<PAGE>
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 20, 1998
-----------------------
BROTHERS GOURMET COFFEES, INC.
-------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Delaware 0-23024 52-1681708
- -------------------------- ---------------- -------------------
(State or Other Juris- (Commission File (IRS Employer
diction of Incorporation) Number) Identification No.)
2255 Glades Road
Suite 100E
Boca Raton, Florida 33431
---------------------- -----------
(Address of Principal (Zip Code)
Executive Offices)
(561) 995-2600
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Not Applicable
-------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
ITEM 5. OTHER EVENTS
On October 15, 1998, the Registrant filed a request with the Securities and
Exchange Commission (the "Commission") seeking confirmation from the Staff
that it would not recommend any enforcement action to the Commission if, in
lieu of filing the quarterly and annual reports on Forms 10-Q and 10-K,
respectively, that the Registrant would otherwise be required to file while
it is in reorganization proceedings pursuant to Chapter 11 of the Bankruptcy
Code, the Registrant implements modified reporting procedures. Such modified
reporting procedures consist of filing each of the Registrant's Monthly
Operating Reports under cover of Form 8-K within 15 days after such Monthly
Operating Report is due to be filed with the Bankruptcy Court and U.S.
Trustee's Office. The Commission has not yet issued its decision on the
Registrant's request; however, pending such decision, the Registrant is
implementing the proposed modified reporting procedures. Accordingly, the
Registrant's Monthly Operating Report, presenting certain financial
information of the Registrant and its subsidiaries for the period ended
October 23, 1998, is attached hereto as Exhibit 99.1 and is incorporated
herein by reference. The attached Monthly Operating Report was filed with
the Bankruptcy Court and the U.S. Trustee's Office on November 20, 1998.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Copy of the Registrant's Monthly Operating Report, for the period
ended October 23, 1998, filed with the Bankruptcy Court and U.S.
Trustee's Office on November 20, 1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BROTHERS GOURMET COFFEES, INC.
(Registrant)
/s/ Barry Bilmes
-----------------------------------
Date: December 3, 1998 By: Barry Bilmes
Title: Vice President Finance and Administration
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND ACCRUAL BASIS-1
AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
OFFICE OF THE UNITED STATES TRUSTEE - REGION 3
MONTHLY OPERATING REPORT
FOR THE MONTH ENDING OCTOBER 23, 1998
<TABLE>
<CAPTION>
Document Previously Explanation
Required attachments Attached Submitted Attached
<S> <C> <C> <C>
1. Tax Receipts ( ) ( ) (X)
2. Bank Statements (X) ( ) ( )
3. Most recently filed ( ) (X) ( )
Income Tax Return
4. Most recent Annual Financial ( ) (X) ( )
Statements prepared by accountant
</TABLE>
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 THE PREPARER (OTHER THAN
RESPONSIBLE PARTY) IS BASED ON ALL INFORMATION OF WHICH PREPARER HAS ANY
KNOWLEDGE.
RESPONSIBLE PARTY:
Vice President Finance
/s/ Barry Bilmes and Administration
- ---------------------------------------- -----------------------
ORIGINAL SIGNATURE OF RESPONSIBLE PARTY TITLE
Barry Bilmes November 20, 1998
- ---------------------------------------- -----------------------
PRINTED NAME OF RESPONSIBLE PARTY DATE
PREPARER:
- ---------------------------------------- -----------------------
ORIGINAL SIGNATURE OF PREPARER TITLE
- ---------------------------------------- -----------------------
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.
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-2
AND AFFILIATED DEBTORS
COMPARATIVE BALANCE SHEET
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 THIRD QUARTER
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------
ASSETS - SEE EXHIBIT 1 MONTH MONTH MONTH
-------------------------------------------------
-------------------------------------------------
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
1. CASH
- ----------------------------------------------------------------------------------------------
2. ACCOUNTS RECEIVABLE
- ----------------------------------------------------------------------------------------------
3. INVENTORY
- ----------------------------------------------------------------------------------------------
4. NOTES RECEIVABLE
- ----------------------------------------------------------------------------------------------
5. PREPAID EXPENSES
- ----------------------------------------------------------------------------------------------
6. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
7. TOTAL CURRENT ASSETS
- ----------------------------------------------------------------------------------------------
8. PROPERTY, PLANT & EQUIPMENT
- ----------------------------------------------------------------------------------------------
9. LESS ACCUMULATED
DEPRECIATION/DEPLETION
- ----------------------------------------------------------------------------------------------
10. NET PROPERTY, PLANT & EQUIPMENT
- ----------------------------------------------------------------------------------------------
11. DUE FROM AFFILIATES & INSIDERS
- ----------------------------------------------------------------------------------------------
12. INTANGIBLES (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
13. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
14. TOTAL ASSETS
- ----------------------------------------------------------------------------------------------
POSTPETITION LIABILITIES
- ----------------------------------------------------------------------------------------------
15. ACCOUNTS PAYABLE
- ----------------------------------------------------------------------------------------------
16. TAXES PAYABLE
- ----------------------------------------------------------------------------------------------
17. NOTES PAYABLE
- ----------------------------------------------------------------------------------------------
18. PROFESSIONAL FEES
- ----------------------------------------------------------------------------------------------
19. SECURED DEBT
- ----------------------------------------------------------------------------------------------
20. DUE TO AFFILIATES & INSIDERS
- ----------------------------------------------------------------------------------------------
21. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
22. TOTAL POSTPETITION LIABILITIES
- ----------------------------------------------------------------------------------------------
PREPETITION LIABILITIES
- ----------------------------------------------------------------------------------------------
23. SECURED DEBT
- ----------------------------------------------------------------------------------------------
24. PRIORITY DEBT
- ----------------------------------------------------------------------------------------------
25. UNSECURED DEBT
- ----------------------------------------------------------------------------------------------
26. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
27. TOTAL PREPETITION LIABILITIES
- ----------------------------------------------------------------------------------------------
28. TOTAL LIABILITIES
- ----------------------------------------------------------------------------------------------
EQUITY
- ----------------------------------------------------------------------------------------------
29. PREPETITION OWNERS' EQUITY
- ----------------------------------------------------------------------------------------------
30. POSTPETITION CUMULATIVE
PROFIT OR (LOSS)
- ----------------------------------------------------------------------------------------------
31. TOTAL EQUITY (DEFECIT)
- ----------------------------------------------------------------------------------------------
32. TOTAL LIABILITIES &
OWNERS' EQUITY
- ----------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-3
AND AFFILIATED DEBTORS
INCOME STATEMENT
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 THIRD QUARTER
<TABLE>
<CAPTION>
REVENUES - SEE EXHIBIT 2 MONTH MONTH MONTH
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
1. GROSS REVENUES
- ----------------------------------------------------------------------------------------------
2. LESS: RETURNS & DISCOUNTS
- ----------------------------------------------------------------------------------------------
3. NET REVENUE
- ----------------------------------------------------------------------------------------------
COST OF GOODS SOLD
- ----------------------------------------------------------------------------------------------
4. BEGINNING INVENTORY
- ----------------------------------------------------------------------------------------------
5. ADD: PURCHASES
- ----------------------------------------------------------------------------------------------
6. LESS: ENDING INVENTORY
- ----------------------------------------------------------------------------------------------
7. TOTAL COST OF GOODS SOLD
- ----------------------------------------------------------------------------------------------
8. GROSS PROFIT
- ----------------------------------------------------------------------------------------------
OPERATING EXPENSES
- ----------------------------------------------------------------------------------------------
9. OFFICER/INSIDER COMPENSATION
- ----------------------------------------------------------------------------------------------
10. DIRECT LABOR/SALARIES
- ----------------------------------------------------------------------------------------------
11. PAYROLL TAXES
- ----------------------------------------------------------------------------------------------
12. RENT & LEASE EXPENSE
- ----------------------------------------------------------------------------------------------
13. INSURANCE
- ----------------------------------------------------------------------------------------------
14. DEPRECIATION/DEPLETION/AMORTIZATION
- ----------------------------------------------------------------------------------------------
15. GENERAL & ADMINISTRATIVE
- ----------------------------------------------------------------------------------------------
16. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
17. TOTAL OPERATING EXPENSE
- ----------------------------------------------------------------------------------------------
18. OPERATING INCOME
- ----------------------------------------------------------------------------------------------
OTHER INCOME & EXPENSES
- ----------------------------------------------------------------------------------------------
19. OTHER INCOME (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
20. OTHER EXPENSES (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
21. INTEREST EXPENSE
- ----------------------------------------------------------------------------------------------
22. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
23. NET OTHER INCOME & EXPENSES
- ----------------------------------------------------------------------------------------------
REORGANIZATION EXPENSES
- ----------------------------------------------------------------------------------------------
24. PROFESSIONAL FEES
- ----------------------------------------------------------------------------------------------
25. U.S. TRUSTEE FEES
- ----------------------------------------------------------------------------------------------
26. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
27. TOTAL REORGANIZATION EXPENSES
- ----------------------------------------------------------------------------------------------
28. INCOME TAX
- ----------------------------------------------------------------------------------------------
29. NET PROFIT (LOSS)
- ----------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-4
AND AFFILIATED DEBTORS
BANK:
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 ACCOUNT NO.:
ACCOUNT TYPE:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------
CASH RECEIPTS AND MONTH MONTH MONTH
DISBURSEMENTS - SEE EXHIBIT 3 -------------------------------------------------
-------------------------------------------------
<S> <C> <C> <C>
1. CASH-BEGINNING OF MONTH
- ----------------------------------------------------------------------------------------------
RECEIPTS
- ----------------------------------------------------------------------------------------------
2. CASH SALES
- ----------------------------------------------------------------------------------------------
3. COLLECTION OF ACCOUNTS RECEIVABLE
- ----------------------------------------------------------------------------------------------
4. LOANS & ADVANCES (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
5. SALE OF ASSETS
- ----------------------------------------------------------------------------------------------
6. OTHER (ATTACH LIST)
- ----------------------------------------------------------------------------------------------
7. TOTAL RECEIPTS
- ----------------------------------------------------------------------------------------------
8. TOTAL CASH AVAILABLE
- ----------------------------------------------------------------------------------------------
</TABLE>
CURRENT MONTH DISBURSEMENTS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------
CHECK
NUMBER DATE PAYEE PURPOSE AMOUNT
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS FROM BANK ACCOUNT
---------------------------------------------------------------------------------
END OF MONTH BALANCE (SHOULD EQUAL ACCRUAL BASIS-6, LINE 5)
- ----------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-5
AND AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
ACCOUNTS RECEIVABLE AGING - SEE EXHIBIT 4
<TABLE>
<CAPTION>
<S> <C>
- ------------------------------------------------------------
0 - 30 days old
- ------------------------------------------------------------
31 - 60 days old
- ------------------------------------------------------------
61 - 90 days old
- ------------------------------------------------------------
91+ days old
- ------------------------------------------------------------
TOTAL ACCOUNTS RECEIVABLE
- ------------------------------------------------------------
AMOUNTS CONSIDERED UNCOLLECTIBLE
- ------------------------------------------------------------
ACCOUNTS RECEIVABLE (NET)
- ------------------------------------------------------------
</TABLE>
AGING OF POST PETITION TAXES AND PAYABLES - SEE EXHIBIT 5
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
0-30 31-60 61-90 91+
DAYS DAYS DAYS DAYS TOTAL
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ACCOUNTS PAYABLE
- -------------------------------------------------------------------------------------------
</TABLE>
STATUS OF POST PETITION TAXES - SEE EXHIBIT 6
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
BEGINNING WITHHELD ENDING
TAX AND/ OR AMOUNT TAX DELINQUENT
LIABILITY* ACCRUED PAID LIABILITY* TAXES
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
FEDERAL
- ------------------------------------------------------------------------------------------------
WITHHOLDING**
- ------------------------------------------------------------------------------------------------
FICA-EMPLOYEE**
- ------------------------------------------------------------------------------------------------
FICA-EMPLOYER**
- ------------------------------------------------------------------------------------------------
UNEMPLOYMENT
- ------------------------------------------------------------------------------------------------
INCOME
- ------------------------------------------------------------------------------------------------
OTHER (ATTACH LIST)
- ------------------------------------------------------------------------------------------------
TOTAL FEDERAL TAXES
- ------------------------------------------------------------------------------------------------
STATE AND LOCAL
- ------------------------------------------------------------------------------------------------
WITHHOLDING
- ------------------------------------------------------------------------------------------------
SALES
- ------------------------------------------------------------------------------------------------
EXCISE
- ------------------------------------------------------------------------------------------------
UNEMPLOYMENT
- ------------------------------------------------------------------------------------------------
REAL PROPERTY
- ------------------------------------------------------------------------------------------------
PERSONAL PROPERTY
- ------------------------------------------------------------------------------------------------
OTHER (ATTACH LIST)
- ------------------------------------------------------------------------------------------------
TOTAL STATE AND LOCAL
- ------------------------------------------------------------------------------------------------
TOTAL TAXES
- ------------------------------------------------------------------------------------------------
</TABLE>
* 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 of deposit.
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-6
AND AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
THE DEBTOR IN POSSESSION MUST COMPLETE THE RECONCILIATION BELOW FOR EACH BANK
ACCOUNT, INCLUDING ALL GENERAL, PAYROLL AND TAX ACCOUNTS, AS WELL AS ALL
SAVINGS AND INVESTMENT ACCOUNTS, MONEY MARKET ACCOUNTS, CERTIFICATES OF
DEPOSIT, GOVERNMENT OBLIGATIONS, ETC. ACCOUNTS WITH RESTRICTED FUNDS SHOULD
BE IDENTIFIED BY PLACING AN ASTERISK NEXT TO THE ACCOUNT NUMBER. ATTACH
ADDITIONAL SHEETS IF NECESSARY.
MONTH:
BANK RECONCILIATION - SEE EXHIBIT 7
<TABLE>
<CAPTION>
ACCOUNT #1 ACCOUNT #2 ACCOUNT #3
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
A. BANK:
----------------------------------------
B. ACCOUNT NUMBER: TOTAL
----------------------------------------
C. PURPOSE (TYPE):
- ----------------------------------------------------------------------------------------------------
1. BALANCE PER BANK STATEMENT
- ----------------------------------------------------------------------------------------------------
2. ADD: TOTAL DEPOSITS NOT CREDITED
- ----------------------------------------------------------------------------------------------------
3. SUBTRACT: OUTSTANDING CHECKS
- ----------------------------------------------------------------------------------------------------
4. OTHER RECONCILING ITEMS (ATTACH LIST)
- ----------------------------------------------------------------------------------------------------
5. MONTH END BALANCE PER BOOKS
- ----------------------------------------------------------------------------------------------------
6. NUMBER OF LAST CHECK WRITTEN
- ----------------------------------------------------------------------------------------------------
</TABLE>
INVESTMENT ACCOUNTS
<TABLE>
<CAPTION>
DATE OF TYPE OF PURCHASE CURRENT
BANK ACCOUNT NAME & NUMBER PURCHASE INSTRUMENT PRICE VALUE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
7.
- ----------------------------------------------------------------------------------------------------
8.
- ----------------------------------------------------------------------------------------------------
9.
- ----------------------------------------------------------------------------------------------------
10.
- ----------------------------------------------------------------------------------------------------
11. TOTAL INVESTMENTS
- ----------------------------------------------------------------------------------------------------
</TABLE>
CASH
<TABLE>
<S> <C>
12. CURRENCY ON HAND
- ----------------------------------------------------------------------------------------------------
13. TOTAL CASH-END OF MONTH (Total of lines 5, 11, & 12)
- ----------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-7
AND AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
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 TO PROFESSIONALS. ALSO, FOR PAYMENTS TO INSIDERS, IDENTIFY THE TYPE OF
COMPENSATION PAID (e.g. SALARY, BONUS, COMMISSIONS, INSURANCE, HOUSING
ALLOWANCE TRAVEL, CAR ALLOWANCE, ETC.). ATTACH ADDITIONAL SHEETS IF
NECESSARY.
<TABLE>
<CAPTION>
INSIDERS - SEE EXHIBIT 8
- --------------------------------------------------------------------------------- CUMULATIVE
TYPE OF AMOUNT UNPAID
NAME POSITION PAYMENT PAID BALANCE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1.
- ----------------------------------------------------------------------------------------------------
2.
- ----------------------------------------------------------------------------------------------------
3.
- ----------------------------------------------------------------------------------------------------
4.
- ----------------------------------------------------------------------------------------------------
5.
- ----------------------------------------------------------------------------------------------------
6. TOTAL PAYMENTS TO INSIDERS
- ----------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
TYPE DATE OF COURT
OF ORDER AUTHORIZING AMOUNT AMOUNT TOTAL PAID
NAME PROFESSIONAL PAYMENT APPROVED PAID TO DATE
<S> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
1.
- -------------------------------------------------------------------------------------------------------
2.
- -------------------------------------------------------------------------------------------------------
3.
- -------------------------------------------------------------------------------------------------------
4.
- -------------------------------------------------------------------------------------------------------
5.
- -------------------------------------------------------------------------------------------------------
6. TOTAL PAYMENTS TO PROFESSIONALS
- -------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ADEQUATE PROTECTION PAYMENTS
- -------------------------------------------------------------------------------------------------------
SCHEDULED AMOUNTS
MONTHLY PAID TOTAL
PAYMENTS DURING UNPAID
NAME OF CREDITOR DUE MONTH POSTPETITION
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
THE DEBTOR MADE NO ADEQUATE PROTECTION
PAYMENTS IN OCTOBER 1998.
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-8
AND AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
QUESTIONNAIRE
YES NO
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. HAVE ANY ASSETS BEEN SOLD OR TRANSFERRED OUTSIDE THE NORMAL COURSE OF BUSINESS
THIS REPORTING PERIOD? X
- --------------------------------------------------------------------------------------------------------------
2. HAVE ANY FUNDS BEEN DISBURSED FROM ANY ACCOUNT OTHER THAN A DEBTOR IN POSSESSION
ACCOUNT? X
- --------------------------------------------------------------------------------------------------------------
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(a)
- --------------------------------------------------------------------------------------------------------------
5. HAVE ANY POSTPETITION LOANS BEEN RECEIVED BY THE DEBTOR FROM ANY PARTY? X(b)
- --------------------------------------------------------------------------------------------------------------
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 DELINQUENT? X
- --------------------------------------------------------------------------------------------------------------
11. HAVE ANY PREPETITION TAXES BEEN PAID DURING THE REPORTING PERIOD? X(c)
- --------------------------------------------------------------------------------------------------------------
12. ARE ANY WAGE PAYMENTS PAST DUE? X
- --------------------------------------------------------------------------------------------------------------
</TABLE>
IF THE ANSWER TO ANY OF THE ABOVE QUESTIONS IS "YES," PROVIDE A DETAILED
EXPLANATION OF EACH ITEM. ATTACH ADDITIONAL SHEETS IF NECESSARY.
(a) The Debtors are authorized to pay certain pre-petition liabilities under
"First Day" Orders. Only pre-petition payments so authorized have been made
and reported in accordance with such orders.
(b) Loans received in accordance with Debtor-In-Possession Financing
Agreement. Approved by the Court.
(c) Various de minimus pre-petition business license and franchise fees paid.
Such license and franchise fees were necessary to continue to conduct
business in certain jurisdictions
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
INSURANCE YES NO
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. ARE WORKERS 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 CANCELLED OR NOT RENEWED DURING THIS REPORTING PERIOD, PROVIDE AN
EXPLANATION BELOW. ATTACH ADDITIONAL SHEETS IF NECESSARY.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
INSURANCE POLICIES - SEE EXHIBIT 10
- --------------------------------------------------------------------------------------------------------
TYPE OF PAYMENT AMOUNT
POLICY CARRIER PERIOD COVERED & FREQUENCY
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. ACCRUAL BASIS-9
AND AFFILIATED DEBTORS
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
PERSONNEL
<TABLE>
<CAPTION>
FULL/PART TIME
<S> <C>
- -------------------------------------------------------------------------------------
1. Total number of employees at beginning of period 242
- -------------------------------------------------------------------------------------
2. Number of employees hired during the period 6
- -------------------------------------------------------------------------------------
3. Number of employees terminated or resigned during the period 6
- -------------------------------------------------------------------------------------
4. Total number of employees on payroll at end of period 242
- -------------------------------------------------------------------------------------
</TABLE>
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:
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
CONSOLIDATED BALANCE SHEET - UNAUDITED
AS OF OCTOBER 23, 1998
($000'S)
<TABLE>
<S> <C>
Current Assets:
Petty cash $ 2
Cash in bank 335
Accounts receivable 5,712
Inventories 5,929
Prepaid expenses and other assets 322
---------
Current assets 12,300
Plant and Equipment, net 12,508
Other Assets:
Debt acquisition costs 1,531
Debt restructuring costs 293
Prepaid promotional expenses 2,960
Other assets 566
---------
Total assets $ 30,158
---------
---------
Current Liabilities:
Term loan note $ 15,493
Revolving loan 2,036
Current maturities of long term debt and capital lease 30
Accounts payable (pre-petition) 5,903
Accounts payable (post-petition) (493)(a)
Accrued expenses 6,517
Accrued loss on future purchase commitments 638
Allowance for operating losses of discontinued segment 1,648
Accrued restructuring expenses --
---------
Current liabilities 31,772
Long Term Liabilities:
Long-term debt (pre-petition) 12,239
Minority interests 99
Shareholders' Equity:
Common stock 1
Additional paid-in capital 151,693
Accumulated deficit in earnings (165,196)
Treasury stock (450)
---------
Total Shareholders Equity (13,952)
---------
Total Liabilities and Shareholders Equity $ 30,158
---------
---------
</TABLE>
NOTES:
(a) Post-petition accounts payable debit balance results from prepayments for
inventory/materials not yet received.
Exhibit 1
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
CONSOLIDATED INCOME STATEMENT - UNAUDITED
FOR THE MONTH ENDED OCTOBER 23, 1998
($000'S)
<TABLE>
<S> <C>
Sales $ 4,587
Cost of goods sold 2,666
-------
Gross profit 1,921
Operating expenses
Customer 781
Sales 136
Distribution 335
Marketing 97
General administrative 837
MIS administrative 84
-------
-------
Total operating expenses 2,270
Operating income (loss) (349)
Interest expense 175
Debt restructuring costs 435
Other (income) expense 2
-------
-------
Net income (loss) before reorganization expenses (961)
Reorganization expenses --
-------
Net income (loss) $ (961)
-------
-------
</TABLE>
Exhibit 2
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
AGING OF ACCOUNTS RECEIVABLE
AS OF OCTOBER 23, 1998
($000'S)
<TABLE>
<CAPTION>
Past Due
----------------------------------------- Total Accounts Allowance for Returns Net Accounts
0 - 30 Days 30 - 60 Days 60 - 90 Days Over 90 Receivable and Bad Debts Receivable
- ----------- ------------ ------------ ------- --------------- --------------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ 4,512 $ 1,428 $ 44 $ 628 $ 6,612 $ (900) $ 5,712
</TABLE>
Exhibit 4
<PAGE>
BROTHERS GOURMET COFFEES, INC AND AFFILIATED DEBTORS
AGING OF ACCOUNTS PAYABLE
AS OF OCTOBER 23, 1998
($ 000'S)
<TABLE>
<CAPTION>
TOTAL
ACCOUNTS
0-30 DAYS 31-60 DAYS 61-90 DAYS 91+ DAYS PAYABLE
- --------- ---------- ---------- -------- ----------
<S> <C> <C> <C> <C>
$ (547) $ 54 $ -- $ -- $ (493)(a)
</TABLE>
NOTES:
(a) Post-petition accounts payable debit balance results from prepayments for
inventory/materials not yet received.
Exhibit 5
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
STATUS OF POST-PETITION TAXES
AS OF OCTOBER 23, 1998
($000'S)
<TABLE>
<CAPTION>
AMOUNT
BEGINNING WITHHELD OR AMOUNT ENDING TAX DELINQUENT
TAX LIABILITY ACCRUED PAID LIABILITY TAXES
<S> <C> <C> <C> <C> <C>
FEDERAL
Withholding (a) $ 76.5 $ 72.0 $ 76.5 $ 72.0 $ --
Unemployment (a) 0.2 0.2 0.2 0.2 --
------ ------ ------ ------ ------
TOTAL FEDERAL 76.7 72.2 76.7 72.2 --
STATE
Withholding (a) 3.0 1.8 1.9 2.9 --
Unemployment (a) (0.2) 0.5 0.6 (0.3) --
Income 3.1 -- -- 3.1 --
Property 221.0 29.7 0.2 250.5 --
Sales 56.2 10.4 9.8 56.8 --
Franchise (b) 53.2 14.5 0.4 67.3 --
------ ------ ------ ------ ------
TOTAL STATE AND LOCAL 336.3 56.9 12.9 380.3 --
------ ------ ------ ------ ------
TOTAL TAXES $413.0 $129.1 $ 89.6 $452.5 $ --
------ ------ ------ ------ ------
------ ------ ------ ------ ------
</TABLE>
NOTES:
(a) The Debtors are authorized to pay certain pre-petition employee related
taxes under "First Day" orders.
(b) Various de minimus pre-petition business license and franchise fees paid.
Such license and franchise fees were necessary to continue to conduct
business in certain jurisdictions.
Exhibit 6
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
FOR THE MONTH ENDED OCTOBER 23, 1998
ACCOUNT # 2
CHASE
DEPOSITORY
<TABLE>
<S> <C>
Beginning Balance $ --
Lockbox Receipts 1,014,012
First Union Transfer 1,024,037
Goldman Withdrawals (1,644,031)
-----------
Ending Balance $ 394,018
-----------
-----------
</TABLE>
NOTES:
Pursuant to the terms of the DIP financing agreement, this depository account
is in the name of Goldman Sachs Credit Partners, L.P. Consequently, Brothers
Gourmet Coffees, Inc. does not receive formal bank statements.
The Debtor receives daily lock box deposit amounts from Chase and daily
withdrawal amounts from Goldman Sachs Credit Partners, L.P.
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
BANK RECONCILIATION
AS OF OCTOBER 23, 1998
($000'S)
<TABLE>
<CAPTION>
ACCOUNT #1 ACCOUNT #2 ACCOUNT # 3 ACCOUNT #4 ACCOUNT #5
<S> <C> <C> <C> <C> <C>
A. BANK: FUNB CHASE CHASE FUNB FUNB
B. ACCOUNT NUMBER: 2000000482626 312-7934031-66 2079900003505 2155300194336
C. PURPOSE (TYPE): DEPOSITORY DEPOSITORY CHECKING CHECKING PAYROLL
1. BALANCE PER BANK STATEMENT $ 0.1 $ 394.0 $ 248.3 $ 79.8 $ 38.4
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 0.0 0.0 0.0
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 (220.9) (176.5) (8.1)
4. OTHER RECONCILING ITEMS (ATTACH LIST) (35.8) 3.3 0.0 0.0 0.2
5. MONTH END BALANCE PER BOOKS $ (35.7) $ 397.3 $ 27.4 $ (96.7) $ 30.5
6. NUMBER OF LAST CHECK WRITTEN 93242 88744 8758
</TABLE>
<TABLE>
<CAPTION>
ACCOUNT #6 ACCOUNT #7 ACCOUNT #8
<S> <C> <C> <C> <C>
A. BANK: FUNB FUNB FUNB
B. ACCOUNT NUMBER: 2090000011463 2090000011450 2090000802410 TOTAL
C. PURPOSE (TYPE): DEPOSITORY DEPOSITORY CHECKING
1. BALANCE PER BANK STATEMENT $ 5.7 $ 4.7 $ 2.3 $ 773.3
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 2.0 2.0
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 (1.8) (407.3)
4. OTHER RECONCILING ITEMS (ATTACH LIST) 0.0 0.0 0.0 (32.3)
5. MONTH END BALANCE PER BOOKS $ 5.7 $ 4.7 $ 2.4 $ 335.7
6. NUMBER OF LAST CHECK WRITTEN 1407
</TABLE>
NOTES:
FUNB - First Union National Bank
Exhibit 7
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
DISTRIBUTIONS TO INSIDERS
OCTOBER 1998
<TABLE>
<CAPTION>
Other Total
Salary (a) Bonus Severance Expense (b) Auto 401(K) Payments
---------- ------ --------- ----------- ----- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
DIRECTORS:
Aburdene, Elias $ -- $ -- $ -- $ -- $ -- $ -- $ --
Bolduc, J.P -- -- -- -- -- -- --
Moore, James -- -- -- -- -- -- --
Rudy, Ray -- -- -- -- -- -- --
OFFICERS:
Breen, Donald 19,403 -- -- 1,739 612 192 21,946
Bilmes, Barry 9,755 -- -- 197 -- 144 10,096
Pennington, Linda 8,151 -- -- 425 413 -- 8,989
Davis, Eric 7,055 -- -- -- -- 87 7,142
Brownstein, Hyatt, Farber
& Strickland P.C -- -- -- -- -- -- --
Schoonover, Randy 54 -- -- -- -- 277 331
-------- ------ ------- ------- ------- ----- --------
$ 44,418 $ -- $ -- $ 2,361 $ 1,025 $ 700 $ 48,504
-------- ------ ------- ------- ------- ----- --------
-------- ------ ------- ------- ------- ----- --------
</TABLE>
NOTES:
(a) Includes employer payments for medical, dental, basic life insurance
premiums, accidental dealth and dismemberment and basic long-term
disability.
(b) Meals, travel expenses, etc.
Exhibit 8
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
PAYMENTS TO PROFESSIONALS
OCTOBER 1998
<TABLE>
<CAPTION>
NAME TOTAL
<S> <C>
Brownstein, Hyatt, Farber & Strickland, P.C. $ 10,306 (a)
PricewaterhouseCoopers, LLP 25,755 (a)
Weil, Gotshal & Manges, LLP 17,960 (a)
Richards, Layton & Finger, P.A. 18,610 (a)
--------
$ 72,630
--------
--------
</TABLE>
NOTES:
(a) Payments for August 1998 post-petition fees and expenses in accordance with
the Interim Compensation Order.
Exhibit 9
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
INSURANCE POLICIES
AS OF OCTOBER 23, 1998
<TABLE>
<CAPTION>
TYPE OF POLICY TERM CARRIER PAYMENTS FREQUENCY
<S> <C> <C> <C> <C>
Package 7/1/98-6/30/99 Royal & Sun Alliance $ 158,445 Monthly
TX Auto 7/1/98-6/30/99 Royal & Sun Alliance $ 19,166 Monthly
Foreign Liability 7/1/98-6/30/99 Royal & Sun Alliance $ 2,500 Monthly
Workers' Compensation 7/1/98-6/30/99 Royal & Sun Alliance $ 199,875 Monthly
CA Worker's Compensation 7/1/98-6/30/99 Royal & Sun Alliance $ 24,673 Monthly
Umbrella - $10 million 7/1/98-6/30/99 Royal & Sun Alliance $ 20,042 Monthly
Umbrella - $15 million 7/1/98-6/30/99 Royal & Sun Alliance $ 15,500 Annually
Directors and Offficers 2/25/98-2/25/99 National Union $ 120,000 Annually
</TABLE>
Exhibit 10
