NBC ACQUISITION CORP - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - FORM 8-K - NBC ACQUISITION CORP	c22176e8vk.htm

EXHIBIT 99.1

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE



In re: Nebraska Book Company, Inc., et al.,
	Case No. (Jointly Administered)	11-12005(PJW)
	Reporting Period:	July 1 — July 31, 2011

	Federal Tax I.D. #	47-0549819

CORPORATE MONTHLY OPERATING REPORT

File with the Court and submit a copy to the United States Trustee within 30 days after the end of the month and submit a copy of the report to any official committee appointed in the case.


		Document	Explanation
DOCUMENTS	Form No.	Attached	Attached
Schedule of Disbursements	MOR-1a	x
Bank Account Information	MOR-1b		x
Statement of Operations (Income Statement)	MOR-2	x
Balance Sheet	MOR-3	x
Status of Post-petition Taxes	MOR-4		x
Accounts Receivable Reconciliation and Aging	MOR-5	x
Payments to Professionals	MOR-6	x
Debtor Questionnaire	MOR-7	x

I declare under penalty of perjury (28 U.S.C. Section 1746) that this report and the attached documents are true and correct to the best of my knowledge and belief.


/s/ Alan G. Siemek		August 30, 2011

Signature of Authorized Individual*		Date

Alan G. Siemek

Printed Name of Authorized Individual

Chief Financial Officer

Title


*		Authorized individual must be an officer, director or shareholder if debtor is a corporation; a partner if debtor is a partnership; a manager or member if debtor is a limited liability company

Nebraska Book Company, Inc., et al.,
MOR1a
Disbursements
July 2011


Company Name	Case Number		Federal ID Number		Amount
NBC Holdings Corporation		11-12006		75-3147477	$	—
NBC Acquisition Corporation		11-12008		47-0793347		—
Nebraska Book Company, Inc.		11-12005		47-0549819		42,748,664
Specialty Books, Inc.		11-12007		75-3044807		2,020
NBC Textbooks, LLC		11-12004		20-1831425		3,829,088
College Bookstores of America, Inc.		11-12009		36-3309518		21,808,067
Campus Authentic, LLC		11-12003		90-0439156		67
Net Textstore, LLC		11-12002		14-1996469		20,000

Total					$	68,407,906

The disbursement information is based on the company’s books and records that are maintained and prepared under Generally Accepted Accounting Principles (“GAAP”). The information has not been audited.

August 30, 2011

Office of the United States Trustee

Subject: July Monthly Operating Report Attestation Regarding Bank Account Reconciliations

The Debtor, Nebraska Book Company, Inc. and its affiliated Debtors, hereby submits this attestation regarding bank account reconciliations in lieu of providing copies of bank statements and copies of all account reconciliations.

The Debtor has, on a timely basis, performed all bank account reconciliationS in the ordinary course of its business. Copies of bank account statements and reconciliations are available for inspection upon request by the United States Trustee’s Office.


	/s/ Alan G. Siemek
	Name:	Alan G. Siemek
	Position: Chief Financial Officer


	Sworn to and Subscribed before me on this 30^th day of August, 2011
	/s/ Mary A. Lockard
	Notary Public

	My Commission Expires: March 5, 2013

Nebraska Book Company, Inc., et al.
MOR 2
(DEBTOR IN POSSESSION AS OF JUNE 27, 2011)
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE FOUR MONTHS ENDED JULY 31, 2011
(UNAUDITED)


																	COLLEGE
	CONSOLIDATED NBC						NBC ACQUISITION			NEBRASKA BOOK			NBC TEXTBOOKS,		NET TEXTSTORE,		BOOKSTORES OF			SPECIALTY			CAMPUS
	ACQUIS CORP			ELIMINATIONS			CORP			COMPANY, INC.			LLC		LLC		AMERICA			BOOKS, INC.			AUTHENTIC

REVENUES, net of returns	$	108,539,300		$	(18,091,780	)	$	—		$	47,677,628		$	57,126,273	$	2,090,513	$	17,625,411		$	2,066,073		$	45,184

COSTS OF SALES (exclusive of depreciation shown below)		63,134,432			(18,311,993	)		—			34,589,331			33,369,203		794,729		11,123,006			1,532,498			37,658


Gross profit		45,404,868			220,213			—			13,088,297			23,757,069		1,295,785		6,502,404			533,574			7,526

OPERATING EXPENSES:

Selling, general and administrative		50,555,096			220,213			—			36,384,993			5,455,275		976,312		7,007,586			504,646			6,069
Depreciation		2,755,754			—			—			2,108,044			249,960		1,726		386,709			9,316			—
Amortization		2,693,970			—			—			555,764			1,777,152		—		327,222			33,832			—
Stock-based compensation		11,640			—			—			11,640			—		—		—			—			—
Intercompany administrative charge		—			—			—			(3,041,788	)		1,187,800		95,200		1,668,388			90,400			—


		56,016,460			220,213			—			36,018,653			8,670,187		1,073,239		9,389,906			638,194			6,069


INCOME (LOSS) FROM OPERATIONS		(10,611,592	)		—			—			(22,930,355	)		15,086,882		222,546		(2,887,501	)		(104,620	)		1,456

OTHER EXPENSES — INCOME:
Interest expense		15,967,836			—			2,082,725			13,885,105			—		—		—			6			—
Interest income		27,260			—			—			19,406			—		—		7,389			464			—


		15,940,576			—			2,082,725			13,865,699			—		—		(7,389	)		(458	)		—


INCOME (LOSS) BEFORE REORGANIZATION ITEMS AND INCOME TAXES		(26,552,168	)		—			(2,082,725	)		(36,796,054	)		15,086,882		222,546		(2,880,112	)		(104,161	)		1,456

REORGANIZATION ITEMS		6,913,038			—			—			6,913,038			—		—		—			—			—


INCOME (LOSS) BEFORE INCOME TAXES		(33,465,206	)		—			(2,082,725	)		(43,709,092	)		15,086,882		222,546		(2,880,112	)		(104,161	)		1,456

INCOME TAX EXPENSE (BENEFIT)		(8,120,000	)		—			(322,000	)		(12,052,000	)		5,362,000		79,000		(1,150,000	)		(37,000	)		—


NET INCOME (LOSS)	$	(25,345,206	)	$	—		$	(1,760,725	)	$	(31,657,092	)	$	9,724,882	$	143,546	$	(1,730,112	)	$	(67,161	)	$	1,456

Nebraska Book Company, Inc., et al.
MOR 3
(DEBTOR IN POSSESSION AS OF JUNE 27, 2011)
CONSOLIDATED BALANCE SHEETS
JULY 31, 2011 (UNAUDITED)


																		COLLEGE
	CONSOLIDATED NBC						NBC ACQUISITION			NEBRASKA BOOK			NBC TEXTBOOKS,			NET TEXTSTORE,		BOOKSTORES OF			SPECIALTY			CAMPUS
	ACQUIS CORP			ELIMINATIONS			CORP			COMPANY, INC.			LLC			LLC		AMERICA			BOOKS, INC.			AUTHENTIC

ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	72,865,173		$	—		$	—		$	72,865,173		$	—		$	—	$	3,323,881		$	(15,339	)	$	—
Intercompany receivable (payable)		—			—			—			0			146,741,596			3,711,395		(40,721,524	)		(2,483,774	)		(34,855	)
Receivables, net		61,010,446			—			42			61,010,404			38,160,201			182,839		5,954,545			776,073			5,599
Inventories		146,173,947			—			—			146,173,947			22,969,249			2,136,392		35,584,607			1,731,927			—
Recoverable income taxes		11,810,263			—			—			11,810,263			—			—		—			—			—
Deferred income taxes		7,558,819			—			(45,585	)		7,604,404			5,529,000			—		806,000			101,000			—
Prepaid expenses and other assets		42,007,092			—			—			42,007,092			527,014			—		10,797,701			68,552			—

		341,425,740			—			(45,543	)		341,471,283			213,927,060			6,030,626		15,745,210			178,439			(29,256	)

PROPERTY AND EQUIPMENT, net of depreciation & amortization		38,792,192			—			—			38,792,192			1,027,824			19,883		3,990,455			326,723			—

GOODWILL		129,436,731			—			—			129,436,731			—			—		15,671,109			—			—

IDENTIFIABLE INTANGIBLES, net of amortization		109,823,953			—			—			109,823,953			67,275,055			—		2,215,082			1,267,783			—

DEBT ISSUE COSTS, net of amortization		2,283,769			—			446,950			1,836,819			—			—		—			—			—

INVESTMENT IN SUBSIDIARIES		—			(128,840,082	)		(22,450,855	)		151,290,937			—			—		—			—			—

OTHER ASSETS		711,451			—			—			711,451			(47,424	)		—		49,013			—			—


	$	622,473,837		$	(128,840,082	)	$	(22,049,448	)	$	773,363,367		$	282,182,515		$	6,050,509	$	37,670,868		$	1,772,945		$	(29,256	)


LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

CURRENT LIABILITIES:
Accounts payable	$	25,549,984		$	—		$	—		$	25,549,984		$	1,905,052		$	8,491	$	2,435,614		$	616,192		$	164
Accrued employee compensation and benefits		7,651,196			—			—			7,651,196			1,346,571			—		771,389			41,101			—
Accrued interest		2,565,315			—			—			2,565,315			—			—		—			—			—
Accrued incentives		6,514,681			—			—			6,514,681			6,514,681			—		—			—			—
Accrued expenses		2,249,203			—			—			2,249,203			7,668			—		760,587			4,431			—
Income taxes payable		—			—			—			—			83,013,854			1,534,000		2,675,246			(154,511	)		(4,533	)
Deferred revenue		4,938,896			—			—			4,938,896			—			—		321			—			—
Current maturities of long-term debt		199,874,982			—			—			199,874,982			—			—		—			—			—
DIP term loan facility		123,858,992			—			—			123,858,992			—			—		—			—			—

Total current liabilities		373,203,249			—			—			373,203,249			92,787,827			1,542,491		6,643,158			507,213			(4,369	)

LONG-TERM DEBT, net of current maturities		101,340			—			—			101,340			—			—		—			—			—

DEFERRED INCOME TAXES		41,309,157			—			(10,292,472	)		51,601,629			25,411,000			7,000		978,000			496,000			—

LIABILITIES SUBJECT TO COMPROMISE		272,581,482			—			52,964,416			219,617,066			36,659			957		2,574,308			128,432			—

COMMITMENTS

REDEEMABLE PREFERRED STOCK
Series A redeemable preferred stock, $.01 par value, 20,000 shares authorized, 10,000 shares outstanding at redemption value		14,076,596			—			14,076,596						—			—		—			—			—

STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock, voting, authorized 5,000,000 shares of $.01 par value;
554,094 shares issued and outstanding		5,541			(100	)		5,541			100			—			—		—			—			—
Additional paid-in capital		111,292,929			(210,372,191	)		111,292,929			210,372,191			59,817,667			—		346,232			1,923,150			—
Note receivable from stockholder		(94,302	)		—			(94,302	)					—			—		—			—			—
Retained earnings (Accumulated deficit)		(190,002,156	)		81,532,209			(190,002,156	)		(81,532,209	)		104,129,363			4,500,061		27,129,171			(1,281,850	)		(24,887	)

Total stockholders’ equity (deficit)		(78,797,988	)		(128,840,082	)		(78,797,988	)		128,840,082			163,947,030			4,500,061		27,475,403			641,300			(24,887	)


	$	622,473,837		$	(128,840,082	)	$	(22,049,448	)	$	773,363,367		$	282,182,515		$	6,050,509	$	37,670,868		$	1,772,945		$	(29,256	)

August 30, 2011

Office of the United States Trustee

Subject: July Monthly Operating Report Attestation Regarding Postpetition Taxes

The Debtor, Nebraska Book Company, Inc. and its affiliated Debtors, hereby submit this attestation regarding postpetition taxes.

All postpetition taxes for the Debtors, which are not subject to dispute or reconciliation, are current. There are no material tax disputes or reconciliations.



	/s/ Alan G. Siemek
	Name:	Alan G. Siemek
	Position: Chief Financial Officer

Sworn to and Subscribed
before me on this 30^th
day of August, 2011



/s/ Mary A. Lockard
Notary Public

My Commission Expires: March 5, 2013

Nebraska Book Company, Inc., et al.,
MOR5
Accounts Reconciliation and Aging
July 2011

ACCOUNTS RECEIVABLE RECONCILIATION AND AGING (1)


Accounts Receivable Reconciliation	Amount

Total Accounts Receivable at the Beginning of the Reporting Period	$	29,194,999
Plus: Amounts billed during the period		45,517,998
Less: Amounts collected during the period		(12,742,208	)
Less: Amounts written off or returned during the period		(1,715,985	)
Less: Customer rebates applied against receivable		(475,296	)
Plus (less): Miscellaneous Other		119,192

Change in accounts receivable, net		30,703,701
Less: Allowance for uncollectible accounts		(1,283,360	)

Total Accounts Receivable at the End of the Reporting Period	$	58,615,340


Accounts Receivable Aging	7/31/2011

0-30 days old		42,366,415
31-60 days old		10,509,720
61-90 days old		3,811,167
Over 90 days old		3,211,398
Total Aged Accounts Receivable		59,898,700
Less: Allowance for uncollectible accounts		(1,283,360	)

Net Accounts Receivable	$	58,615,340


(1)		“Accounts receivable” in the accompanying Balance Sheet under Form MOR-3 includes certain items which are not included in this table, including receivables for returns to publishers and buy funds receivable.

Nebraska Book Company, Inc., et al.,
MOR6
Payments to Professionals
July 2011


Name	Amount
Kurtzman Carson Consultants, LLC	$	68,330
Brown Rudnick LLP		68,648
Young, Conaway, Stargatt & Taylor, LLP		9,323

Total	$	146,301

The Professional Fees information is based on the company’s books and records that are maintained and prepared under Generally Accepted Accounting Principles (“GAAP”). The information has not been audited.


In re: Nebraska Book Company, Inc., et al.,
Case No. (Jointly Administered)		11-12005(PJW)
Reporting Period:		July 31, 2011
Federal Tax I.D. #		MOR 7 47-0549819

Debtor Questionnaire


	Must be completed each month. If the answer to any of the questions is “Yes”, provide a detailed explanation of each item. Attach additional sheets if necessary.	Yes	No
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 this reporting period?		X
3	Is the Debtor delinquent in the timely filing of any post-petition tax returns?		X
4	Are workers compensation, general liability or other necessary insurance coverages expired or cancelled, or has the debtor received notice of expiration or cancellation of such policies?		X
5	Is the Debtor delinquent in paying any insurance premium payment?		X
6	Have any payments been made on pre-petition liabilities this reporting period?	X
7	Are any post petition receivables (accounts, notes or loans) due from related parties?		X
8	Are any post petition payroll taxes past due?		X
9	Are any post petition State or Federal income taxes past due?		X
10	Are any post petition real estate taxes past due?		X
11	Are any other post petition taxes past due?		X
12	Have any pre-petition taxes been paid during this reporting period?	X
13	Are any amounts owed to post petition creditors delinquent?		X
14	Are any wage payments past due?		X
15	Have any post petition loans been received by the Debtor from any party?		X
16	Is the Debtor delinquent in paying any U.S. Trustee fees?		X
17	Is the Debtor delinquent with any court ordered payments to attorneys or other professionals?		X
18	Have the owners or shareholders received any compensation outside of the normal course of business?		X

NBC ACQUISITION CORP - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - September 2, 2011

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NBC ACQUISITION CORP Reports