------------------------------------------------------------------------------------------------------------------
POST-PETITION LIABILITIES(MOR-4) $ 3,795,411 $ 802,042
- --------------------------------------------------------------------------------------------------------------------------------
PRE-PETITION LIABILITIES
- --------------------------------------------------------------------------------------------------------------------------------
Notes Payable - Secured $ 4,585,000 $ 0 $ 0
- --------------------------------------------------------------------------------------------------------------------------------
Priority Debt $ 436,121 $ 436,121 $ 436,121
- --------------------------------------------------------------------------------------------------------------------------------
Federal Income Tax $ 0
- --------------------------------------------------------------------------------------------------------------------------------
FICA/Withholding $ 0
- --------------------------------------------------------------------------------------------------------------------------------
Unsecured Debt $ 10,971,168 $ 11,522,481 $ 11,378,393
- --------------------------------------------------------------------------------------------------------------------------------
Other Insurance Notes Payable $ 114,532 $ 71,896 $ 55,246
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL PRE-PETITION LIABILITIES $ 16,106,821 $ 12,030,498 $ 11,869,760 $0 $0 $0 $0
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES $ 16,106,821 $ 15,825,909 $ 12,671,802 $0 $0 $0 $0
- --------------------------------------------------------------------------------------------------------------------------------
OWNER'S EQUITY (DEFICIT)
- --------------------------------------------------------------------------------------------------------------------------------
PREFERRED STOCK $ 13,889 $ 13,889 $ 13,889
- --------------------------------------------------------------------------------------------------------------------------------
COMMON STOCK $ 28,562 $ 28,562 $ 28,562
- --------------------------------------------------------------------------------------------------------------------------------
ADDITIONAL PAID-IN CAPITAL $ 24,410,290 $ 24,410,290 $ 24,410,290
- --------------------------------------------------------------------------------------------------------------------------------
RETAINED EARNINGS: Filing Date $(33,296,078) $(33,296,078) $(33,296,078)
- --------------------------------------------------------------------------------------------------------------------------------
RETAINED EARNINGS: Post Filing Date $ (602,110) $ (1,373,201)
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL OWNER'S EQUITY (NET WORTH) $ (8,843,337) $ (9,445,447) $(10,216,538) $0 $0 $0 $0
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES &
OWNER'S EQUITY $ 7,263,484 $ 6,380,462 $ 2,455,264 $0 $0 $0 $0
================================================================================================================================
* Per Schedules and Statement of Affairs
</TABLE>
MOR-3 Revised 07/01/98
** Of the $3,795,411 in post-petition liabilities at the end of February,
$2,557,473 is unearned revenue from sale of inventory by liquidator.
Page 3
<PAGE> 4
CASE NAME: Solo Serve Corporation
----------------------------
CASE NUMBER: 99-50272-K
----------------
<TABLE>
<CAPTION>
SCHEDULE OF POST-PETITION LIABILITIES
==============================================================================================================================
MONTH MONTH MONTH MONTH MONTH MONTH
Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TRADE ACCOUNTS PAYABLE $ 319,182 $ 137,712
- ------------------------------------------------------------------------------------------------------------------------------
TAX PAYABLE
- ------------------------------------------------------------------------------------------------------------------------------
Federal Payroll Taxes $ 49,253 $ 311
- ------------------------------------------------------------------------------------------------------------------------------
State Payroll Taxes $ (330) $ (330)
- ------------------------------------------------------------------------------------------------------------------------------
Ad Valorem Taxes
- ------------------------------------------------------------------------------------------------------------------------------
Sales Taxes $ 426,151 $ 266,045
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL TAXES PAYABLE $ 475,074 $ 266,026 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------------------------------------
SECURED DEBT POST-PETITION
- ------------------------------------------------------------------------------------------------------------------------------
ACCRUED INTEREST PAYABLE
- ------------------------------------------------------------------------------------------------------------------------------
ACCRUED PROFESSIONAL FEES*
- ------------------------------------------------------------------------------------------------------------------------------
OTHER ACCRUED LIABILITIES
- ------------------------------------------------------------------------------------------------------------------------------
1. Accrued Payroll $ 81,597 $ 58,090
- ------------------------------------------------------------------------------------------------------------------------------
2. Accrued Ad Valorem Taxes *** $ 219,027 $ 219,027
- ------------------------------------------------------------------------------------------------------------------------------
3. Unearned revenue from sale of inventory $2,557,473 $ 0
- ------------------------------------------------------------------------------------------------------------------------------
4. Other miscellaneous accrued expenses $ 143,058 $ 121,187
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL POST-PETITION LIABILITIES (MOR-3) $3,795,411 $ 802,042 $0 $0 $0 $0
==============================================================================================================================
</TABLE>
* Payment requires Court Approval
MOR-4
Revised 07/01/98
*** Estimated accrual for all of 1999 ad valorem taxes.
Actual for Texas is now determined to be $26,703, and
will be adjusted in April.
Page 4
<PAGE> 5
MOR 5 MARCH
CASE NAME: Solo Serve Corporation
--------------------------
CASE NUMBER: 99-50272-K
--------------------------
AGING OF POST-PETITION LIABILITIES
MONTH March
----------------------
<TABLE>
<CAPTION>
=====================================================================================================================
DAYS TOTAL TRADE FEDERAL STATE AD VALOREM, OTHER
ACCOUNTS TAXES TAXES OTHER TAXES
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
0-30 767,982 103,652 311 265,715 219,027 179,277
- ---------------------------------------------------------------------------------------------------------------------
31-60 23,401 23,401
- ---------------------------------------------------------------------------------------------------------------------
61-90 10,217 10,217
- ---------------------------------------------------------------------------------------------------------------------
91+ 442 442
- ---------------------------------------------------------------------------------------------------------------------
TOTAL 802,042 137,712 311 265,715 219,027 179,277
=====================================================================================================================
</TABLE>
AGING OF ACCOUNTS RECEIVABLE
<TABLE>
<CAPTION>
================================================================================================================
MONTH TOTAL Customer Receivable from Other Misc Freight Claims
Receivables Liquidator
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
0-30 DAYS $ 340,583 $ 340,583
- ----------------------------------------------------------------------------------------------------------------
31-60 DAYS $ 900 $ 900
- ----------------------------------------------------------------------------------------------------------------
61-90 DAYS $ 0
- ----------------------------------------------------------------------------------------------------------------
91+ DAYS $ 1,062 $ 1,062
- ----------------------------------------------------------------------------------------------------------------
TOTAL $ 342,545 $ 1,062 $ 340,583 $ 900 $0 $0
================================================================================================================
</TABLE>
MOR-5 Revised 07/01/98
Page 5
<PAGE> 6
CASE NAME: Solo Serve Corporation
------------------------------
CASE NUMBER: 99-50272-K
---------------
<TABLE>
<CAPTION>
STATEMENT OF INCOME (LOSS)
=============================================================================================================================
MONTH MONTH MONTH MONTH MONTH MONTH FILING TO
Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99 DATE
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
REVENUES (MOR-1) 7,450,583 3,426,613 10,877,196
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL COST OF REVENUES 6,934,265 3,426,613 10,360,878
- -----------------------------------------------------------------------------------------------------------------------------
GROSS PROFIT 516,318 0 0 0 0 0 516,318
- -----------------------------------------------------------------------------------------------------------------------------
OPERATING EXPENSES:
- -----------------------------------------------------------------------------------------------------------------------------
Selling & Marketing 489,287 301,047 790,334
- -----------------------------------------------------------------------------------------------------------------------------
General & Administrative 416,092 (43,985) 372,107
- -----------------------------------------------------------------------------------------------------------------------------
Insiders Compensation 91,532 49,039 140,571
- -----------------------------------------------------------------------------------------------------------------------------
Professional Fees 40,000 7,500 47,500
- -----------------------------------------------------------------------------------------------------------------------------
Other 0
- -----------------------------------------------------------------------------------------------------------------------------
Other 0
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES 1,036,911 313,601 0 0 0 0 1,350,512
- -----------------------------------------------------------------------------------------------------------------------------
INCOME BEFORE INT, DEPR/TAX (MOR-1) (520,593) (313,601) 0 0 0 0 (834,194)
- -----------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE 53,149 (4,202) 48,947
- -----------------------------------------------------------------------------------------------------------------------------
DEPRECIATION 0
- -----------------------------------------------------------------------------------------------------------------------------
OTHER (INCOME) EXPENSE* (225,375) 451,696 226,321
- -----------------------------------------------------------------------------------------------------------------------------
OTHER ITEMS** 253,743 9,996 263,739
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL INT, DEPR & OTHER ITEMS 81,517 457,490 0 0 0 0 539,007
- -----------------------------------------------------------------------------------------------------------------------------
NET INCOME BEFORE TAXES (602,110) (771,091) 0 0 0 0 (1,373,201)
- -----------------------------------------------------------------------------------------------------------------------------
FEDERAL INCOME TAXES 0
- -----------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) (MOR-1) (602,110) (771,091) 0 0 0 0 (1,373,201)
=============================================================================================================================
</TABLE>
Accrual Accounting Required, Otherwise Footnote with Explanation.
* Footnote Mandatory.
** Unusual and/or infrequent item(s) outside the ordinary course of business
requires footnote.
MOR-6 Revised 07/01/98
Page 6
<PAGE> 7
MOR-6
<TABLE>
<CAPTION>
<S> <C> <C>
*Other Income
Gain on sale of fixtures and equipment 118,410 (455,675)
Miscellaneous income 578 0
Commission income 106,087 3,679
Rent income 300 300
-------------------------
225,375 (451,696)
=========================
**Other Items
Reorganization expense 253,743 9,996
-------------------------
253,743 9,996
=========================
</TABLE>
Page 7
<PAGE> 8
CASE NAME: Solo Serve Corporation
----------------------------
CASE NUMBER: 99-50272-K
--------------
<TABLE>
<CAPTION>
================================================================================================================================
CASH RECEIPTS AND MONTH MONTH MONTH MONTH MONTH MONTH FILING TO
DISBURSEMENTS Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99 DATE
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. CASH-BEGINNING OF MONTH 746,525 1,431,418 746,525
- --------------------------------------------------------------------------------------------------------------------------------
RECEIPTS:
- --------------------------------------------------------------------------------------------------------------------------------
2. CASH SALES 2,290,728 2,290,728
- --------------------------------------------------------------------------------------------------------------------------------
3. COLLECTION OF ACCOUNTS RECEIVABLE 1,346 1,346
- --------------------------------------------------------------------------------------------------------------------------------
4. LOANS & ADVANCES (attach list) 0
- --------------------------------------------------------------------------------------------------------------------------------
5. SALE OF ASSETS 112,000 661,499 773,499
- --------------------------------------------------------------------------------------------------------------------------------
6. OTHER (attach list) 5,552,292 1,454,328 7,006,620
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RECEIPTS** 7,955,020 2,117,173 0 0 0 0 10,072,193
- --------------------------------------------------------------------------------------------------------------------------------
(Withdrawal) Contribution by Individual
Debtor MFR-2*
- --------------------------------------------------------------------------------------------------------------------------------
DISBURSEMENTS:
- --------------------------------------------------------------------------------------------------------------------------------
7. NET PAYROLL 882,499 638,547 1,521,046
- --------------------------------------------------------------------------------------------------------------------------------
8. PAYROLL TAXES PAID 327,041 187,684 514,725
- --------------------------------------------------------------------------------------------------------------------------------
9. SALES, USE & OTHER TAXES PAID 227,921 495,348 723,269
- --------------------------------------------------------------------------------------------------------------------------------
10. SECURED/RENTAL/LEASES 681,834 460,595 1,142,429
- --------------------------------------------------------------------------------------------------------------------------------
11. UTILITIES 71,442 133,856 205,298
- --------------------------------------------------------------------------------------------------------------------------------
12. INSURANCE 103,886 6,315 110,201
- --------------------------------------------------------------------------------------------------------------------------------
13. INVENTORY PURCHASES 0 0
- --------------------------------------------------------------------------------------------------------------------------------
14. VEHICLE EXPENSES 413 134 547
- --------------------------------------------------------------------------------------------------------------------------------
15. TRAVEL & ENTERTAINMENT 2,415 4,933 7,348
- --------------------------------------------------------------------------------------------------------------------------------
16. REPAIRS, MAINTENANCE & SUPPLIES 5,107 15,810 20,917
- --------------------------------------------------------------------------------------------------------------------------------
17. ADMINISTRATIVE & SELLING 104,851 163,192 268,044
- --------------------------------------------------------------------------------------------------------------------------------
18. OTHER (attach list) 4,822,716 38,141 4,860,857
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS FROM OPERATIONS 7,230,126 2,144,555 0 0 0 0 9,374,682
- --------------------------------------------------------------------------------------------------------------------------------
19. PROFESSIONAL FEES 40,000 7,500 47,500
- --------------------------------------------------------------------------------------------------------------------------------
20. U.S. TRUSTEE FEES 0
- --------------------------------------------------------------------------------------------------------------------------------
21. OTHER REORGANIZATION EXPENSES
(attach list) 0
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS** 7,270,126 2,152,055 0 0 0 0 9,422,182
- --------------------------------------------------------------------------------------------------------------------------------
22. NET CASH FLOW 684,894 (34,882) 0 0 0 0 650,011
- --------------------------------------------------------------------------------------------------------------------------------
23. CASH - END OF MONTH (MOR-2) 1,431,418 1,396,536 0 0 0 0 1,396,536
================================================================================================================================
</TABLE>
Revised 07/01/98
* Applies to Individual debtors only
MOR-7 ** Numbers for the current month should balance (match)
RECEIPTS and CHECKS/OTHER DISBURSEMENTS lines on MOR-8
Page 8
<PAGE> 9
MOR-7
<TABLE>
<S> <C> <C> <C> <C> <C>
6. Other Receipts
COBRA payments from employees 874 4,163
Prepayment under agency agreement 5,194,742 0
Hilco expense and payroll reimbursements 356,676 1,392,094
Miscellaneous commission income 4,970
NSF repayments 2,828
Payment on note receivable 2,775
Refund of professional fees 47,498
----------------------------------------------------------------------
5,552,292 1,454,328 0 0 0
======================================================================
18. Other Disbursements
Payment on Note Payable Sanwa 4,585,000 0
Model Imperial Consignment Sales 55,033 0
Layaway refunds to customers 19,399 13,350
Interest and fees to Sanwa 136,460 0
Insurance loan payments 26,825 24,791
--------------------------
4,822,716 38,141
==========================
</TABLE>
Page 9
<PAGE> 10
CASE NAME: Solo Serve Corporation
-----------------------------------------
CASE NUMBER: 99-50272-K
-----------------
CASH ACCOUNT RECONCILIATION
MONTH OF March
------------------
<TABLE>
<CAPTION>
============================================================================================================================
BANK NAME Bank One, Texas Bank One, Texas Bank One, Texas
- ----------------------------------------------------------------------------------------------------------------------------
ACCOUNT NUMBER #1561353184 #156135168 #9320018766
- ----------------------------------------------------------------------------------------------------------------------------
ACCOUNT TYPE OPERATING PAYROLL EXPENSE DISBURS. OTHER FUNDS TOTAL
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BANK BALANCE $ 1,689,173 $ 0 $ 0 $ 86,063 $ 1,775,236
- ----------------------------------------------------------------------------------------------------------------------------
DEPOSITS IN TRANSIT $ 7,415 $ 5,749 $ 13,164
- ----------------------------------------------------------------------------------------------------------------------------
OUTSTANDING CHECKS $ 277,280 $ 114,584 $ 391,864
- ----------------------------------------------------------------------------------------------------------------------------
ADJUSTED BANK BALANCE $ 1,696,588 $ (277,280) $ (114,584) $ 91,812 $ 1,396,536
- ----------------------------------------------------------------------------------------------------------------------------
BEGINNING CASH - PER BOOKS $ 1,676,301 $ (252,540) $ (52,212) $ 59,869 $ 1,431,418
- ----------------------------------------------------------------------------------------------------------------------------
RECEIPTS* $ 2,117,173 $ 2,117,173
- ----------------------------------------------------------------------------------------------------------------------------
TRANSFERS BETWEEN ACCOUNTS $(1,659,135) $ 801,491 $ 793,584 $ 64,060 $ (0)
- ----------------------------------------------------------------------------------------------------------------------------
(WITHDRAWAL) CONTRIBUTION BY $ 0
INDIVIDUAL DEBTOR MFR-2
- ----------------------------------------------------------------------------------------------------------------------------
CHECKS/OTHER DISBURSEMENTS* $ 437,751 $ 826,231 $ 855,956 $ 32,117 $ 2,152,055
- ----------------------------------------------------------------------------------------------------------------------------
ENDING CASH - PER BOOKS $ 1,696,588 $ (277,280) $ (114,584) $ 91,812 $ 1,396,535
============================================================================================================================
</TABLE>
Revised 07/01/98
MOR-8 *Numbers should balance (match) TOTAL RECEIPTS and
TOTAL DISBURSEMENTS lines on MOR-7
Page 10
<PAGE> 11
CASE NAME: Solo Serve Corporation
---------------------------
CASE NUMBER: 99-50272-K
---------------
PAYMENTS TO INSIDERS AND PROFESSIONALS
Of the total disbursements shown for the month, list the amount paid to
insiders (as defined in Section 101(31)(A)-(F) of the U.S. Bankruptcy Code) and
the professionals. Also, for insiders, identify the type of compensation paid
(e.g., salary, commission, bonus, etc.) (Attach additional pages as necessary).
<TABLE>
<CAPTION>
=============================================================================================================================
MONTH MONTH MONTH MONTH MONTH MONTH
INSIDERS: NAME/COMP TYPE Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Charles Siegel Salary 41,903 31,754
- -----------------------------------------------------------------------------------------------------------------------------
2. Ross Bacon Salary 21,124 17,285
- -----------------------------------------------------------------------------------------------------------------------------
3. Mark Blankenship Salary 13,009 0
- -----------------------------------------------------------------------------------------------------------------------------
4. Terry Lalosh Salary 15,496 0
- -----------------------------------------------------------------------------------------------------------------------------
5.
- -----------------------------------------------------------------------------------------------------------------------------
6.
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL INSIDERS (MOR-1) 91,532 49,039 0 0 0 0
=============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
===================================================================================================================
MONTH MONTH MONTH MONTH MONTH MONTH
PROFESSIONALS Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. Kronish, Lieb et al 40,000
- -------------------------------------------------------------------------------------------------------------------
2. Keene Realty 7,500
- -------------------------------------------------------------------------------------------------------------------
3.
- -------------------------------------------------------------------------------------------------------------------
4.
- -------------------------------------------------------------------------------------------------------------------
5.
- -------------------------------------------------------------------------------------------------------------------
6.
- -------------------------------------------------------------------------------------------------------------------
TOTAL PROFESSIONALS (MOR-1) 40,000 7,500 0 0 0 0
===================================================================================================================
</TABLE>
Revised 07/01/98
MOR-9
Page 11
