ECO2 PLASTICS INC - FORM 8-K - EX-99.2 - MONTHLY OPERATING REPORT DATED JANUARY 31, 2010

Attached files

file	filename
8-K - CURRENT REPORT - ECO2 PLASTICS INC	form8-k.htm
EX-99.1 - LOAN AND SECURITY AGREEMENT AND A FORM OF THE NOTE - ECO2 PLASTICS INC	exhibit99-1.htm

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA

In re: [CASE NAME]		ECO2 Plastics Inc.				Case No.				09-33702 DM
		A Delaware Corporation
						CHAPTER 11
						MONTHLY OPERATING REPORT
						(GENERAL BUSINESS CASE)
SUMMARY OF FINANCIAL STATUS
		MONTH ENDED:	Jan-10			PETITION DATE:				11/24/09
	1.	Debtor in possession (or trustee) hereby submits this Monthly Operating Report on the Accrual Basis of accounting (or if checked here
		the Office of the U.S. Trustee or the Court has approved the Cash Basis of Accounting for the Debtor).
		Dollars reported in	$	1
	2.	Asset and Liability Structure				End of Current Month				End of Prior Month			As of Petition Filing
		a. Current Assets				$	448,548			$	535,707
		b. Total Assets				$	1,684,692			$	1,735,707		$	1,719,576
		c. Current Liabilities				$	215,284			$	191,903
		d. Total Liabilities				$	15,542,554			$	15,611,788		$	15,327,270		As Amended
	3.	Statement of Cash Receipts & Disbursements for Month				Current Month				Prior Month			Cumulative (Case to Date)
		a. Total Receipts				$	195,685			$	201,906		$	397,591
		b. Total Disbursements				$	169,199			$	145,855		$	315,054
		c. Excess (Deficiency) of Receipts Over Disbursements (a - b)				$	26,486			$	56,051		$	82,537
		d. Cash Balance Beginning of Month				$	61,729			$	5,678		$	5,678
		e. Cash Balance End of Month (c + d)				$	88,215			$	61,729		$	88,215
						Current Month				Prior Month			Cumulative (Case to Date)
	4.	Profit/(Loss) from the Statement of Operations				$	(76,073	)		$	(169,278	)	$	(274,424	)
	5.	Account Receivables (Pre and Post Petition)				$	177,755			$	315,255
	6.	Post-Petition Liabilities				$	215,284			$	191,903
	7.	Past Due Post-Petition Account Payables (over 30 days)				$	0			$	0
At the end of this reporting month:										Yes			No
	8.	Have any payments been made on pre-petition debt, other than payments in the normal												x
		course to secured creditors or lessors? (if yes, attach listing including date of
		payment, amount of payment and name of payee)
	9.	Have any payments been made to professionals? (if yes, attach listing including date of												x
		payment, amount of payment and name of payee)
	10.	If the answer is yes to 8 or 9, were all such payments approved by the court?
	11.	Have any payments been made to officers, insiders, shareholders, relatives? (if yes,												x
		attach listing including date of payment, amount and reason for payment, and name of payee)
	12.	Is the estate insured for replacement cost of assets and for general liability? (market value)									x
	13.	Are a plan and disclosure statement on file?												x
	14.	Was there any post-petition borrowing during this reporting period?												x
	15.	Check if paid: Post-petition taxes			; U.S. Trustee Quarterly Fees				X	; Check if filing is current for: Post-petition
		tax reporting and tax returns:			.
		(Attach explanation, if post-petition taxes or U.S. Trustee Quarterly Fees are not paid current or if post-petition tax
		reporting and tax return filings are not current.)
I declare under penalty of perjury I have reviewed the above summary and attached financial statements, and after making reasonable inquiry
believe these documents are correct.
Date:
						Responsible Individual

STATEMENT OF OPERATIONS (General Business Case)
										For the Month Ended	01/31/10
Current Month
Actual			Forecast			Variance						Cumulative (Case to Date)			Next Month Forecast
										Revenues:
						$	0		1	Gross Sales		$	0
$	0					$	0		2	less: Sales Returns & Allowances		$	0
$	0		$	0		$	0		3	Net Sales		$	0		$	0
$	0					$	0		4	less: Cost of Goods Sold (Schedule 'B')		$	0
$	0		$	0		$	0		5	Gross Profit		$	0		$	0
$	0					$	0		6	Interest		$	0
						$	0		7	Other Income:
						$	0		8
						$	0		9
$	0		$	0		$	0		10	Total Revenues		$	0		$	0
										Expenses:
$	26,654		$	29,192		$	2,538		11	Compensation to Owner(s)/Officer(s)		$	67,269		$	25,385
$	36,628		$	47,696		$	11,068		12	Salaries		$	93,870		$	34,884
$	1,562					$	(1,562	)	13	Payroll Processing Fee		$	1,562		$	910
						$	0		14
$	1,499		$	1,500		$	1		15	Rent/Lease: Personal Property		$	4,810		$	1,500
$	19,300		$	15,000		$	(4,300	)	16	Real Property		$	51,584		$	8,600
$	13,514		$	11,110		$	(2,404	)	17	Insurance		$	30,693		$	10,912
						$	0		18	Management Fees
						$	0		19	Depreciation
$	4,530		$	7,074		$	2,544		20	Taxes: Employer Payroll Taxes		$	9,762		$	4,821
						$	0		21	Real Property Taxes
						$	0		22	Other Taxes
$	1,068					$	(1,068	)	23	Moving Expense		$	1,068		$	11,000
$	261		$	135		$	(126	)	24	Other Administrative (Cafeteria)		$	761
			$	21,195		$	21,195		25	Interest					$	21,897
$	1,787		$	540		$	(1,247	)	26	Other Expenses:	General	$	4,837		$	2,000
$	1,795		$	1,735		$	(60	)	27	Utilities		$	3,470		$	1,500
$	742		$	765		$	23		28	Telephone		$	1,515		$	765
			$	18,750		$	18,750		29	Cool Clean Settlement					$	18,750
$	3,500		$	2,500		$	(1,000	)	30	Employee Expenses		$	6,000		$	2,500
						$	0		31	Fees for Initial SEC 8k Filing		$	1,205		$	1,000
$	8,925					$	(8,925	)	32	Patent Expenses		$	8,925		$	11,000
$	582					$	(582	)	33	Transfer Agent Stock Listing charges		$	582
			$	54,905		$	54,905		34	Prepetition Employee Expenses					$	32,943
$	122,346		$	212,096		$	89,750		35	Total Expenses		$	287,913		$	190,367
$	(122,346	)	$	(212,096	)	$	89,750		36	Subtotal		$	(287,913	)	$	(190,367	)
$	(49,055	)	$	(50,000	)	$	(945	)	37	Reorganization Items: Professional Fees		$	(171,242	)	$	(50,000	)
						$	0		38	Provisions for Rejected Executory Contracts		$	0
						$	0		39	Interest Earned on Accumulated Cash from		$	0
										Resulting Chp 11 Case			0
$	96,303		$	87,150		$	9,153		40	Gain or (Loss) from Sale of Equipment		$	185,705
$	(975	)				$	975		41	U.S. Trustee Quarterly Fees		$	(975	)
						$	0		42
$	46,273		$	37,150		$	9,123		43	Total Reorganization Items		$	13,489		$	(50,000	)
$	(76,073	)	$	(174,946	)	$	98,873		44	Net Profit (Loss) Before Federal & State Taxes		$	(274,424	)	$	(240,367	)
						$	0		45	Federal & State Income Taxes
$	(76,073	)	$	(174,946	)	$	98,873		46	Net Profit (Loss)		$	(274,424	)	$	(240,367	)

Attach an Explanation of Variance to Statement of Operations (For variances greater than +/- 10% only):

Exhibit A - Statement of Operations - Explanation of Variances +/- 10%

Line 12. A portion of the labor forecast should have been a part of asset removal and charged to gain or loss.
Line 13. Payroll processing fee included as part of labor forecast
Line 16. Revised amount after completion of storage rental agreement
Line 17. Workers comp insurance ($1,436) bill for December not received until January
Line 20. Prior month accrual not deducted from forecast and plant labor taxes should have been forecast in gain or loss account
Line 23. Early expenditure of moving expenses budgeted for next month.
Line 25. Not paid due to delay in DIP financing
Line 26. Charge for Quickbooks Online Annual Fee ($754) not in original forecast
Line 29. Not paid due to delay in DIP financing. Extended until Feb 24th
Line 30. Late submission of December expense report
Line 32. Early expenditures on patent maintenance budgeted for next month
Line 34. Pre petition key employee expenses in forecast but not yet approved by the Court.

BALANCE SHEET
(General Business Case)
For the Month Ended					01/31/10
		Assets
					From Schedules		Market Value
		Current Assets
	1		Cash and cash equivalents - unrestricted				$	88,215
	2		Cash and cash equivalents - restricted
	3		Accounts receivable (net)			A	$	177,755
	4		Inventory			B	$	0
	5		Prepaid expenses
	6		Professional retainers				$	82,578
	7		Other:	Honeywell License			$	100,000
	8
	9			Total Current Assets			$	448,548
		Property and Equipment (Market Value)
	10		Real property			C	$	0
	11		Machinery and equipment			D	$	1,190,000
	12		Furniture and fixtures			D
	13		Office equipment			D	$	10,000
	14		Leasehold improvements			D	$	0
	15		Vehicles			D	$	0
	16		Other:			D
	17					D
	18					D
	19					D
	20					D
	21			Total Property and Equipment			$	1,200,000
		Other Assets
	22		Loans to shareholders
	23		Loans to affiliates
	24		Security Deposit to Norris Industry (Landlord)				$	36,144
	25
	26
	27
	28			Total Other Assets			$	36,144
	29			Total Assets			$	1,684,692
		NOTE:
			Indicate the method used to estimate the market value of assets (e.g., appraisals; familiarity with comparable market
			prices, etc.) and the date the value was determined.


Liabilities and Equity
(General Business Case)

		Liabilities From Schedules
		Post-Petition
		Current Liabilities
	30		Salaries and wages		$	9,040
	31		Payroll taxes		$	691
	32		Real and personal property taxes
	33		Income taxes
	34		Sales taxes
	35		Notes payable (short term)
	36		Accounts payable (trade)	A	$	34,311
	37		Real property lease arrearage
	38		Personal property lease arrearage
	39		Accrued professional fees		$	171,242
	40		Current portion of long-term post-petition debt (due within 12 months)
	41		Other:
	42
	43
	44		Total Current Liabilities		$	215,284
	45	Long-Term Post-Petition Debt, Net of Current Portion
	46		Total Post-Petition Liabilities		$	215,284
		Pre-Petition Liabilities (allowed amount)
	47		Secured claims	F	$	12,403,473
	48		Priority unsecured claims	F	$	242,761
	49		General unsecured claims	F	$	2,681,036
	50		Total Pre-Petition Liabilities		$	15,327,270
	51		Total Liabilities		$	15,542,554
		Equity (Deficit)
	52	Retained Earnings/(Deficit) at time of filing			$	(102,005,916	)
	53	Capital Stock			$	1,039,564
	54	Additional paid-in capital			$	117,000,652
	55	Cumulative profit/(loss) since filing of case			$	(274,424	)
	56	Post-petition contributions/(distributions) or (draws)
	57
	58	Market value adjustment			$	(29,617,738	)
	59		Total Equity (Deficit)		$	(13,857,862	)
	60	Total Liabilities and Equity (Deficit)			$	1,684,692

					$	0

SCHEDULES TO THE BALANCE SHEET

(General Business Case)

Schedule A

Accounts Receivable and (Net) Payable

Receivables and Payables Agings

Accounts Receivable

[Pre and Post Petition]

Accounts Payable

[Post Petition]

Past Due

Post Petition Debt

0 -30 Days

34,311

31-60 Days

61-90 Days

91+ Days

177,755

Total accounts receivable/payable

177,755

34,311

Allowance for doubtful accounts

Accounts receivable (net)

177,755

Schedule B

Inventory/Cost of Goods Sold

Types and Amount of Inventory(ies)

Cost of Goods Sold

Inventory(ies)

Balance at

End of Month

Inventory Beginning of Month

Add -

Retail/Restaurants -

Net purchase

Product for resale

Direct labor

Manufacturing overhead

Distribution -

Freight in

Products for resale

Other:

Manufacturer -

Raw Materials

Work-in-progress

Less -

Finished goods

Inventory End of Month

Shrinkage

Other - Explain

Personal Use

Cost of Goods Sold

TOTAL

Method of Inventory Control

Inventory Valuation Methods

Do you have a functioning perpetual inventory system?

Indicate by a checkmark method of inventory used.

Yes

How often do you take a complete physical inventory?

Valuation methods -

FIFO cost

Weekly

LIFO cost

Monthly

Lower of cost or market

Quarterly

Retail method

Semi-annually

Other

Annually

Explain

Date of last physical inventory was

1/31/2010 0:00

Date of next physical inventory is

Schedule C Real Property
Description		Cost	Market Value






	Total	$0	$0

Schedule D Other Depreciable Assets
Description		Cost	Market Value
Machinery & Equipment -
	Plastic Plant		$1,190,000
	Assets for Sale


	Total	$0	$1,190,000
Furniture & Fixtures -




	Total	$0	$0
Office Equipment -
			$10,000


	Total	$0	$10,000
Leasehold Improvements -




	Total	$0	$0
Vehicles -




	Total	$0	$0

Schedule E
Aging of Post-Petition Taxes
(As of End of the Current Reporting Period)
Taxes Payable		0-30 Days		31-60 Days		61-90 Days		91+ Days		Total
Federal
	Income Tax Withholding									$	0
	FICA - Employee									$	0
	FICA - Employer									$	0
	Unemployment (FUTA)									$	0
	Income									$	0
	Other (Attach List)									$	0
Total Federal Taxes		$	0	$	0	$	0	$	0	$	0
State and Local
	Income Tax Withholding									$	0
	Unemployment (UT)									$	0
	Disability Insurance (DI)									$	0
	Empl. Training Tax (ETT)									$	0
	Sales									$	0
	Excise									$	0
	Real property									$	0
	Personal property									$	0
	Income									$	0
	Other (Attach List)									$	0
Total State & Local Taxes		$	0	$	0	$	0	$	0	$	0
Total Taxes		$	0	$	0	$	0	$	0	$	0
Schedule F
Pre-Petition Liabilities
List Total Claims For Each Classification -						Claimed Amount		Allowed Amount (b)
	Secured claims (a)					$	12,403,473	$	12,403,473
	Priority claims other than taxes					$	84,276	$	36,750
	Priority tax claims					$	206,011	$	206,011
	General unsecured claims					$	2,633,510	$	2,681,036	As amended
	(a) List total amount of claims even it under secured.
	(b) Estimated amount of claim to be allowed after compromise or litigation. As an example, you are a defendant in a lawsuit
	alleging damage of $10,000,000 and a proof of claim is filed in that amount. You believe that you can settle the case for a
	claim of $3,000,000. For Schedule F reporting purposes you should list $10,000,000 as the Claimed Amount and
	$3,000,000 as the Allowed Amount.
Schedule G Rental Income Information Not applicable to General Business Cases
Schedule H Recapitulation of Funds Held at End of Month
		Account 1		Account 2		Account 3		Account 4
Bank		Wells Fargo		Wells Fargo		Petty Cash
Account Type		Checking		Savings
Account No.		xxx-xxx-1215		xxx-xxx-2116
Account Purpose		operations
Balance, End of Month		$	87,495	$	678	$	42
Total Funds on Hand for all Accounts		$	88,215
Attach copies of the month end bank statement(s), reconciliation(s), and the check register(s) to the Monthly Operating Report.

STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS
Increase/(Decrease) in Cash and Cash Equivalents
			For the Month Ended	01/31/10
					Actual Current Month		Cumulative (Case to Date)
		Cash Receipts
	1	Rent/Leases Collected			$	0	$	0
	2	Cash Received from Sales
	3	Interest Received			$	0	$	0
	4	Borrowings			$	0	$	0
	5	Funds from Shareholders, Partners, or Other Insiders
	6	Capital Contributions			$	0	$	0
	7	Sales of Assets			$	190,500	$	389,050
	8	Sales of Assets Scrap			$	5,051	$	8,403
	9	Refund (Honeywell)					$	4
	10	Refund (Cafeteria Plan)			$	135	$	135
	11
	12		Total Cash Receipts		$	195,685	$	397,592
		Cash Disbursements
	13	Payments for Inventory				0		0
	14	Selling			$	0	$	0
	15	Administrative / Legal			$	65,127	$	65,127
	16	Capital Expenditures			$	0	$	0
	17	Principal Payments on Debt			$	0	$	0
	18	Interest Paid			$	0	$	0
		Rent/Lease:			$	0	$	0
	19		Personal Property		$	3,302	$	3,302
	20		Real Property		$	15,000	$	47,284
		Amount Paid to Owner(s)/Officer(s)			$	0	$	0
	21		Salaries		$	23,128	$	59,693
	22		Draws		$	0	$	0
	23		Commissions/Royalties		$	0	$	0
	24		Expense Reimbursements		$	1,500	$	5,148
	25		Other Employee Expense Reimbursements		$	2,533	$	0
	26	Salaries/Commissions (less employee withholding)			$	33,931	$	74,414
	27	Management Fees			$	0	$	0
		Taxes:			$	0	$	0
	28		Employee Withholding		$	13,220	$	25,509
	29		Employer Payroll Taxes		$	5,454	$	9,834
	30		Real Property Taxes		$	0	$	0
	31		Other Taxes		$	0	$	0
	32	Other Cash Outflows:			$	0	$	0
	33		Liability / Life Insurance		$	1,665	$	13,636
	34		Health Benefits				$	5,208
	35		Payroll Processing		$	1,562	$	2,018
	36		Misc Supplies		$	2,402	$	3,426
	37		Bank Charges		$	376	$	456
	38		Total Cash Disbursements:		$	169,199	$	315,055
	39	Net Increase (Decrease) in Cash			$	26,486	$	82,537
	40	Cash Balance, Beginning of Period			$	61,729	$	5,678
	41	Cash Balance, End of Period			$	88,215	$	88,215

ECO2 PLASTICS INC - FORM 8-K - EX-99.2 - MONTHLY OPERATING REPORT DATED JANUARY 31, 2010 - February 17, 2010

Attached files