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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 8, 1999
MOBILEMEDIA COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-68840 22-3379712
(State or other (Commission File No.) (IRS Employer
jurisdication Identification No.)
of incorporation)
Fort Lee Executive Park, One Executive Drive, Suite 500,
Fort Lee, New Jersey 07024
(Address of principal executive offices)
(Zip Code)
(201) 224-9200
(Registrant's telephone number, including area code)
-------------------------
(Former name or former address, if changed since last report)
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<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 1. Changes in Control of Registrant.
Not Applicable.
Item 2. Acquisition or Disposition of Assets.
Not Applicable.
Item 3. Bankruptcy or Receivership.
Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant.
Not Applicable.
Item 5. Other Events.
On February 8, 1999, MobileMedia Corporation (the "Company"),
MobileMedia Communications, Inc. ("MobileMedia Communications") and all of the
subsidiaries of MobileMedia Communications (collectively, the "Companies") filed
with the United States Bankruptcy Court for the District of Delaware (the
"Bankruptcy Court") their monthly operating report for the month ended
December 31, 1998 which is attached hereto as Exhibit 99.1.
Item 6. Resignations of Registrant's Directors.
Not Applicable.
Item 7. Financial Statements and Exhibits.
Not Applicable.
Item 8. Change in Fiscal Year.
Not Applicable.
2
<PAGE>
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.
Date: February 9, 1999 MOBILEMEDIA COMMUNICATIONS, INC.
By: /s/ David R. Gibson
----------------------------
David R. Gibson
Senior Vice President and
Chief Financial Officer
3
<PAGE>
EXHIBIT INDEX
Exhibit Page
- ------- ----
Exhibit 99.1--Monthly Operating Report
4
OFFICE OF THE U.S. TRUSTEE - REGION 3
MONTHLY OPERATING REPORT
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
Document Previously Explanation
Required Attachments: Attached Submitted Attached
1. Tax Receipts ( ) (X) (X)
2. Bank Statements ( ) ( ) (X)
3. Most recently filed Income Tax Return ( ) ( ) (X)
4. Most recent Annual Financial Statements ( ) (X) ( )
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 AND THE ACCOMPANYING ATTACHMENTS AND, TO THE BEST OF MY KNOWLEDGE, THESE
DOCUMENTS ARE TRUE, CORRECT AND COMPLETE.
RESPONSIBLE PARTY:
Senior Vice President/Chief Financial Officer
- -------------------------------- ---------------------------------------------
SIGNATURE OF RESPONSIBLE PARTY TITLE
David R. Gibson February 8, 1999
- -------------------------------- ---------------------------------------------
PRINTED NAME OF RESPONSIBLE PARTY DATE
Page 1 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3
ATTACHMENT
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
1. Payroll tax filings and payments are made by Automated Data Processing,
Inc. (an outside payroll processing company). Evidence of tax payments are
available upon request. Previously, the Debtors filed copies of such
evidence for the third quarter of 1996 with the US Trustee.
Please see the Status of Post Petition Taxes attached hereto for the
month's activity.
2. The Debtors have 36 bank accounts. In order to minimize costs to the
estate, the Debtors have included a GAAP basis Statement of Cash Flows in
the Monthly Operating Report. The Statement of Cash Flows replaces the
listing of cash receipts and disbursements, copies of the bank statements,
and bank account reconciliations.
3. The Debtors have filed final federal and state income tax returns for the
years ended December 31, 1997 and 1996 and have made estimated income tax
payments for 1998 where applicable. Copies of these tax returns are
available upon request. Previously, the Debtors filed copies of such income
tax returns for the year ended December 31, 1995 with the US Trustee.
Page 2 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3
CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
See Statement of Operations for reporting period attached.
Page 3 of 17
<PAGE>
HEADNOTES:
These financial statements are unaudited and accordingly, there could be year
end audit adjustments as well as other adjustments related to the Debtors'
filing for protection under Chapter 11 of the US Bankruptcy Code on January 30,
1997.
(1) General & Administrative expense in December 1998 includes an adjustment of
approximately $1.2 million to reduce the Company's allowance for doubtful
accounts. This adjustment relates to periods prior to December 1998.
(2) On October 26, 1998 5 non-operating direct or indirect subsidiaries (the
"Proximity Entities") filed for protection under Chapter 11 of the US Bankruptcy
Code. Prior to the filing, the Proximity entities' principal creditors reached
an agreement whereby pre-petition claims in the aggregate would not be settled
for more than the discontinued operation's assets. As a result, the Company has
reversed $8.1 million of remaining amounts reserved for losses related to these
companies.
(3) In accordance with AICPA Statement of Position 90-7 "Financial Reporting by
Entities in Reorganization under the Bankruptcy Code", in December 1998 the
Company reduced various liabilities subject to compromise by approximately $10.5
million to reflect changes in estimated allowed claims.
(4) Income taxes result primarily from the gain on the sale of transmission
towers in September 1998.
MobileMedia Corporation and Subsidiaries
Consolidated Statements of Operations
For the Months Ended December 31, 1998, November 30, 1998 and October 31, 1998
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
December November October
1998 1998 1998
---------- ---------- ----------
<S> <C> <C> <C>
Paging Revenues
Service, Rents & Maintenance $33,826 $34,452 $34,778
Equipment Sales
Product Sales 1,865 2,017 2,374
Cost of Products Sold 1,364 2,065 2,203
---------- ---------- ----------
Equipment Margin 501 (48) 171
Net Revenue 34,328 34,404 34,949
Operating Expense
Service, Rents & Maintenance 9,210 9,337 9,537
Selling 5,020 5,053 5,185
General & Administrative 9,967 (1) 10,276 11,379
---------- ---------- ----------
Operating Expense Before Depr. & Amort. 24,197 24,666 26,101
EBITDA Before Reorganization and Restructuring Costs 10,131 9,738 8,848
Reorganization Costs 1,541 1,482 1,596
Restructuring Costs 0 0 175
---------- ---------- ----------
EBITDA after Reorganization and Restructuring Costs 8,590 8,256 7,078
Depreciation 6,872 6,852 6,981
Amortization 2,481 2,481 2,481
Amortization of Deferred Gain (389) (389) (389)
---------- ---------- ----------
Total Depreciation and Amortization 8,964 8,944 9,073
Operating Income(Loss) (374) (688) (1,995)
Interest Expense 3,496 3,436 3,661
Gain on Sale of Fixed Assets 0 0 0
Reversal of Estimated Loss on Discontinued Operations (8,120)(2) 0 0
Adjustment to Reduce Liabilities Subject to Compromise to Estimated Allowed Claims (10,461)(3) 0 0
Other (Income)Expense 202 (9) 65
Income Taxes 3,280 (4) 0 0
G & A / Operations ---------- ---------- ----------
Net Income(Loss) $11,229 ($4,115) ($5,722)
======= ======= =======
</TABLE>
See Accompanying Notes.
Page 4 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3 CONDENSED
CONSOLIDATED BALANCE SHEET
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
See balance sheet attached.
Page 5 of 17
<PAGE>
HEADNOTES:
These financial statements are unaudited and accordingly, there could be year
end audit adjustments as well as other adjustments related to the Debtors'
filing for protection under Chapter 11 of the US Bankruptcy Code on January 30,
1997.
(1) Accounts Receivable, Net in December 1998 includes an adjustment of $1.2
million to reduce the Company's allowance for doubtful accounts and an
adjustment to reclassify approximately $2.7 million in credit balances. These
adjustments relate to periods prior to December 1998.
(2) On October 26, 1998 5 non-operating direct or indirect subsidiaries (the
"Proximity Entities") filed for protection under Chapter 11 of the US Bankruptcy
Code. Prior to the filing, the Proximity entities' principal creditors reached
an agreement whereby pre-petition claims in the aggregate would not be settled
for more than the discontinued operation's assets. As a result, the Company has
reversed $8.1 million of remaining amounts reserved for losses related to these
companies.
(3) In accordance with AICPA Statement of Position 90-7 "Financial Reporting by
Entities in Reorganization under the Bankruptcy Code", in December 1998 the
Company reduced various liabilities subject to compromise by approximately $10.5
million to reflect changes in estimated allowed claims.
MobileMedia Corporation and Subsidiaries
Consolidated Balance Sheets
As of December 31, 1998, November 30, 1998 and October 31, 1998
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
December November October
1998 1998 1998
------------ ------------ ------------
<S> <C> <C> <C>
Assets:
Current Assets:
Cash $ 1,218 $ 4,016 $ 2,415
Accounts Receivable, Net 38,942(1) 34,995 37,548
Inventory 2,192 1,597 1,621
Prepaid Expenses 5,523 4,641 6,011
Other Current Assets 4,855 4,943 4,929
----------- ----------- -----------
Total Current Assets 52,731 50,192 52,524
Noncurrent Assets:
Property and Equipment, Net 219,642 217,645 218,313
Deferred Financing Fees, Net 19,295 19,599 19,902
Investment In Net Assets Of Equity Affiliate 1,400 1,612 1,691
Intangible Assets, Net 266,109 268,368 270,828
Other Assets 837 858 880
----------- ----------- -----------
Total Noncurrent Assets 507,283 508,082 511,614
Total Assets $ 560,013 $ 558,274 $ 564,138
=========== =========== ===========
Liabilities and Stockholders' Equity:
Liabilities Not Subject to Compromise:
DIP Credit Facility $ 0 $ 0 $ 0
Accrued Reorganization Costs 5,163 5,133 4,803
Accrued Wages, Benefits and Payroll Taxes 12,033 10,609 9,261
Accounts Payable - Post Petition 1,703 5,056 7,127
Accrued Interest 3,692 3,616 3,928
Accrued Expenses and Other Current Liabilities 37,402 29,123 28,373
Advance Billings and Customer Deposits 28,554 28,843 30,239
Deferred Gain on Tower Sale 68,444 68,833 69,222
----------- ----------- -----------
Total Liabilities Not Subject To Compromise 156,991 151,214 152,953
Liabilities Subject to Compromise:
Accrued Wages, Benefits and Payroll Taxes 647 3,085 3,086
Chase Credit Facility 479,000 479,000 479,000
Notes Payable - 10 1/2% 174,125 174,125 174,125
Notes Payable - 9 3/8% 250,000 250,000 250,000
Notes Payable - Yampol 986 986 986
Notes Payable - Dial Page 12 1/4% 1,570 1,570 1,570
Accrued Interest 17,579 20,423 20,423
Accounts Payable - Pre Petition 15,410 16,107 16,109
Accrued Expenses and Other Current Liabilities - Pre Petition 15,285 20,974 20,974
Other Liabilities 0 4,812 4,819
----------- ----------- -----------
Total Liabilities Subject To Compromise 954,602(1)(2)(3) 971,083 971,092
Deferred Tax Liability 3,869 2,655 2,655
Stockholders' Equity
Class A Common Stock 50 50 50
Class B Common Stock 2 2 2
Additional Paid-In Capital 689,148 689,148 689,148
Accumulated Deficit - Pre Petition (1,171,108) (1,171,108) (1,171,108)
Accumulated Deficit - Post Petition (67,419) (78,648) (74,532)
----------- ----------- -----------
Total Stockholders' Equity (549,326) (560,555) (556,439)
Less:
Treasury Stock (6,123) (6,123) (6,123)
----------- ----------- -----------
Total Stockholders' Equity (555,449) (566,678) (562,562)
Total Liabilities and Stockholders' Equity $ 560,013 $ 558,274 $ 564,138
=========== =========== ===========
</TABLE>
See Accompanying Notes
Page 6 of 17
<PAGE>
Footnotes to the Financial Statements:
1. These financial statements are unaudited and accordingly, there could be
year end audit adjustments as well as other adjustments related to the
Debtors' filing for protection under Chapter 11 of the US Bankruptcy Code
on January 30, 1997.
2. On January 30, 1997 (the "Filing Date"), MobileMedia Corporation (the
"Company"), MobileMedia Communications, Inc. ("MobileMedia Communications")
and all seventeen of MobileMedia Communications' subsidiaries (collectively
with the Company and MobileMedia Communications, the "Debtors"), filed for
protection under Chapter 11 of Title 11 of the United States Code (the
"Bankruptcy Code"). The Debtors are operating as debtors-in-possession and
are subject to the jurisdiction of the United States Bankruptcy Court for
the District of Delaware (the "Bankruptcy Court").
The Bankruptcy Court has authorized the Debtors to pay certain pre-petition
creditors. These permitted pre-petition payments include: (i) employee
salary and wages; (ii) certain employee benefits and travel expenses; (iii)
certain amounts owing to essential vendors; (iv) trust fund type sales and
use taxes; (v) trust fund payroll taxes; (vi) property taxes; (vii)
customer refunds; and (viii) customer rewards.
On August 20, 1998, Arch Communications Group, Inc. ("Arch") and the
Debtors announced a definitive merger agreement for Arch to acquire the
Debtors. This merger agreement was amended as of September 3, 1998 and as
of December 1, 1998. Under the terms of the agreement, Arch will acquire
the Debtors for a combination of cash, the assumption of certain
liabilities, and the issuance of Arch common stock and rights to acquire
Arch common stock. The transaction will be implemented through the Debtors'
Third Amended Joint Plan of Reorganization filed with the Bankruptcy Court
on December 2, 1998 ("the Amended Plan"). A Disclosure Statement related to
the Amended Plan was approved by the Bankruptcy Court on December 11, 1998
and a hearing on confirmation of the Amended Plan commenced on February 3,
1999 and is ongoing.
Page 7 of 17
<PAGE>
Footnotes to the Financial Statements (continued):
3. Since the Filing Date, the Debtors have continued to manage their business
as debtors-in-possession under sections 1107 and 1108 of the Bankruptcy
Code. During the pendency of the Chapter 11 cases, the Bankruptcy Court has
jurisdiction over the assets and affairs of the Debtors, and their
continued operations are subject to the Bankruptcy Court's protection and
supervision. The Debtors have sought, obtained, and are in the process of
applying for, various orders from the Bankruptcy Court intended to
stabilize and reorganize their business and minimize any disruption caused
by the Chapter 11 cases.
4. The Company is one of the largest paging companies in the U.S., with
approximately 3.1 million units in service at December 31, 1998, and offers
local, regional and national paging services to its subscribers. The
consolidated financial statements include the accounts of the Company and
its wholly-owned subsidiaries. The Company's business is conducted
primarily through the Company's principal operating subsidiary, MobileMedia
Communications, and its subsidiaries. The Company markets its services
primarily under the "MobileComm" brand name. All significant intercompany
accounts and transactions have been eliminated.
5. As previously announced in its September 27, 1996 and October 21, 1996
releases, misrepresentations and other violations had occurred during the
licensing process for as many as 400 to 500, or approximately 6% to 7%, of
the Company's approximately 8,000 local transmission one-way paging
stations. The Company caused an investigation to be conducted by its
outside counsel, and a comprehensive report regarding these matters was
provided to the FCC in the fall of 1996. In cooperation with the FCC,
outside counsel's investigation was expanded to examine all of the
Company's paging licenses, and the results of that investigation were
submitted to the FCC on November 8, 1996. As part of the cooperative
process, the Company also proposed to the FCC that a Consent Order be
entered which would result, among other things, in the return of certain
local paging authorizations then held by the Company, the dismissal of
certain pending applications for paging authorizations, and the voluntary
acceptance of a substantial monetary forfeiture.
On January 13, 1997, the FCC issued a Public Notice relating to the status
of certain FCC authorizations held by the Company. Pursuant to the Public
Notice, the FCC announced that it had (i) automatically terminated
approximately 185 authorizations for paging facilities that were not
constructed by the expiration date of their construction permits and
remained unconstructed, (ii) dismissed approximately 94 applications for
fill-in sites around existing paging stations (which had been filed under
the so-called "40-mile rule") as defective because they were predicated
upon unconstructed facilities and (iii) automatically terminated
approximately 99 other authorizations for paging facilities that were
constructed after the expiration date of their construction permits. With
respect to the approximately 99 authorizations where the underlying station
was untimely constructed, the FCC granted the Company interim operating
authority subject to further action by the FCC.
Page 8 of 17
<PAGE>
Footnotes to the Financial Statements (continued):
On April 8, 1997, the FCC adopted an order commencing an administrative
hearing into the qualification of the Company to remain a licensee. The
order directed an Administrative Law Judge to take evidence and develop a
full factual record on directed issues concerning the Company's filing of
false forms and applications. The Company was permitted to operate its
licensed facilities and provide service to the public during the pendency
of the hearing.
On June 6, 1997, the FCC issued an order staying the hearing proceeding in
order to allow the Company to develop and consummate a plan of
reorganization that provides for a change of control of the Company and a
permissible transfer of the Company's FCC licenses. The order was
originally granted for ten months and was extended by the FCC through
October 6, 1998. The order, which is based on an FCC doctrine known as
Second Thursday, provides that if there is a change of control that meets
the conditions of Second Thursday, the Company's FCC issues will be
resolved by the transfer of the Company's FCC licenses to the new owners of
the Company and the hearing will not proceed. The Company believes that a
reorganization plan that provides for either a conversion of certain
existing debt to equity, in which case existing MobileMedia shares will be
substantially diluted or eliminated, or a sale of the Company, as reflected
in the Amended Plan, will result in a change of control.
On September 2, 1998, the Company and Arch filed a joint Second Thursday
application. On October 5, 1998, a supplement was filed to notify the FCC
of certain modifications to the proposed transaction. The application was
accepted for filing by public notice dated October 15, 1998. On October 16,
1998, the Company and Arch filed a joint supplement of data requested by
the staff of the Wireless Telecommunications Bureau to assist in their
evaluation of the application. Public comments on the Second Thursday
application were due November 16, 1998. On that date, the FCC's Wireless
Telecommunications Bureau and the Pre-Petition Lenders filed comments
generally supporting grant of the application. MobileMedia, Arch and the
Pre-Petition Lenders each submitted timely reply comments. The designated
pleading cycle on the Second Thursday application is now closed.
On February 2, 1999 the FCC granted the Debtors' Second Thursday
application and approved the license transfers to Arch contemplated by the
Amended Plan. This approval is conditioned on confirmation of the Amended
Plan and consummation of the Amended Plan within nine months of
confirmation.
In the event that the Company were unable to consummate the Amended Plan or
any other plan of reorganization that satisfies the conditions of Second
Thursday, the Company would be required to proceed with the hearing, which,
if adversely determined, could result in the loss of the Company's licenses
or substantial monetary fines, or both. Such an outcome would have a
material adverse effect on the Company's financial condition and results of
operations.
Page 9 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3
CONSOLIDATED STATEMENT OF CASH
RECEIPTS AND DISBURSEMENTS
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
The Debtors have 36 bank accounts. In order to minimize costs to the estate, the
Debtors have included a GAAP basis Statement of Cash Flows for the reporting
period which is attached. The Statement of Cash Flows replaces the listing of
cash receipts and disbursements, copies of the bank statements, and bank account
reconciliations.
Page 10 of 17
<PAGE>
HEADNOTES:
These financial statements are unaudited and accordingly, there could be year
end audit adjustments as well as other adjustments related to the Debtors'
filing for protection under Chapter 11 of the US Bankruptcy Code on January 30,
1997.
(1) General & Administrative expense in December 1998 includes an adjustment of
approximately $1.2 million to reduce the Company's allowance for doubtful
accounts. This adjustment relates to periods prior to December 1998.
(2) On October 26, 1998 5 non-operating direct or indirect subsidiaries (the
"Proximity Entities") filed for protection under Chapter 11 of the US Bankruptcy
Code. Prior to the filing, the Proximity entities' principal creditors reached
an agreement whereby pre-petition claims in the aggregate would not be settled
for more than the discontinued operation's assets. As a result, the Company has
reversed $8.1 million of remaining amounts reserved for losses related to these
companies.
(3) In accordance with AICPA Statement of Position 90-7 "Financial Reporting by
Entities in Reorganization under the Bankruptcy Code", in December 1998 the
Company reduced various liabilities subject to compromise by approximately $10.5
million to reflect changes in estimated allowed claims.
(4) Income taxes result primarily from the gain on the sale of transmission
towers in September 1998.
MobileMedia Corporation and Subsidiaries
Consolidated Statements Of Cash Flows
For The Months Ended December 31, 1998, November 30, 1998 and October 31, 1998
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
December November October
1998 1998 1998
---------- --------- ---------
<S> <C> <C> <C> <C>
Operating Activities
Net Income(Loss) $ 11,229 ($ 4,115) ($ 5,722)
Adjustments To Reconcile Net Income(Loss) To Net Cash
Provided By (Used In) Operating Activities:
Depreciation And Amortization 9,353 9,333 9,462
Provision For Uncollectible Accounts And Returns (240)(1) 1,030 1,041
Amortization of Deferred Gain on Sale of Tower Assets (389) (389) (389)
State & Federal Income Taxes 3,280(4) 0 0
Write Down of Investment in Affiliate to Net Realizable Value 212 0 0
Recognized Gain On Sale Of Tower Assets 0 0 0
Reversal of Estimated Loss on Discontinued Operations (8,120)(2) 0 0
Adjustment to Reduce Liabilities Subject to Compromise to Estimated
Allowed Claims (10,461)(3) 0 0
Deferred Financings Fees, Net 304 304 304
Change In Operating Assets and Liabilities:
Accounts Receivable (3,707) 1,523 (461)
Inventory (595) 24 (454)
Prepaid Expenses And Other Assets (794) 1,436 850
Accounts Payable, Accrued Expenses and Other 6,000 (1,361) (5,609)
-------- -------- --------
Net Cash Provided By (Used In) Operating Activities 6,071 7,785 (978)
Investing Activities
Construction And Capital Expenditures,
Including Net Change In Pager Assets (8,869) (6,184) (6,420)
Net Proceeds From the Sale of tower assets 0 0 0
Other
-------- -------- --------
Net Cash Provided By (Used In) Investing Activities (8,869) (6,184) (6,420)
Financing Activities
Payment to Chase Credit Facility 0 0 0
Borrowings (Repayments) of DIP Credit Facility 0 0 0
-------- -------- --------
Net Cash Provided By (Used In) Financing Activities 0 0 0
Net Increase (Decrease) In Cash And Cash Equivalents (2,798) 1,601 (7,398)
Cash And Cash Equivalents At Beginning Of Period 4,016 2,415 9,814 $ 9,814
-------- -------- -------- ========
Cash And Cash Equivalents At End Of Period $ 1,218 $ 4,016 $ 2,415
======== ======== ========
</TABLE>
See Accompanying Notes
Page 11 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3
STATEMENT OF ACCOUNTS RECEIVABLE AGING AND
AGING OF POSTPETITION ACCOUNTS PAYABLE
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
================================================================================
ACCOUNTS RECEIVABLE AGING
- --------------------------------------------------------------------------------
$23,316,582 0 - 30 days old
----------------------------------------------------------------
14,337,535 31 - 60 days old
----------------------------------------------------------------
5,567,329 61 - 90 days old
----------------------------------------------------------------
10,331,700 91+ days old
----------------------------------------------------------------
53,553,146 TOTAL TRADE ACCOUNTS RECEIVABLE
----------------------------------------------------------------
(15,000,000) ALLOWANCE FOR UNCOLLECTIBLE ACCOUNTS
----------------------------------------------------------------
38,553,146 TRADE ACCOUNTS RECEIVABLE (NET)
----------------------------------------------------------------
389,220 OTHER NON-TRADE RECEIVABLES
----------------------------------------------------------------
$ 38,942,366 ACCOUNTS RECEIVABLE, NET
================================================================================
=========================================
AGING OF POSTPETITION ACCOUNTS PAYABLE
===============================================================================
0-30 31-60 61-90 91+
Days Days Days Days Total
- -------------------------------------------------------------------------------
ACCOUNTS PAYABLE $ 1,448,759 253,773 0 0 $1,702,532
- -------------------------------------------------------------------------------
Page 12 of 17
<PAGE>
OFFICE OF THE U.S. TRUSTEE - REGION 3
STATEMENT OF OPERATIONS, TAXES,
INSURANCE AND PERSONNEL
For the month ended December 31, 1998
Debtor Name: MobileMedia Corporation et al.
Case Number: 97-174 (PJW)
- --------------------------------------------------------------------------------
<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 $ 0 $1,270,408 $ 1,270,408 $ 0 $ 0
- -------------------------------------------------------------------------------------------
FICA-EMPLOYEE 0 853,797 853,797 0 0
- -------------------------------------------------------------------------------------------
FICA-EMPLOYER 28,044 1,262,950 1,173,514 117,480 0
- -------------------------------------------------------------------------------------------
UNEMPLOYMENT 276 6,244 5,434 1,086 0
- -------------------------------------------------------------------------------------------
INCOME 0 1,213,634 0 1,213,634 0
===========================================================================================
TOTAL FEDERAL TAXES 28,320 4,607,033 3,303,153 1,332,200 0
===========================================================================================
STATE AND LOCAL
===========================================================================================
WITHHOLDING 74,325 223,266 260,139 37,452 0
- -------------------------------------------------------------------------------------------
SALES 443,557 1,079,920 427,755 1,095,722 0
- -------------------------------------------------------------------------------------------
UNEMPLOYMENT 1,208 33,008 25,986 8,230 0
- -------------------------------------------------------------------------------------------
REAL PROPERTY 3,513,960 383,695 533,946 3,363,709 0
- -------------------------------------------------------------------------------------------
OTHER 3,913,227 2,441,529 2,199,507 4,155,249 0
===========================================================================================
TOTAL STATE AND LOCAL 7,946,277 4,161,418 3,447,333 8,660,362 0
===========================================================================================
TOTAL TAXES $ 7,974,597 $ 8,768,451 $ 6,750,486 $ 9,992,562 $ 0
===========================================================================================
</TABLE>
Page 13 of 17
<PAGE>
<TABLE>
<CAPTION>
==================================================================================================================
PAYMENTS TO INSIDERS AND PROFESSIONALS
For the month ended December 31, 1998
==================================================================================================================
==================================================================================================================
INSIDERS (1)
==================================================================================================================
Payee Name Position Salary/Bonus/ Reimbursable
Auto Allowance Expenses Total
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alvarez & Marsal Inc. - Chairman - Restructuring $ 54,167 $ 150 $ 54,317
Joseph A. Bondi
- ------------------------------------------------------------------------------------------------------------------
Burdette, H. Stephen Senior VP Corporate 15,000 5,772 20,772
Development and Senior VP
Operations
- ------------------------------------------------------------------------------------------------------------------
Grawert, Ron Chief Executive Officer 30,769 7,892 38,661
- ------------------------------------------------------------------------------------------------------------------
Gray, Patricia Secretary/VP and General 13,846 2,448 16,294
Counsel
- ------------------------------------------------------------------------------------------------------------------
Gross, Steven Executive VP Sales & 17,769 3,732 21,501
Marketing
- ------------------------------------------------------------------------------------------------------------------
Hilson, Debra Assistant Secretary 4,848 0 4,848
- ------------------------------------------------------------------------------------------------------------------
Pascucci, James Treasurer 8,400 1,305 9,705
- ------------------------------------------------------------------------------------------------------------------
Panzella, Vito VP / Controller 9,112 0 9,112
- ------------------------------------------------------------------------------------------------------------------
Witsaman, Mark Senior VP and Chief 15,269 1,784 17,053
Technology Officer
- ------------------------------------------------------------------------------------------------------------------
TOTAL PAYMENTS TO INSIDERS $ 192,263
=================================================================================================================
</TABLE>
(1) Excludes 19 non-executive officers of subsidiaries who were paid salaries
and reimbursable expenses in the aggregate of $210,122.
Page 14 of 17
<PAGE>
<TABLE>
<CAPTION>
======================================================================================================================
PAYMENTS TO INSIDERS AND PROFESSIONALS
(Continued) For the month ended December 31, 1998
======================================================================================================================
======================================================================================================================
PROFESSIONALS
======================================================================================================================
Holdback
and
Date of Invoice
Name and Relationship Court Invoices Invoices Balances
Approval Received (1) Paid Due
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Ernst & Young - Auditor, Tax and Financial 1/30/97 $ 321,139 $ - $ 780,593
Consultants to Debtor
- ----------------------------------------------------------------------------------------------------------------------
2. Latham & Watkins - Counsel to Debtor 1/30/97 100,129 71,309 271,871
- ----------------------------------------------------------------------------------------------------------------------
3. Alvarez & Marsal Inc.- Restructuring 1/30/97 154,608 133,606 315,945
Consultant to Debtor (2)
- ----------------------------------------------------------------------------------------------------------------------
4. Sidley & Austin - Bankruptcy Counsel to 1/30/97 460,290 551,024 798,356
Debtor
- ----------------------------------------------------------------------------------------------------------------------
5. Young, Conaway, Stargatt & Taylor - Delaware 1/30/97 29,309 58,829 35,324
Counsel to Debtor
- ----------------------------------------------------------------------------------------------------------------------
6. Wiley, Rein & Fielding - FCC Counsel to 1/30/97 153,388 249,496 108,604
Debtor
- ----------------------------------------------------------------------------------------------------------------------
7. Koteen & Naftalin - FCC Counsel to Debtor 6/11/97 - - 3,945
- ----------------------------------------------------------------------------------------------------------------------
8. Houlihan, Lokey, Howard & Zukin - Advisors 6/04/97 - - 226,550
to the Creditors' Committee
- ----------------------------------------------------------------------------------------------------------------------
9. Jones, Day, Reavis & Pogue - Counsel to the 4/03/97 53,866 134,925 171,630
Creditors' Committee
- ----------------------------------------------------------------------------------------------------------------------
10. Morris, Nichols, Arsht & Tunnell - Delaware 4/03/97 1,781 996 4,826
Counsel to the Creditors' Committee
- ----------------------------------------------------------------------------------------------------------------------
11. Paul, Weiss, Rifkind, Wharton & Garrison - 4/25/97 2,567 1,073 3,650
FCC Counsel to the Creditors' Committee
- ----------------------------------------------------------------------------------------------------------------------
12. The Blackstone Group LP - Financial Advisors 7/10/97 126,552 101,434 251,552
to Debtor
- ----------------------------------------------------------------------------------------------------------------------
13. Gerry, Friend & Sapronov, LLP. - Counsel to 10/27/97 17,698 83,573 44,969
Debtor
=================================================================-----------------------------------------------------
TOTAL $1,421,327 $1,386,265 $3,017,815
======================================================================================================================
</TABLE>
(1) Excludes invoices for fees and expenses through December 31, 1998 that were
received by the Debtors subsequent to December 31, 1998.
(2) Includes fees and expenses for David R. Gibson, Senior Vice President and
Chief Financial Officer (effective June 24, 1997).
Page 15 of 17
<PAGE>
<TABLE>
<CAPTION>
======================================================================================================================
ADEQUATE PROTECTION PAYMENTS
For the month ended December 31, 1998
======================================================================================================================
SCHEDULED AMOUNTS
MONTHLY PAID TOTAL
PAYMENTS DURING UNPAID
NAME OF CREDITOR DUE MONTH POSTPETITION
======================================================================================================================
<S> <C> <C> <C>
The Chase Manhattan Bank - (Interest) $3,228,161 $ 3,228,161* $ 0
======================================================================================================================
</TABLE>
* Payment made on 01/04/98.
<TABLE>
<CAPTION>
======================================================================================================================
QUESTIONNAIRE
For the month ended December 31, 1998 YES NO
======================================================================================================================
<S> <C> <C>
1. Have any assets been sold or transferred outside the normal course of
business this reporting period? No
- ----------------------------------------------------------------------------------------------------------------------
2. Have any funds been disbursed from any account other than a debtor in possession account? No
- ----------------------------------------------------------------------------------------------------------------------
3. Are any postpetition receivables (accounts, notes, or loans) due from related parties? No
- ----------------------------------------------------------------------------------------------------------------------
4. Have any payments been made of prepetition liabilities this reporting period? Yes
- ----------------------------------------------------------------------------------------------------------------------
5. Have any postpetition loans been received by the debtor from any party? No
- ----------------------------------------------------------------------------------------------------------------------
6. Are any postpetition payroll taxes past due? No
- ----------------------------------------------------------------------------------------------------------------------
7. Are any postpetition state or federal income taxes past due? No
- ----------------------------------------------------------------------------------------------------------------------
8. Are any postpetition real estate taxes past due? No
- ----------------------------------------------------------------------------------------------------------------------
9. Are any postpetition taxes past due? No
- ----------------------------------------------------------------------------------------------------------------------
10. Are any amounts owed to postpetition creditors past due? No
- ----------------------------------------------------------------------------------------------------------------------
11. Have any prepetition taxes been paid during the reporting period? Yes
- ----------------------------------------------------------------------------------------------------------------------
12. Are any wage payments past due? No
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
If the answer to any of the above questions is "YES", provide a detailed
explanation of each item.
Item 4 & 11. The Court has authorized the Debtors to pay certain
pre-petition creditors. These permitted pre-petition payments
include (i) employee salary and wages; (ii) certain employee
benefits and travel expenses; (iii) certain amounts owing to
essential vendors; (iv) trust fund type sales and use taxes;
(v) trust fund payroll taxes; (vi) property taxes; (vii)
customer refunds; and (viii) customer rewards.
Item 5. As of December 31, 1998 there were no funded borrowings under
the DIP facility.
Page 16 of 17
<PAGE>
<TABLE>
<CAPTION>
===========================================================================================
INSURANCE
For the month ended December 31, 1998
===========================================================================================
There were no changes in insurance coverage for the reporting period.
===========================================================================================
===========================================================================================
PERSONNEL
For the month ended December 31, 1998
- -------------------------------------------------------------------------------------------
Full Time Part Time
- -------------------------------------------------------------------------------------------
<S> <C> <C>
1. Total number of employees at beginning of period 2,984 19
- -------------------------------------------------------------------------------------------
2. Number of employees hired during the period 75 2
- -------------------------------------------------------------------------------------------
3. Number of employees terminated or resigned during the period 130 2
- -------------------------------------------------------------------------------------------
4. Total number of employees on payroll at end of period 2,929 19
- --------------------------------------------------------------------------- --------------
</TABLE>
Page 17 of 17
