<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): December 18, 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
November 20, 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 December 18, 1998.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Copy of the Registrant's Monthly Operating Report, for the period
ended November 20, 1998, filed with the Bankruptcy Court and U.S.
Trustee's Office on December 18, 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 23, 1998 By: Barry Bilmes
Title: Vice President Finance and Administration
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-1
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 NOVEMBER 20, 1998
<TABLE>
<CAPTION>
========================================================================================================================
<S> <C> <C> <C>
Document Previously Explanation
Required attachments Attached Submitted Attached
1. Tax Receipts ( ) ( ) ( X )
2. Bank Statements ( X ) ( ) ( )
3. Most recently filed ( ) ( X ) ( )
Income Tax Return
4. Most recent Annual 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 and
/s/ Barry Bilmes Administration
- ----------------------------------------- --------------------------
ORIGINAL SIGNATURE OF RESPONSIBLE PARTY TITLE
Barry Bilmes 12/18/98
- ----------------------------------------- --------------------------
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-2
COMPARATIVE BALANCE SHEET
<TABLE>
<CAPTION>
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 FOURTH QUARTER
- -----------------------------------------------------------------------------------------------------------
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-3
INCOME STATEMENT
<TABLE>
<CAPTION>
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 FOURTH QUARTER
- -----------------------------------------------------------------------------------------------------------
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-4
<TABLE>
<CAPTION>
BANK:
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974 ACCOUNT NO.:
ACCOUNT TYPE:
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)
- -----------------------------------------------------------------------------------------------------------
4. SALE OF ASSETS
- -----------------------------------------------------------------------------------------------------------
6. OTHER (ATTACH LIST)
- -----------------------------------------------------------------------------------------------------------
7. TOTAL RECEIPTS
- -----------------------------------------------------------------------------------------------------------
8. TOTAL CASH AVAILABLE
- -----------------------------------------------------------------------------------------------------------
CURRENT MONTH DISBURSEMENTS
- -----------------------------------------------------------------------------------------------------------
CHECK
NUMBER DATE PAYEE PURPOSE AMOUNT
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
TOTAL DISBURSEMENTS FROM BANK ACCOUNT
-----------------------------------------------------------------------------------------
END OF MONTH BALANCE (SHOULD EQUAL ACCRUAL BASIS-6, LINE 5)
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-5
<TABLE>
<CAPTION>
<S> <C> <C>
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
- -----------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE AGING - SEE EXHIBIT 4
- -----------------------------------------------------------------------------------------------------------
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>
<TABLE>
- -----------------------------------------------------------------------------------------------------------
AGING OF POST PETITION TAXES AND PAYABLES - SEE EXHIBIT 5
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
0-30 31-60 61-90 91+
DAYS DAYS DAYS DAYS TOTAL
- -----------------------------------------------------------------------------------------------------------
ACCOUNTS PAYABLE
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
STATUS OF POST PETITION TAXES - SEE EXHIBIT 6
- -----------------------------------------------------------------------------------------------------------
BEGINNING AMOUNT 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. AND AFFILIATED DEBTORS ACCRUAL BASIS-6
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.
<TABLE>
<CAPTION>
MONTH:
- ----------------------------------------------
BANK RECONCILIATION - SEE EXHIBIT 7
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
- -----------------------------------------------------------------------------------------------------------
- ----------------------------------------------
INVESTMENT ACCOUNTS
- -----------------------------------------------------------------------------------------------------------
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
- -----------------------------------------------------------------------------------------------------------
- ----------------------------------------------
CASH
- -----------------------------------------------------------------------------------------------------------
12. CURRENCY ON HAND
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
13. TOTAL CASH-END OF MONTH (Total of lines 5, 11, & 12)
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-7
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
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
PROFESSIONALS - SEE EXHIBIT 9
- -----------------------------------------------------------------------------------------------------------
TYPE DATE OF COURT
OF ORDER AUTHORIZING AMOUNT AMOUNT TOTAL PAID
NAME PROFESSIONAL PAYMENT APPROVED PAID TO DATE
- -----------------------------------------------------------------------------------------------------------
1.
- -----------------------------------------------------------------------------------------------------------
2.
- -----------------------------------------------------------------------------------------------------------
3.
- -----------------------------------------------------------------------------------------------------------
4.
- -----------------------------------------------------------------------------------------------------------
5.
- -----------------------------------------------------------------------------------------------------------
6. TOTAL PAYMENTS TO PROFESSIONALS
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
ADEQUATE PROTECTION PAYMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULED AMOUNTS
MONTHLY PAID TOTAL
PAYMENTS DURING UNPAID
NAME OF CREDITOR DUE MONTH POSTPETITION
- -----------------------------------------------------------------------------------------------------------
THE DEBTOR MADE NO ADEQUATE PROTECTION
PAYMENTS IN NOVEMBER 1998.
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-8
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------------------
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
- ---------------------------------------------------------------------------------------------------------------------------------
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
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
INSURANCE YES NO
- ---------------------------------------------------------------------------------------------------------------------------------
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.
- ---------------------------------------------------------------------------------------------------------------------------------
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.
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
INSURANCE POLICIES - SEE EXHIBIT 10
- ---------------------------------------------------------------------------------------------------------------------------------
TYPE OF PAYMENT AMOUNT
POLICY CARRIER PERIOD COVERED & FREQUENCY
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-9
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
<TABLE>
- ----------------------------------------------------------------------------------------------------------------
PERSONNEL
<S> <C>
- ----------------------------------------------------------------------------------------------------------------
FULL/PART TIME
- ----------------------------------------------------------------------------------------------------------------
1. Total number of employees at beginning of period 242
- ----------------------------------------------------------------------------------------------------------------
2. Number of employees hired during the period 2
- ----------------------------------------------------------------------------------------------------------------
3. Number of employees terminated or resigned during the period 20
- ----------------------------------------------------------------------------------------------------------------
4. Total number of employees on payroll at end of period 224
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
CHANGE OF ADDRESS
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
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 NOVEMBER 20, 1998
($000'S)
<TABLE>
<S> <C>
Current Assets:
Petty cash $ 2
Cash in bank 798
Accounts receivable 6,037
Inventories 5,378
Prepaid expenses and other assets 303
----------------
Current assets 12,518
Plant and Equipment, net 12,260
Other Assets:
Debt acquisition costs 1,313
Debt restructuring costs 147
Prepaid promotional expenses 2,847
Other assets 534
----------------
Total assets $ 29,619
================
Current Liabilities:
Accounts payable (post-petition) $ 553
Accrued expenses (post-petition) 3,568
Term loan note 15,493
Revolving loan 1,901
----------------
Current liabilities 21,515
Long Term Liabilities:
Long-term debt (pre-petition) 12,279
Liabilities Subject to Compromise:
Current maturities of long term debt and capital lease (pre-petition) 26
Accounts payable (pre-petition) 5,784
Accrued Expenses (pre-petition) 2,726
Accrued loss on future purchase commitments (pre-petition) 638
Allowance for operating losses of discontinued segment (pre-petition) 1,629
----------------
Liabilities subject to compromise 10,803
Minority interests 99
Shareholders' Equity:
Common stock 1
Additional paid-in capital 151,693
Accumulated deficit in earnings (166,321)
Treasury stock (450)
----------------
Total Shareholders Equity (15,077)
----------------
Total Liabilities and Shareholders Equity $ 29,619
================
</TABLE>
Exhibit 1
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
CONSOLIDATED INCOME STATEMENT - UNAUDITED
FOR THE MONTH ENDED NOVEMBER 20, 1998
($000'S)
<TABLE>
<CAPTION>
<S> <C>
Sales $ 4,384
Cost of goods sold 2,496
-------------
Gross profit 1,888
Operating expenses
Customer 844
Sales 179
Distribution 351
Marketing 86
General administrative 862
MIS administrative 90
-------------
Total operating expenses 2,412
Operating income (loss) (524)
Interest expense 166
Debt acquisition and restructuring costs 435
-------------
Net income (loss) $ (1,125)
</TABLE>
Exhibit 2
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
POST-PETITION CASH RECEIPTS AND DISBURSEMENTS
NOVEMBER 1998
($000'S)
<TABLE>
<CAPTION>
------------
10/24/98
11/20/98
------------
<S> <C>
RECEIPTS:
Lockbox $ 3,790
Credit Card 2
----------------
3,792
DISBURSEMENTS:
Green Coffee 1,493
Packaging & Flavoring 252
Payroll & Benefits 723
Plant Overhead 71
Customer Expenses 292
Distribution Costs 282
Sales Costs 58
Marketing 42
Management Info. Systems 16
Administrative 82
Professional Fees 364
Interest Expense & Bank Fees 2
Slotting Fees 175
Capital Expenditures 117
----------------
Total Disbursements 3,969
Net Cash Flow Prior to Goldman Activity (177)
Cash to Goldman (3,635)
Cash from Goldman 3,500
----------------
Net Cash Flow (312)
Beginning Cash 302
----------------
Ending Cash Before Float (10)
Outstanding Check Float 559
----------------
Cash Ledger Balance per Bank $ 549
================
GOLDMAN DIP:
Beginning Balance $ 2,036
Drawdowns 3,500
Paybacks (3,635)
----------------
Ending Balance $ 1,901
================
</TABLE>
Exhibit 3
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
AGING OF ACCOUNTS RECEIVABLE
AS OF NOVEMBER 20, 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>
$ 5,039 $ 1,135 $ 316 $ 283 $ 6,774 $ (737) $ 6,037
</TABLE>
Exhibit 4
<PAGE>
BROTHERS GOURMET COFFEES, INC AND AFFILIATED DEBTORS
AGING OF ACCOUNTS PAYABLE
AS OF NOVEMBER 20, 1998
($ 000'S)
<TABLE>
<CAPTION>
TOTAL
ACCOUNTS
0-30 DAYS (B) 31-60 DAYS 61-90 DAYS 91+ DAYS PAYABLE
------------- ---------- ---------- -------- -------
<S> <C> <C> <C> <C>
$ (245) $ (177) $ 118 $ (304) (a)
Outstanding Checks, Chase Account No. 312-7934031-66 790
Outstanding Checks, FUNB Account No. 2079900003505 67
---------------
Total Accounts Payable $ 553
===============
</TABLE>
Notes:
(a) Post-petition accounts payable debit balance results from prepayments for
inventory/materials not yet received.
(b) 0 - 30 Days balance reduced for unvouchered material receipts.
Exhibit 5
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
STATUS OF POST-PETITION TAXES
AS OF NOVEMBER 20, 1998
($000'S)
<TABLE>
<CAPTION>
AMOUNT
BEGINNING WITHHELD OR AMOUNT ENDING TAX DELINQUENT
TAX LIABILITY ACCRUED PAID LIABILILITY TAXES
<S> <C> <C> <C> <C> <C>
FEDERAL
Withholding (a) $ 72.0 $ 74.1 $ 72.0 $ 74.1 $ -
Unemployment (a) 0.2 0.1 0.2 0.1 -
----------------------------------------------------------------------------------
TOTAL FEDERAL 72.2 74.2 72.2 74.2 -
STATE
Withholding (a) 2.9 1.9 1.8 3.0 -
Unemployment (a) (0.3) 0.5 0.6 (0.4) -
Income 3.1 - - 3.1 -
Property 250.5 29.7 - 280.2 -
Sales 56.8 11.8 2.1 66.5 -
Franchise (b) 67.3 13.8 11.8 69.3 -
----------------------------------------------------------------------------------
TOTAL STATE AND LOCAL 380.3 57.7 16.3 421.7 -
----------------------------------------------------------------------------------
TOTAL TAXES $ 452.5 $ 131.9 $ 88.5 $ 495.9 $ -
==================================================================================
</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
BANK RECONCILIATION
AS OF NOVEMBER 20, 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 $ 20.2 $ 502.4 $ 185.8 $ 39.8 $ 34.4
- -----------------------------------------------------------------------------------------------------------------------------------
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 0.0 0.0 0.0
- -----------------------------------------------------------------------------------------------------------------------------------
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 (790.1) (67.4) (19.6)
- -----------------------------------------------------------------------------------------------------------------------------------
4. OTHER RECONCILING ITEMS (ATTACH LIST) 0.0 13.0 0.0 12.0 0.2
- -----------------------------------------------------------------------------------------------------------------------------------
5. MONTH END BALANCE PER BOOKS $ 20.2 $ 515.4 $ (604.4) $ (15.6) $ 15.0
- -----------------------------------------------------------------------------------------------------------------------------------
6. NUMBER OF LAST CHECK WRITTEN 94027 88744 8934
- -----------------------------------------------------------------------------------------------------------------------------------
ACCOUNT #6 ACCOUNT #7 ACCOUNT #8
- -----------------------------------------------------------------------------------------------------------------------------------
A. BANK: FUNB FUNB FUNB
B. ACCOUNT NUMBER: 2090000011463 2090000011450 2090000802410 TOTAL
C. PURPOSE (TYPE): DEPOSITORY DEPOSITORY CHECKING
- -----------------------------------------------------------------------------------------------------------------------------------
1. BALANCE PER BANK STATEMENT $ 5.3 $ 2.4 $ 3.9 $ 794.2
- -----------------------------------------------------------------------------------------------------------------------------------
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 2.3 2.3
- -----------------------------------------------------------------------------------------------------------------------------------
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 (1.2) (878.3)
- -----------------------------------------------------------------------------------------------------------------------------------
4. OTHER RECONCILING ITEMS (ATTACH LIST) 0.0 0.0 (3.2) 22.0
- -----------------------------------------------------------------------------------------------------------------------------------
5. MONTH END BALANCE PER BOOKS $ 5.3 $ 2.4 $ 1.8 $ (59.8)
- -----------------------------------------------------------------------------------------------------------------------------------
6. NUMBER OF LAST CHECK WRITTEN 1421
- -----------------------------------------------------------------------------------------------------------------------------------
Outstanding Checks, Chase 312-7934031-66 790.1
---------------------------------------------------------------------------------
Outstanding Checks, FUNB 2079900003505 67.4
---------------------------------------------------------------------------------
Month End Balance Per Books $ 797.7
---------------------------------------------------------------------------------
</TABLE>
Notes:
FUNB - First Union National Bank
Exhibit 7
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
DISTRIBUTIONS TO INSIDERS
NOVEMBER 1998
<TABLE>
<CAPTION>
Director's Other Total
Salary (a) Fees Bonus Severance Expense (b) Auto 401(K) Payments
---------- ---- ----- --------- ----------- ---- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
DIRECTORS:
Aburdene, Elias $ -- $ -- $- $ -- $ -- $ -- $ -- $ --
Bolduc, J.P -- -- - -- -- -- -- --
Moore, James -- 500 - -- -- -- -- 500
Rudy, Ray -- -- - -- -- -- -- --
OFFICERS:
Breen, Donald 19,403 -- - -- 464 -- 192 20,059
Bilmes, Barry 9,755 -- - -- -- -- 144 9,899
Pennington, Linda 8,151 -- - -- -- 400 -- 8,551
Davis, Eric 7,055 -- - -- 115 -- 87 7,257
Brownstein, Hyatt, Farber
& Strickland P.C -- -- - -- -- -- -- --
Schoonover, Randy 54 -- - -- -- -- -- 54
----------------------------------------------------------------------------------------------------
$44,418 $ 500 $- $ -- $ 579 $ 400 $ 423 $46,320
====================================================================================================
</TABLE>
Notes:
(a) Includes employer payments for medical, dental, basic life insurance
premiums, accidental death 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 (A)
NOVEMBER 1998
<TABLE>
<CAPTION>
NAME TOTAL
<S> <C>
Brownstein, Hyatt, Farber & Strickland, P.C. $ 36,297
Weil, Gotshal & Manges, LLP 75,306
Richards, Layton & Finger, P.A. 31,553
The Baynard Firm 16,979
M.R. Weiser & Co. LLP 33,357
White & Case, LLP 89,370
---------------
$ 282,862
===============
</TABLE>
NOTES:
(a) Payments for 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 November 20, 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
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
FOR THE MONTH ENDED NOVEMBER 20, 1998
ACCOUNT # 2
CHASE
DEPOSITORY
<TABLE>
<S> <C>
Beginning Balance $ 394,018
Lockbox Receipts 3,769,503
First Union Transfer -
Goldman Withdrawals (3,661,152)
---------------
Ending Balance $ 502,369
===============
</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.
