TMST, Inc. - FORM 8-K - EX-99.1 - MONTHLY OPERATING REPORT

TMST, Inc. - FORM 8-K - EX-99.1 - MONTHLY OPERATING REPORT - March 21, 2012

Attached files

Attached files

file	filename
8-K - FORM 8-K - TMST, Inc.	d319573d8k.htm

Exhibit 99.1


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al. (1)				CASE NUMBER: 09-17787

OFFICE OF THE UNITED STATES TRUSTEE—BALTIMORE DIVISION

MONTHLY OPERATING REPORT

CHAPTER 11

BUSINESS DEBTORS

Form 2-A

COVER SHEET AND QUESTIONNAIRE

For Period Ended February 29, 2012


Accounting Method:		x Accrual Basis		¨ Cash Basis


Report/Document Attached	Previously Waived	REQUIRED REPORTS/DOCUMENTS
x	¨	1. Cash Receipts and Disursements Statement (Form 2-B)

x	¨	2. Balance Sheet (Form 2-C)

x	¨	3. Profit and Loss Statement (Form 2-D)

x	¨	4. Supporting Schedules (Form 2-E)

x	¨	5. Disbursements Summary (Form 2-F)

¨	x	6. Narrative (Form 2-G)

x	¨	7. Bank Statements for All Bank Accounts (See Exhibit A)

x	¨	8. Bank Statement Reconciliations for all Bank Accounts (See Exhibit A)

QUESTIONNAIRE

Yes

Please answer the questions below:

1. Is the business still operating?

)

2. Were any assets (other than inventory) sold this month?

3. Were all employees timely paid this month?

4. Are all insurance policies and operating licenses current and in effect?

)

5. Did you open any new bank accounts this month?

6. Did you deposit all receipts into your DIP account this month?

7. Have all taxes been timely paid (payroll, sales, etc.)?

8. Are you current on U.S. Trustee quarterly fees payments?

I declare under penalty of perjury that the following Monthly Operating Report, and any statements and attachments thereto are true, accurate and correct to the best of my belief.


Executed on: 3/20/12	Print Name: Joel I. Sher

	Signature:	/s/ Joel I. Sher

	Title: Chapter 11 Trustee

(1)

Includes the following Debtors: TMST, Inc. f/k/a Thornburg Mortgage, Inc. (Case No. 09-17787), TMST Home Loans, Inc. f/k/a Thornburg Mortgage Home Loans, Inc. (Case No. 09-17791), TMST Hedging Strategies, Inc. f/k/a Thornburg Mortgage Hedging Strategies, Inc. (Case No. 09-17792), and TMST Acquisition Subsidiary, Inc. f/k/a Thornburg Acquisition Subsidiary, Inc. (Case No. 09-17790). The Adfitech, Inc. Monthly Operating Report is filed separately under Case No. 09-17788.

(2)	The Chapter 11 Trustee is in the process of winding-up all operations.

(3)	TMST Home Loans, Inc. is currently in the process of withdrawing state licenses due to the sale of the Servicing Portfolio.

Rev. 4/2008

Page 1 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT (1)

For Period: 2/1/2012 to 2/29/2012

CASH FLOW SUMMARY


	Current Month			Accumulated
Beginning Cash Balance	$	101,743,117	(2)	$	16,847,967	(2)

2. Cash Receipts
Operations		1,748			27,770,183
Sale of Assets		—			80,041,433
Loans/advances		—			18,364,080
Other		—			23,927,639

Total Cash Receipts	$	1,748		$	150,103,335

3. Cash Disbursements
Operations		196,774			23,271,847
Debt Service/Secured loan payment		—			—
Professional fees/U.S. Trustee fees		491,702			23,165,399
Other		0			19,457,667

Total Cash Disbursements	$	688,476		$	65,894,913

4. Net Cash Flow (Total Cash Receipts less
Total Cash Disbursements)		(686,728	)		84,208,422

5. Ending Cash Balance (to Form 2-C)	$	101,056,389	(3)	$	101,056,389	(3)

CASH BALANCE SUMMARY


Account Name/Number	Institution	Bank Balance			Deposits In Transit		Outstanding Checks		Book Balance
xxxxxxx2822	New Mexico Bank & Trust	$	803,863			—	$	81,876		721,987
xxxxxxx0805	J.P. Morgan		—	(4)		—		—		—
xxxxxxx1807	New Mexico Bank & Trust		5,523			—		—		5,523
xxxxxxx2954	New Mexico Bank & Trust		24,012			—		2,646		21,366
xxxxxxx2989	New Mexico Bank & Trust		571			—		—		571
xxxxxxx5856	New Mexico Bank & Trust		446,393			—		—		446,393
xxxxxxx2842	New Mexico Bank & Trust		4,000,000			—		—		4,000,000
xxxxxxx9638	The Bank of New York Mellon		1,002			—				1,002
xxxxxxx9639	The Bank of New York Mellon		—			—		—		—
xxxxxxx0989	Bank of America		95,859,548			—		—		95,859,548

		$	101,140,911		$	—	$	84,522	$	101,056,389	(3)

(1)	The term “cash” as used herein includes all forms of currency (e.g., checks, cash, money orders, etc.)

(2)	Accumulated beginning cash balance is the cash available at the commencement of the case. Current month beginning cash balance equals the previous month’s ending balance.

(3)	Current Month, Accumulated, and Book cash balances are the same.

(4)	TMST, Inc. did not receive a more recent statement. Thus, the December 2011 statement is included in Exhibit A.

Page 2 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH DISBURSEMENTS DETAIL		Account No: xxxxxxx2822
*(attach additional sheets as necessary)*


Date	Check No.	Payee	Description (Purpose)	Amount
2/1/2012	7558	LexisNexis	Information Services	$	31,156
2/1/2012	7559	TMST Employee	Expense reimbursement		786
2/1/2012	7560	Susman Godfrey LLP	Professional services		1,547
2/1/2012	7561	FrontBridge Technologies, Inc.	Microsoft Exchange Hosted Services		2,575
2/1/2012	7562	CenturyLink	Information Services		119
2/1/2012	7563	Epiq Bankruptcy Solutions, LLC	Professional services		2,653
2/1/2012	7564	First Interstate Plaza	Office Lease_Rent		190
2/1/2012	7565	LexisNexis	Information Services		6,043
2/1/2012	7566	LexisNexis	Information Services		1,193
2/8/2012	WIRE	ADP Inc.	Payroll — Direct deposits		20,141
2/9/2012	WIRE	ADP, Inc.	Payroll taxes		11,571
2/21/2012	7567	Internal Revenue Service	IRS User Fee		10,000
2/22/2012	WIRE	ADP Inc.	Payroll — Direct deposits		19,436
2/23/2012	7568	American Stock Transfer & Trust	Transfer Agent		1,054
2/23/2012	7569	FedEX	Shipping		222
2/23/2012	7570	AT&T TeleConferenceServices	TeleConference Service		13
2/23/2012	7571	TMST Employee	Expense reimbursement		1,399
2/23/2012	7572	Iron Mountain Information Management	Document Storage		846
2/23/2012	7573	RR Donnelley Receivables, Inc	EDGAR Filings		925
2/23/2012	7574	Crystal Springs	Office Supplies		36
2/23/2012	7575	TBConsulting	Contract Services		46,900
2/23/2012	7576	tw telecom	Information Services		1,261
2/23/2012	7577	First Interstate Plaza	Office Lease_Rent		5,527
2/23/2012	7578	Long, Pound & Komer, P.A.	Professional services		15,000
2/23/2012	WIRE	ADP, Inc.	Payroll taxes		10,734
2/28/2012	WIRE	Quinn Emanuel Urquhart Oliver & Hedges LLP	Professional services		19,932
2/28/2012	WIRE	Tydings & Rosenberg LLP	Professional services		3,795
2/28/2012	WIRE	Goldin Associates, LLC	Professional services		180,677
2/28/2012	WIRE	Shapiro Sher Guinot & Sandler	Professional services		284,645

			Total Cash Disbursements	$	680,376	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 3 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx2822
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
2/17/2012	AON Risk Services	Workers Compensation	$	167
2/27/2012	Wells Fargo Bank	Reinvestment Income		23
2/27/2012	US Bank	Credit Risk Advisor Fee		553
2/27/2012	Wells Fargo Bank	Credit Risk Advisor Fee		280
2/27/2012	Wells Fargo Bank	Credit Risk Advisor Fee		702

		Total Cash Receipts	$	1,725	(1)

(1)	Total for all accounts should agree with total cash receipts listed on Form 2-B, page 2

Page 4 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx0805
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
		Total Cash Receipts	$	0	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 5 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx1807
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
2/29/2012	New Mexico Bank & Trust	Interest Paid	$	0

		Total Cash Receipts	$	0	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 6 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH DISBURSEMENTS DETAIL		Account No: xxxxxxx2954
*(attach additional sheets as necessary)*


Date	Check No.		Payee	Description (Purpose)	Amount
2/23/2012		15574	MIDCON Data Services LLC	Document Storage	$	2,065
2/23/2012		15575	Pepper Hamilton LLP	Professional services		581

				Total Cash Disbursements	$	2,646	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 7 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx2954
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
2/17/2012	State of Mississippi	Tax Refund	$	23

		Total Cash Receipts	$	23	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 8 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH DISBURSEMENTS DETAIL		Account No: xxxxxxx2989
*(attach additional sheets as necessary)*


Date	Check No.	Payee	Description (Purpose)	Amount
2/3/2012	ACH	ADP Financial Services	Payroll processing	$	95
2/17/2012	ACH	ADP Financial Services	Payroll processing		95
2/23/2012	ACH	ADP Financial Services	Payroll processing		221
2/24/2012	ACH	ADP Financial Services	Payroll processing		42

			Total Cash Disbursements	$	453	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 9 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx5856
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
		Total Cash Receipts	$	0	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 10 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH DISBURSEMENTS DETAIL		Account No: xxxxxxx2842
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
		Total Cash Receipts	$	0	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 11 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS AND DISBURSEMENTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH DISBURSEMENTS DETAIL		Account No: xxxxxxx0989
*(attach additional sheets as necessary)*


Date	Check No.	Payee	Description (Purpose)	Amount
2/29/2012	Bank of America		Bank and Technology Service Fee	$	5,000

			Total Cash Disbursements	$	5,000	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 12 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-B

CASH RECEIPTS STATEMENT

For Period: 2/1/2012 to 2/29/2012


CASH RECEIPTS DETAIL		Account No: xxxxxxx0989
*(attach additional sheets as necessary)*


Date	Payor	Description (Purpose)	Amount
		Total Cash Receipts	$	0	(1)

(1)	Total for all accounts should agree with total cash disbursements listed on Form 2-B, page 2

Page 13 of 19


DEBTOR:		TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO:		09-17787

Form 2-C

COMPARATIVE BALANCE SHEET

For Period Ended: February 29, 2012


		Current Month			Petition Date (1)
*ASSETS*
Current Assets:
Cash and Cash Equivalents (from Form 2-B)		$	101,056,389		$	16,848,967
Accounts Receivable (from Form 2-E)			995,653			9,403,326
Receivable from Officers, Employees, Affiliates (2)			—			—
Inventory			—			—
Other Current Assets (List):	Prepaid expenses & retainers		1,042,130			4,807,453
	Accrued interest receivable		—			47,878

Total Current Assets			103,094,172			31,107,624

Fixed Assets:
Land			—			—
Building			—			—
Equipment, Furniture and Fixtures			1,201,340			1,201,340

Total Fixed Assets			1,201,340			1,201,340

Less: Accumulated Depreciation			1,201,340			533,109

Net Fixed Assets			—			668,231

Other Assets (List):	Restricted cash		—			201,432,689
	Mortgage servicing portfolio		—			87,104,385
	Investment in subsidiaries (3)		(6,000,000	)		21,244,747
	Loan held for sale		1,985,230			8,359,404
	Deposits		3,605,000			300,000

TOTAL ASSETS		$	102,684,402		$	350,217,080

*LIABILITIES*
Post-petition Accounts Payable (from Form 2-E)		$	653,273		$	—
Post-petition Accrued Professional Fees (from Form 2-E)			4,209,446			—
Post-petition Taxes Payable (from Form 2-E)			—			—
Post-petition Notes Payable			—			—
Other Post-petition Payable(List):	Contingent obligations (4)		3,296,287			—

Total Post Petition Liabilities			8,159,005			—

Pre Petition Liabilities:
Secured Debt			—			—
Unsecured Debt (3)			3,421,750,874			3,664,898,118

Total Pre Petition Liabilities			3,421,750,874			3,664,898,118

TOTAL LIABILITIES			3,429,909,879			3,664,898,118

*OWNERS’ EQUITY*
Owner’s/Stockholder’s Equity			3,640,741,359			3,640,741,359
Retained Earnings—Prepetition			(6,955,422,396	)		(6,955,422,396	)
Retained Earnings—Post-petition (5)			(12,544,440	)		—

TOTAL OWNERS’ EQUITY			(3,327,225,477	)		(3,314,681,037	)

TOTAL LIABILITIES AND OWNERS’ EQUITY		$	102,684,402		$	350,217,080

(1)	Petition date values are taken from the Debtors’ balance sheet as of the petition date or are the values listed on the Debtors’ schedules.

(2)

TMST, Inc. has requested reimbursement from SAF for damages incurred. No receivable has been recorded. On February 13, 2012, the Trustee filed a motion with The Bankruptcy Court seeking approval of a settlement of all claims asserted against SAF Financial, Inc., Orrick, Herrington & Sutcliffe LLP, Thornburg Mortgage Advisory Corporation and other individual defendants. The impact of that settlement will be reflected in subsequent Monthly Operating Reports, upon its approval by The Bankruptcy Court.

(3)	On March 15, 2010 the Second Amended Chapter 11 Plan of Reorganization for ADFITECH, Inc. became effective. TMST Home Loans interests were deemed cancelled on the Effective Date and Senior Notes Guarantee Claims against TMST, Inc. were reduced by $38.6 million under the plan.

Pre-petition unsecured debt includes a $1.1 billion fair value adjustment for Senior Subordinated Secured Notes recorded under GAAP. Total pre-petition liabilities prior to the fair value adjustment is $4,542,124,192.

(4)	Includes cash payments received that will require bankruptcy court ruling to resolve ownership issues.

(5)	Post-petition Retained Earning includes a loss of $4.2 million related to 2009, income of $3 million related to 2010 and a loss of $10.2 million related to 2011.

Rev. 4/2008

Page 14 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-D

PROFIT AND LOSS STATEMENT

For Period From: February 1, 2012 to February 29, 2012


	Current Month			Post-petition Accumulated Total (1)
Operating Revenue
Interest income (2)	$	—		$	5,637,681
Mortgage servicing income		1,558			21,842,344

Net Operating Revenue		1,558			27,480,025

Total interest expense / (benefit) (3)		—			(1,195,076	)

Gross Profit		1,558			28,675,101

Operating Expenses
Officer Compensation		—			895,390
Selling, General and Administrative		88,016			28,440,552
Rents and Leases		5,527			965,873
Depreciation, Depletion and Amortization		—			668,240
Other (list):		—			—
		—			—

Total Operating Expenses		93,543			30,970,055

Operating Income / (Loss)		(91,985	)		(2,294,954	)

Non-Operating Income / (Expenses)
Earnings from subsidiaries		—			3,368,902
Other Non-Operating Income (4)		—			13,692,097

Net Non-Operating Income / (Expenses)		—			17,060,999

Reorganization Expenses
Legal and Professional Fees		384,403			26,902,136
Other Reorganization Expense		15,798			703,202

Total Reorganization Expenses		400,201			27,605,338

Net Income / (Loss) Before Income Taxes		(492,186	)		(12,839,293	)

Federal and State Income Tax Expense / (Benefit) (5)		—			(294,853	)

NET INCOME / (LOSS)	$	(492,186	)	$	(12,544,440	)

(1)	Accumulated Totals include all revenue and expenses since the petition date.

(2)	Accumulated total includes approximately $4.5 million of $20.2 million in certain Owner Trust residual interest distributions that may require bankruptcy court ruling to resolve ownership issues. To be conservative, the Company has not recorded a $15.7 million receivable or the related income.

(3)	Accumulated total reflects amortization of derivatives.

(4)

Accumulated total includes an approximately $1 million settlement from Bank of America, $8 million gain on the reorganization of Adfitech, Inc., a $3.9 million gain on the servicing portfolio, a $3.3 million loss incurred on the whole loan liquidation and a $3.9 million gain on cancellation of auction swaps agreements by CSFB and RBS as reported in each entity’s respective bankruptcy claim filings.

(5)

In early January 2010, the Trustee signed a Consent Agreement with the Internal Revenue Service to change TMST, Inc.’s method of accounting related to the reporting of taxable income associated with REMIC regular interests. Due to the large 2009 operating losses for TMST, Inc. no tax liability was incurred.

For tax year 2010, the Trustee was advised TMST, Inc. no longer qualified as a REIT and filed a consolidated return. Due to prior net operating losses, no tax liability is anticipated in 2010.

Rev. 4/2008

Page 15 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-E

SUPPORTING SCHEDULES

For Period: February 1, 2012 to February 29, 2012

POST PETITION TAXES PAYABLE SCHEDULE


	Beginning Balance		Amount Accrued		Amount Paid		Date Paid		Check Number		Ending Balance
Income Tax Withheld
Federal	$	—	$	6,093	$	6,093		2/9/2012		Wire	$	—
				5,621		5,621		2/23/2012		Wire		—
State		—		1,263		1,263		2/9/2012		Wire		—
				1,199		1,199		2/23/2012		Wire		—

FICA Tax Withheld		—		1,647		1,647		2/9/2012		Wire		—
				1,572		1,572		2/23/2012		Wire		—
Employer’s FICA Tax		—		2,229		2,229		2/9/2012		Wire		—
				2,130		2,130		2/23/2012		Wire		—
Unemployment Tax
Federal		—		—		—						—
				—		—
						—
State		—		339		339		2/9/2012		Wire		—
				213		213		2/23/2012		Wire
						—						—

Sales, Use & Excise Taxes		—		—		—						—
Property Taxes		—		—		—						—
Accrued Income Tax
Federal		—		—		—						—
State		—		—		—

TOTALS	$	—	$	22,306	$	22,306					$	—

INSURANCE SCHEDULE

Carrier

Amount of
Coverage

Expiration
Date

Premiums
Paid
Through

Workers’ Compensation

The Cincinnati Insurance Co.

1,000,000/incident

7/1/2012

General Liability

The Cincinnati Insurance Co.

1,000,000/incident

8/11/2012

Property (Fire, Theft) (1)

N/A

Vehicle (1)

N/A

Directors & Officers (Excess)

N/A

Directors & Officers (Primary)

N/A

Trustee Surety Bond

Liberty Mutual Insurance Company

120,000,000

10/28/2012

(1)	Commercial Property and Vehicle coverage are included in the General Liability Commercial Package policy.

Rev. 4/2008

Page 16 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-E

SUPPORTING SCHEDULES

For Period: 2/1/2012 to 2/29/2012

ACCOUNTS RECEIVABLE AND POST PETITION PAYABLE AGING


Due	Accounts Receivable (1)			Post Petition Accounts Payable (2)
Under 30 days	$	100,000		$	1,016,149
30 to 60 days		—			516,586
61 to 90 days		—			—
91 to 120 days		—			193,957
Over 120 days		492,676			3,136,027
Unavailable		283,719	(3)

Total Post Petition		876,395

Pre Petition Amounts		119,258	(3)

Total Accounts Receivable		995,653
Less: Bad Debt Reserve		—

Net Accounts Receivable(to Form 2-C)	$	995,653

		Total Post Petition
		Accounts Payable		$	4,862,718

(1)	See Exhibit B for Accounts Receivable Aging

(2)	See Exhibit C for Accounts Payable Aging

(3)	Receivable amounts include balances due from multiple mortgage loan holders. Aging of the balances due is not available.

SCHEDULE OF PAYMENTS TO ATTORNEYS AND OTHER PROFESSIONALS


	Month-end Retainer Balance		Current Month’s Accrual		Paid in Current Month		Date of Court Approval	Month-end Balance Due * (1)
Debtor’s Counsel (2)	$	—	$	—	$	—		$	—
Debtor’s Special Counsel (3)		310,304		—		—			449,718
Debtor’s Financial Advisor		—		—		—			191
Creditors’ Committee’s Counsel		100,000		30,000		23,727			137,118
Unsecured Creditors’ Financial Advisor		—		—		—			7,150
Chapter 11 Trustee (4)		—		75,000		—			2,100,000
Trustee’s Counsel		—		160,000		284,645			783,692
Trustee’s Financial Advisor		—		190,000		180,677			672,728
Trustee’s Tax Advisor (5)		—		—		—			49,793
Trustee’s Consultant						—
Claims Agent		—		4,000		2,653			9,057

Total	$	410,304	$	459,000	$	491,702		$	4,209,446

*	Balance due to include fees and expenses incurred but not yet paid.

(1)	Includes estimates for amounts that may be due to professionals for which an invoice for services had not been received.

(2)	Retainer Balance, net of outstanding fees, was returned to TMST, Inc. on August 3, 2010

(3)	Orrick, Herrington & Sutcliffe LLP is no longer Debtors’ Special Counsel. The current balance due is the subject of an adversary proceeding filed against Orrick, Herrington & Sutcliffe LLP and other related parties.

On February 13, 2012, the Trustee filed a motion with The Bankruptcy Court seeking approval of a settlement of all claims asserted against SAF Financial, Inc., Orrick, Herrington & Sutcliffe LLP, Thornburg Mortgage Advisory Corporation and other individual defendants. The impact of that settlement will be reflected in subsequent Monthly Operating Reports, upon its approval by The Bankruptcy Court.

(4)	Chapter 11 Trustee commission is an estimate based on time spent performing the Trustee function at customary rates. The actual commission awarded is subject to Bankruptcy Court approval and will vary from the estimate.

(5)

The Chapter 11 Trustee was authorized to retain KPMG LLP to provide tax compliance and consulting services on May 26, 2010 pursuant to their February 26, 2010 engagement letter. Payments for services rendered prior to February 28, 2010 are reported pursuant to the Ordinary Course Professional Compensation Procedures.

Rev. 4/2008

Page 17 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-E

SUPPORTING SCHEDULES

For Period: 2/1/2012 to 2/29/2012

SCHEDULE OF PAYMENTS AND TRANSFERS TO PRINCIPALS/EXECUTIVES**


Payee Name	Position	Nature of Payment	Amount
N/A

**	List payments and transfers of any kind and in any form made to or for the benefit of any proprietor, owner, partner, shareholder, officer or director.

Rev. 4/2008

Page 18 of 19


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Form 2-F

DISBURSEMENT SUMMARY

For the Month Ended: February 29, 2012

QUARTERLY DISBURSEMENT CALCULATION


	TMST, Inc., et al.
1. Disbursements made in calendar quarter
January 2012	$	1,468,260
February 2012		688,476
March 2012

Quarterly Total	$	2,156,736

FEE SCHEDULE


Quarterly Disbursements	Fee		Quarterly Disbursements	Fee
$0 to $14,999	$	325	$1,000,000 to $1,999,999	$	6,500
$15,000 to $74,999	$	650	$2,000,000 to $2,999,999	$	9,750
$75,000 to $149,999	$	975	$3,000,000 to $4,999,999	$	10,400
$150,000 to $224,999	$	1,625	$5,000,000 to $14,999,999	$	13,000
$225,000 to $299,999	$	1,950	$15,000,000 to $29,999,999	$	20,000
$300,000 to $999,999	$	4,875	$30,000,000 or more

Interest will be assessed on Chapter 11 quarterly fees not paid by the end of the month following the end of the calander quarter pursuant to 31 U.S.C. Sec. 3717. The interest rate assessed is the rate in effect as determined by the Treasury Department at the time the account becomes past due.

Failure to pay the quarterly fee is cause for conversion or dismissal of the chapter 11 case. [11 U.S.C. Sec. 1112(b)(10)]

Page 19 of 19

Exhibit B

TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.

Accounts Receivable

As of February 29, 2012


Post Petition		Date		Amount		Under 30 days		30 to 60 days		61 to 90 days		91 to 120 days		Over 120 days		Unavailable
Reimbursement Simmons_FedEx (1)			8/7/2009		98		—		—		—		—		98		—
Reimbursement Simmons_FedEx (1)			8/14/2009		49		—		—		—		—		49		—
Reimbursement Simmons_FedEx (1)			9/11/2009		47		—		—		—		—		47		—
Thornburg Mortgage Advisory Co			10/15/2009		492,482		—		—		—		—		492,482		—
Big Tree, Inc.			2/21/2012		100,000		100,000		—		—		—		—		—
Borrower Escrow Advance Balance	(2)		Various		272,828		—		—		—		—		—		272,828
Borrower Corporate Advance Balance	(2)		Various		10,828		—		—		—		—		—		10,828
Borrower Inspection Fees	(2)		Various		63		—		—		—		—		—		63

Total Post Petition Accounts Receivable				$	876,395	$	100,000	$	—	$	—	$	—	$	492,676	$	283,719


Pre Petition			Date		Amount
Borrower Escrow Advance Balance	(2	)		Various		119,108
Borrower Inspection Fees	(2	)		Various		150

Total Pre Petition Accounts Receivable					$	119,258

(1)	Employee expenses appear to have been for personal matters.

(2)	Receivable amounts include balances due from multiple mortgage loan holders. Aging of the balances due is not available.

Page 1 of 1

Exhibit C

TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.

Post Petition Accounts Payable

As of February 29, 2012


Vendor	Date		Amount		Under 30 days		30 to 60 days		61 to 90 days		91 to 120 days		Over 120 days
Thornburg Mortgage Advisory Co		05/15/09		40,290		—		—		—		—		40,290
Orrick,Herrington & Sutcliffe LLP		05/31/09		21,469		—		—		—		—		21,469
Orrick,Herrington & Sutcliffe LLP		06/30/09		19,410		—		—		—		—		19,410
Orrick,Herrington & Sutcliffe LLP		07/31/09		127,078		—		—		—		—		127,078
Thornburg Mortgage Advisory Co		07/31/09		37,518		—		—		—		—		37,518
Orrick,Herrington & Sutcliffe LLP		08/31/09		281,761		—		—		—		—		281,761
Thornburg Mortgage Advisory Co		09/30/09		8,400		—		—		—		—		8,400
Thornburg Mortgage Advisory Co		10/15/09		29,657		—		—		—		—		29,657
Thornburg Mortgage Advisory Co		10/31/09		6,460		—		—		—		—		6,460
Thornburg Mortgage Advisory Co		11/15/09		28,453		—		—		—		—		28,453
Chapter 11 Trustee_Joel I. Sher		11/30/09		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		11/30/09		5,024		—		—		—		—		5,024
Thornburg Mortgage Advisory Co		12/15/09		1,875		—		—		—		—		1,875
Chapter 11 Trustee_Joel I. Sher		12/31/09		75,000		—		—		—		—		75,000
Quinn Emanuel Urquhart Oliver & Hedges		12/31/09		60,000		—		—		—		—		60,000
Thornburg Mortgage Advisory Co		12/31/09		29,989		—		—		—		—		29,989
Thornburg Mortgage Advisory Co		01/15/10		26,875		—		—		—		—		26,875
Chapter 11 Trustee_Joel I. Sher		01/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		01/31/10		4,450		—		—		—		—		4,450
Thornburg Mortgage Advisory Co		02/12/10		26,875		—		—		—		—		26,875
Chapter 11 Trustee_Joel I. Sher		02/28/10		75,000		—		—		—		—		75,000
Protiviti Inc.		02/28/10		191		—		—		—		—		191
Thornburg Mortgage Advisory Co		02/28/10		1,893		—		—		—		—		1,893
Chapter 11 Trustee_Joel I. Sher		03/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		03/31/10		31,325		—		—		—		—		31,325
Chapter 11 Trustee_Joel I. Sher		04/30/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		04/30/10		31,325		—		—		—		—		31,325
Chapter 11 Trustee_Joel I. Sher		05/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		05/31/10		31,325		—		—		—		—		31,325
Chapter 11 Trustee_Joel I. Sher		06/30/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		06/30/10		27,575		—		—		—		—		27,575
Chapter 11 Trustee_Joel I. Sher		07/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		07/31/10		27,575		—		—		—		—		27,575
Chapter 11 Trustee_Joel I. Sher		08/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		08/31/10		27,575		—		—		—		—		27,575
Chapter 11 Trustee_Joel I. Sher		09/30/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		09/30/10		25,000		—		—		—		—		25,000
Chapter 11 Trustee_Joel I. Sher		10/31/10		75,000		—		—		—		—		75,000

Page 1 of 3

TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.

Post Petition Accounts Payable

As of February 29, 2012


Vendor	Date		Amount		Under 30 days		30 to 60 days		61 to 90 days		91 to 120 days		Over 120 days
Thornburg Mortgage Advisory Co		10/31/10		25,000		—		—		—		—		25,000
Chapter 11 Trustee_Joel I. Sher		11/30/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		11/30/10		25,000		—		—		—		—		25,000
Chapter 11 Trustee_Joel I. Sher		12/31/10		75,000		—		—		—		—		75,000
Thornburg Mortgage Advisory Co		12/31/10		25,000		—		—		—		—		25,000
Chapter 11 Trustee_Joel I. Sher		01/31/11		75,000		—		—		—		—		75,000
J.H. Cohn LLP		01/31/11		3,749		—		—		—		—		3,749
Thornburg Mortgage Advisory Co		01/31/11		25,000		—		—		—		—		25,000
Chapter 11 Trustee_Joel I. Sher		02/28/11		75,000		—		—		—		—		75,000
Chapter 11 Trustee_Joel I. Sher		03/31/11		75,000		—		—		—		—		75,000
J.H. Cohn LLP		03/31/11		1,737		—		—		—		—		1,737
Chapter 11 Trustee_Joel I. Sher		04/30/11		75,000		—		—		—		—		75,000
Chapter 11 Trustee_Joel I. Sher		05/31/11		75,000		—		—		—		—		75,000
J.H. Cohn LLP		05/31/11		1,664		—		—		—		—		1,664
KPMG LLP		05/31/11		3,253		—		—		—		—		3,253
Chapter 11 Trustee_Joel I. Sher		06/30/11		75,000		—		—		—		—		75,000
KPMG LLP		06/30/11		7,990		—		—		—		—		7,990
Chapter 11 Trustee_Joel I. Sher		07/31/11		75,000		—		—		—		—		75,000
KPMG LLP		07/31/11		2,020		—		—		—		—		2,020
Chapter 11 Trustee_Joel I. Sher		08/31/11		75,000		—		—		—		—		75,000
Broadstreet Capital Partners, LP		08/31/11		2,415		—		—		—		—		2,415
Chapter 11 Trustee_Joel I. Sher		09/30/11		75,000		—		—		—		—		75,000
Goldin Associates, LLC		09/30/11		40,822		—		—		—		—		40,822
Quinn Emanuel Urquhart Oliver & Hedges		09/30/11		3,402		—		—		—		—		3,402
Shapiro Sher Guinot & Sandler		09/30/11		71,103		—		—		—		—		71,103
Tydings & Rosenberg LLP		09/30/11		2,480		—		—		—		—		2,480
Chapter 11 Trustee_Joel I. Sher		10/31/11		75,000		—		—		—		—		75,000
Goldin Associates, LLC		10/31/11		41,864		—		—		—		—		41,864
KPMG LLP		10/31/11		13,970		—		—		—		—		13,970
Quinn Emanuel Urquhart Oliver & Hedges		10/31/11		3,151		—		—		—		—		3,151
Shapiro Sher Guinot & Sandler		10/31/11		76,206		—		—		—		—		76,206
Tydings & Rosenberg LLP		10/31/11		836		—		—		—		—		836
Chapter 11 Trustee_Joel I. Sher		11/30/11		75,000		—		—		—		75,000		—
Goldin Associates, LLC		11/30/11		44,300		—		—		—		44,300		—
Quinn Emanuel Urquhart Oliver & Hedges		11/30/11		4,797		—		—		—		4,797		—
Shapiro Sher Guinot & Sandler		11/30/11		68,970		—		—		—		68,970		—
Tydings & Rosenberg LLP		11/30/11		890		—		—		—		890		—
Chapter 11 Trustee_Joel I. Sher		12/31/11		75,000		—		75,000		—		—		—
Goldin Associates, LLC		12/31/11		167,418		—		167,418		—		—		—

Page 2 of 3

TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.

Post Petition Accounts Payable

As of February 29, 2012


Vendor	Date		Amount		Under 30 days		30 to 60 days		61 to 90 days		91 to 120 days		Over 120 days
Quinn Emanuel Urquhart Oliver & Hedges		12/31/11		23,787		—		23,787		—		—		—
Shapiro Sher Guinot & Sandler		12/31/11		247,475		—		247,475		—		—		—
Tydings & Rosenberg LLP		12/31/11		2,906		—		2,906		—		—		—
Chapter 11 Trustee_Joel I. Sher		01/31/12		75,000		75,000		—		—		—		—
Epiq Bankruptcy Solutions, LLC		01/31/12		5,057		5,057		—		—		—		—
Goldin Associates, LLC		01/31/12		188,324		188,324		—		—		—		—
KPMG LLP		01/31/12		22,561		22,561		—		—		—		—
Shapiro Sher Guinot & Sandler		01/31/12		159,938		159,938		—		—		—		—
Tydings & Rosenberg LLP		01/31/12		4,870		4,870		—		—		—		—
CenturyLink		02/22/12		119		119		—		—		—		—
FrontBridge Technologies, Inc.		02/22/12		2,575		2,575		—		—		—		—
Fed Ex		02/24/12		240		240		—		—		—		—
Chapter 11 Trustee_Joel I. Sher		02/29/12		75,000		75,000		—		—		—		—
Epiq Bankruptcy Solutions, LLC		02/29/12		4,000		4,000		—		—		—		—
Goldin Associates, LLC		02/29/12		190,000		190,000		—		—		—		—
Quinn Emanuel Urquhart Oliver & Hedges		02/29/12		25,000		25,000		—		—		—		—
Shapiro Sher Guinot & Sandler		02/29/12		160,000		160,000		—		—		—		—
Tydings & Rosenberg LLP		02/29/12		5,000		5,000		—		—		—		—
Hotel Santa Fe		02/29/12		798		798		—		—		—		—
Iron Mountain Information Management		02/29/12		621		621		—		—		—		—
State of Utah		02/29/12		134		134		—		—		—		—
TBConsulting		02/29/12		49,805		49,805		—		—		—		—
TMST Employee		02/29/12		3,018		3,018		—		—		—		—
Walsh,Anderson,Brown,Aldridge & Gallegos, P.C.		02/29/12		88		88		—		—		—		—
Payroll Accrual		02/29/12		44,000		44,000		—		—		—		—

Post Petition Accounts Payable				4,862,718		1,016,149		516,586		—		193,957		3,136,027

NOTE:

Includes estimates for amounts that may be due to professionals for which an invoice for services had not been received. Amounts asserted by vendors may be subject to adjustments and bankruptcy court approval.

Page 3 of 3


DEBTOR: TMST, Inc. f/k/a Thornburg Mortgage, Inc., et al.		CASE NO: 09-17787

Exhibit D

For Period Ending February 29, 2012

EXPLANATORY STATEMENT

RESERVATION OF RIGHTS AND GLOBAL FOOTNOTES

FOR MONTHLY OPERATING REPORT

The Trustee reserve all rights to dispute the amount, allowance, priority, treatment and/or secured or other status of any and all claims against the Debtors or their estates referred to herein. The Trustee reserve the right to (a) amend and supplement this Monthly Operating Report from time to time, and (b) assert any and all potential claims and causes of action of the Debtors’ estates regardless of whether such claim or cause of action is identified herein.

Any values presented are not and should not be deemed to be an admission, representation or waiver with respect to the actual value of any asset or amount of any liability or claim. The actual realizable value and/or fair market value of assets, liabilities and claims may differ significantly from the values presented.

The Trustee prepared this Monthly Operating Report with the assistance of his financial advisor, Goldin Associates, LLC (“Goldin”), based upon the information available to date. This Monthly Operating Report does not purport to present financial statements in accordance with Generally Accepted Accounting Principles, and the information contained herein has not been subjected to audit or review by Goldin or any other party on behalf of the Trustee.

This Explanatory Statement, Reservation of Rights and Global Footnotes is hereby incorporated by reference into, and comprises an integral part of, the Debtors’ Monthly Operating Report and should be referred to and considered in connection with any review of the report.

Page 1 of 1

THIS REPORT IS DUE 20 DAYS AFTER THE END OF THE MONTH

Debtor must attach each of the following reports/documents unless the U. S. Trustee

Mark One Box for Each Required Document:

has waived the requirement in writing. File the original with the Clerk of Court.

Submit a duplicate, with original signature, to the U. S. Trustee.