<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 19, 1999
-------------------
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.)
7105 Katy Road
Houston, Texas 77024
- -------------------------------------------------------------------------------
(Address of Principal (Zip Code)
Executive Offices)
(713) 868-8294
- -------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
- -------------------------------------------------------------------------------
(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 31, 1999, 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 19, 1999.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Copy of the Registrant's Monthly Operating Report, for the
period ended October 31, 1999, filed with the Bankruptcy Court
and U.S. Trustee's Office on November 19, 1999.
<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: November 30, 1999 By: Barry Bilmes
Title: President
<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 OCTOBER , 1999
<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:
/s/ Larry Smith Controller
- ---------------------------------------------- ------------------------
ORIGINAL SIGNATURE OF RESPONSIBLE PARTY TITLE
Larry Smith 11/19/99
- ---------------------------------------------- ------------------------
PRINTED NAME OF RESPONSIBLE PARTY DATE
PREPARER:
/s/ Clifton Franklin Acctg Mgr.
- ---------------------------------------------- ------------------------
ORIGINAL SIGNATURE OF PREPARER TITLE
Clifton Franklin 11/19/99
- ---------------------------------------------- ------------------------
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
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-3
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-4
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)
- ----------------------------------------------------------------------------------------------------------------------------
4. SALE OF ASSETS
- ----------------------------------------------------------------------------------------------------------------------------
6. OTHER (ATTACH LIST)
============================================================================================================================
7. TOTAL RECEIPTS
============================================================================================================================
8. TOTAL CASH AVAILABLE
============================================================================================================================
CURRENT MONTH DISBURSEMENTS
- ----------------------------------------------------------------------------------------------------------------------------
<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. AND AFFILIATED DEBTORS ACCRUAL BASIS-5
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
ACCOUNTS RECEIVABLE AGING - SEE EXHIBIT 4
- ------------------------------------------------------------------------------------------------------------------------------
<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>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
AGING OF POST PETITION TAXES AND PAYABLES - SEE EXHIBIT 5
- ------------------------------------------------------------------------------------------------------------------------------
0-30 31-60 61-90 91+
DAYS DAYS DAYS DAYS TOTAL
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ACCOUNTS PAYABLE
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
STATUS OF POST PETITION TAXES - SEE EXHIBIT 6
- ------------------------------------------------------------------------------------------------------------------------------
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. 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> <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>
<TABLE>
<CAPTION>
--------------------------------------------------------------------
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
==============================================================================================================================
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
PROFESSIONALS - SEE EXHIBIT 9
- ------------------------------------------------------------------------------------------------------------------------------
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
==============================================================================================================================
- ------------------------------------------------------------------------------------------------------------------------------
<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 August, 1999.
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DEBTOR: BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS ACCRUAL BASIS-8
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
- -----------------------------------------------------------------------------------------------------------------------------
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.
- -----------------------------------------------------------------------------------------------------------------------------
</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>
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
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. AND AFFILIATED DEBTORS ACCRUAL BASIS-9
CASE NO.: 98-1970, 98-1971, 98-1973, 98-1974
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
PERSONNEL
- ------------------------------------------------------------------------------------------------------------------------------
FULL/PART TIME
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Total number of employees at beginning of period 69
- ------------------------------------------------------------------------------------------------------------------------------
2. Number of employees hired during the period 3
- ------------------------------------------------------------------------------------------------------------------------------
3. Number of employees terminated or resigned during the period 0
- ------------------------------------------------------------------------------------------------------------------------------
4. Total number of employees on payroll at end of period 72
==============================================================================================================================
</TABLE>
- -----------------------------------------------------------------------------
CHANGE OF ADDRESS
1705 KATY ROAD
HOUSTON, TEXAS 77024
713-868-8100
- -----------------------------------------------------------------------------
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:__September 30, 1999________________________
NEW ADDRESS:
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
CONSOLIDATED INCOME STATEMENT - UNAUDITED
AS OF OCTOBER 31, 1999
($000's)
<TABLE>
<S> <C>
Current Assets:
Petty cash $ 1
Cash in bank 1,082
Accounts receivable 1950
Receivable from sale of
discontinued operations -
Inventories 1,019
Prepaid expenses and other assets 17
-------------
Current assets 4,069
Plant and Equipment, net 3,225
Other Assets:
Goodwill -
Design costs -
Retail assets held for sale -
Debt acquisition costs 1,096
Debt restructuring costs
Prepaid promotional expenses -
Other assets 102
-------------
Total assets $ 8,492
=============
Current Liabilities:
Accounts payable (post-petition) $ 738
Accrued expenses (post-petition) 268
Term loan note -
Revolving loan -
-------------
Current liabilities 1,006
Long Term Liabilities:
Long-term debt (pre-petition) 12,319
Liabilities Subject to Compromise:
Current maturities of long term debt and capital lease (pre-petition) 9
Accounts payable (pre-petition) 5,893
Accrued expenses (pre-petition) 1,546
Accrued loss on future purchase commitments (pre-petition) -
Allowance for operating losses of discontinued segment (pre-petition) 1,828
-------------
Liabilities subject to compromise 9,276
Minority interests 50
Shareholders' Equity:
Common stock 1
Additional paid-in capital 151,693
Accumulated deficit in earnings (165,403)
Treasury stock (450)
-------------
Total Shareholders' Equity (14,159)
-------------
Total Liabilities and Shareholders' Equity $ 8,492
=============
</TABLE>
Exhibit 1
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
CONSOLIDATED INCOME STATEMENT - UNAUDITED
AS OF OCTOBER 31, 1999
($000'S)
<TABLE>
<S> <C>
Sales $ 954
Cost of goods sold 753 (1)
---------------
Gross profit 201
Operating expenses
Customer -
Sales 5
Distribution 6
Marketing 1
General administrative 358 (2) (3)
MIS administrative 45 (4)
---------------
Total operating expenses 415
Operating income (loss) (214)
(Gain) loss on sale of assets -
Interest expense -
(Gain) loss on purchase commitments -
Other (income) expense
---------------
Net income (loss) $ (214)
===============
</TABLE>
NOTES:
( 1 ) Includes Depreciation of $93K
( 2 ) Includes Legal Expenses of $100K
( 3 ) Jablum A/R Other of $154K appears to be uncollectable
and unrecoverable. This deposit was recorded in 1998.
The write off of these losses were previously taken to G & A
( 4 ) Includes Depreciation of IS Computer System of $21K
Exhibit 2
Page 11 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
POST-PETITION CASH RECEIPTS AND DISBURSEMENTS
FOR THE MONTH ENDED OCTOBER 31, 1999
($000's)
<TABLE>
<CAPTION>
==============
9/30/99
10/31/99
==============
<S> <C>
RECEIPTS:
Lockbox $ -
Other 1,280
--------------
1,280
DISBURSEMENTS:
Green Coffee -
Packaging & Flavoring 188
Payroll & Benefits 485
Plant Overhead 207
Customer Expenses
Distribution Costs 13
Sales Costs -
Marketing -
Management Info. Systems 15
Administrative 33
Professional Fees 201
Interest Expense & Bank Fees -
Slotting Fees
Capital Expenditures 48
Property Taxes 131
Other -
Other - Return of Customer Payment to P & G
--------------
Total Disbursements 1,321
Net Cash Flow (41)
-
-
--------------
Net Cash Flow (41)
Beginning Cash 424
--------------
Ending Cash Before Float 383
Outstanding Check Float 699
Deposits Not Credited -
--------------
Cash Ledger Balance per Bank $ 1,082
==============
</TABLE>
Exhibit 3
Page 12 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
AGING OF ACCOUNTS RECEIVABLE
AS OF OCTOBER 31, 1999
($000'S)
<TABLE>
<CAPTION>
Past Due
-------------------------- Allowance for Net
30 - 60 60 - 90 Over 90 Total Accounts Returns and Bad Accounts
0 - 30 Days(a) Days Days (a) Receivable Debts Receivable
- -------------- ---- ---- --- ---------- ----- ----------
<S> <C> <C> <C> <C> <C> <C>
$ 762 $ 498 $ 150 $ 111 $1,521 $ 1,521
Cash sales 6K billed in April $ 10
A/R Other - Rebilling $ 48
Accrued P&G Sales - Current $ 200
A/R Coffee Broker Over 180 Past due $ 171
-------
Total A/R $ 1,950
=======
</TABLE>
Exhibit 4
Page 13 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
AGING OF ACCOUNTS RECEIVABLE
AS OF OCTOBER 31, 1999
($000's)
<TABLE>
<CAPTION>
TOTAL
ACCOUNTS
0-30 DAYS 31-60 DAYS 61-90 DAYS 91+ DAYS(B) PAYABLE
--------- ---------- ---------- ----------- -------
<S> <C> <C> <C> <C>
$ 120 $ (43) $ (19) $ (16) $42
Outstanding Checks, Wells Fargo Account No. 337788970 145
Outstanding Checks, Wells Fargo Account No. 337789424 393
Outstanding Checks, Wells Fargo Account No. 4595852287 26
Outstanding Checks, FUNB Account No. 2155300194336 132
-------------
Total Accounts Payable $738
=============
</TABLE>
Notes:
(a) Post-petition accounts payable debit balance results from prepayments for
inventory/materials not yet received. (includes est.)
(b) Amounts over 90 days consist primarily of 20% holdback on professional fees.
Exhibit 5
Page 14 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
STATUS OF POST-PETITION TAXES
AS OF OCTOBER 31, 1999
($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) $ - $ 67.6 $67.6 $ - $ -
Unemployment (a) - - - - -
----------------------------------------------------------------------------
TOTAL FEDERAL - 67.6 67.6 - -
STATE
Withholding (a) 26.0 - 1.1 24.9 -
Unemployment (a) 0.1 - - 0.1 -
Income 2.3 - - 2.3 -
Property 247.7 - 65.1 182.6 -
Sales 77.2 - 0.3 76.9 -
Franchise (b) 128.2 - - 128.2 -
----------------------------------------------------------------------------
TOTAL STATE AND LOCAL 481.5 - 66.4 415.1 -
----------------------------------------------------------------------------
TOTAL TAXES $ 481.5 $ 67.6 $134.0 $ 415.1 $ -
============================================================================
</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 15 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
BANK RECONCILIATION
AS OF OCTOBER 31, 1999
($000's)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
ACCOUNT #1 ACCOUNT #2 ACCOUNT # 3 ACCOUNT #4 ACCOUNT #5
- ------------------------------------------------------------------------------------------------------------------
A. BANK: FUNB CHASE CHASE FUNB FUNB
--------------------------------------------------------------------------
B. ACCOUNT NUMBER: 2000000482626 066-611121 312-7934031-66 2079900003505 2155300194336
--------------------------------------------------------------------------
C. PURPOSE (TYPE): DEPOSITORY DEPOSITORY CHECKING CHECKING PAYROLL
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. BALANCE PER BANK STATEMENT $ - $ - $ - $ - $ 145.3
- ------------------------------------------------------------------------------------------------------------------
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 0.0 0.0 0.0
- ------------------------------------------------------------------------------------------------------------------
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 0.0 0.0 (132.1)
- ------------------------------------------------------------------------------------------------------------------
4. OTHER RECONCILING ITEMS 0.0 0.0 0.0 0.0 0.0
- ------------------------------------------------------------------------------------------------------------------
5. MONTH END BALANCE PER BOOKS $ - $ - $ - $ - $ 13.2
- ------------------------------------------------------------------------------------------------------------------
6. NUMBER OF LAST CHECK WRITTEN
- ------------------------------------------------------------------------------------------------------------------
<CAPTION>
---------------------------------------------------------------------------------
ACCOUNT #6 ACCOUNT #7 ACCOUNT #8 ACCOUNT #9 ACCOUNT #10
- ----------------------------------------------------------------------------------------------------------------------------------
A. BANK: FUNB WELLS FARGO WELLS FARGO WELLS FARGO WELLS FARGO
---------------------------------------------------------------------------------
B. ACCOUNT NUMBER: 2090000011450 2090000011450 337788970 337789424 4595852287 TOTAL
---------------------------------------------------------------------------------
C. PURPOSE (TYPE): DEPOSITORY 337789002 CHECKING CHECKING PAYROLL
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. BALANCE PER BANK STATEMENT $ - $ 0.5 $ 627.5 $ 264.7 $43.6 $1,081.5
- ----------------------------------------------------------------------------------------------------------------------------------
2. ADD: TOTAL DEPOSITS NOT CREDITED 0.0 0.0 0.0 0.0 0.0 $ -
- ----------------------------------------------------------------------------------------------------------------------------------
3. SUBTRACT: OUTSTANDING CHECKS 0.0 0.0 (145.3) (393.5) (28.0) $ (698.9)
- ----------------------------------------------------------------------------------------------------------------------------------
4. OTHER RECONCILING ITEMS 0.0 0.0 0.0 $ -
- ----------------------------------------------------------------------------------------------------------------------------------
5. MONTH END BALANCE PER BOOKS $ - $ 0.5 $ 482.2 $ (128.9) $15.6 $ 382.6
- ----------------------------------------------------------------------------------------------------------------------------------
6. NUMBER OF LAST CHECK WRITTEN
- ----------------------------------------------------------------------------------------------------------------------------------
Outstanding Checks, Chase 312-7934031-66 -
---------------------------------------------------------------------------------------------
Outstanding Checks, FUNB 2155300194336 132.1
---------------------------------------------------------------------------------------------
Outstanding Checks, WF 4595852287 28.0
---------------------------------------------------------------------------------------------
Outstanding Checks, WF 337788970 145.3
---------------------------------------------------------------------------------------------
Outstanding Checks, WF 337789424 393.5
---------------------------------------------------------------------------------------------
Month End Balance Per Bank $1,081.5
---------------------------------------------------------------------------------------------
</TABLE>
Exhibit 7
Page 16 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
DISTRIBUTIONS TO INSIDERS
OCTOBER 31, 1999
<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>
OFFICERS:
Bilmes, Barry 13,942 - - - 84 - 209 14,235
Pennington, Linda 15,615 - - - - - 1,071 16,686
------------------------------------------------------------------------------------------------------------
$ 29,557 $ - $ - $ - $ 84 $ - $ 1,280 $30,921
============================================================================================================
</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 17 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
PAYMENTS TO PROFESSIONALS (A)
FOR THE MONTH ENDING OCTOBER 31, 1999
<TABLE>
<CAPTION>
NAME TOTAL
---- -----
<S> <C>
Weil, Gotshal & Manges, LLP $ 41
Bernard A. Katz $ 50
White & Case, LLP $ 50
Brownstein, Hyatt, Farber & Strickland, P.C. $ 33
Richard, Layton & Finger, P.A. $ 5
The Bayard Firm $ 6
Ernst & Young $ 4
Carrigan Chambers Dansky $ 11
-------------
$ 201
=============
</TABLE>
NOTES:
(a) Payments for post-petition fees and expenses in accordance with the Interim
Compensation Order.
Exhibit 9
Page 18 of 19
<PAGE>
BROTHERS GOURMET COFFEES, INC. AND AFFILIATED DEBTORS
INSURANCE POLICIES
AS OF OCTOBER 31, 1999
<TABLE>
<CAPTION>
TYPE OF POLICY TERM CARRIER ANNUAL PREMIUM FREQUENCY
-------------- ---- ------- -------------- ---------
<S> <C> <C> <C> <C>
Package 8/1/99 - 5/1/00 The Rowley Agency $54,975 Quarterly
TX Auto 8/1/99 - 5/1/00 The Rowley Agency $6,652 Quarterly
Workers' Compensation 8/1/99 - 5/1/00 The Rowley Agency $69,344 Quarterly
CA Worker's Compensation 8/1/99 - 5/1/00 The Rowley Agency $8,565 Quarterly
Umbrella - $10 million 8/1/99 - 5/1/00 The Rowley Agency $6,955 Quarterly
Umbrella - $15 million 8/1/99 - 5/1/00 The Rowley Agency $5,375 Quarterly
Directors and Officers 8/25/99-12/31/99 *** AON Risk Insurance $110,000 Periodic
</TABLE>
*** NOTE: Will Be Extended
Exhibit 10
Page 19 of 19
