SEAL123 INC - FORM 8-K - EX-99.1

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EX-99.2 - EX-99.2 - SEAL123 INC	d935549dex992.htm

Exhibit 99.1

UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re Seal123, Inc. et al

Case No. 15-10081 (CSS)

Reporting Period: 3/1/2015 to 3/31/2015

MONTHLY OPERATING REPORT

File with Court and submit copy to United States Trustee before the end of the following month.

Submit copy of report to any official committee appointed in the case.


REQUIRED DOCUMENTS	Form No.	Document Attached	Explanation Attached	Affidavit/Supplement Attached
Schedule of Cash Receipts and Disbursements	MOR-1	x
Schedule of Bank Accounts with Book Balances	MOR-1a	x
Bank Reconciliation (or copies of debtor’s bank reconciliations)	MOR-1b		x
Schedule of Professional Fees Paid	MOR-1c	x
Copies of bank statements
Cash disbursements journals
Statement of Operations	MOR-2	x
Balance Sheet	MOR-3	x
Status of Postpetition Taxes	MOR-4	x
Copies of IRS Form 6123 or payment receipt
Copies of tax returns filed during reporting period
Summary of Unpaid Postpetition Debts	MOR-4	x
Listing of aged accounts payable	MOR-4	x
Debtor Questionnaire	MOR-5	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.


Signature of Debtor				Date

Signature of Joint Debtor				Date

				April 28, 2015
Signature of Authorized Individual*				Date

Bill Langsdorf				Chief Executive Officer
Printed Name of Authorized Individual				Title of Authorized Individual

*	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.

In re Seal123, Inc. et al

Case No. 15-10081 (CSS)

Reporting Period: 3/1/2015 to 3/31/2015

SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

FOR THE PERIOD MARCH 1 to MARCH 31, 2015

In re Seal123, Inc. et al

MOR -1


	WS Inc.			WS Retail		WS Catalog		WS Gift card		Total company
Cash Receipts
Cash and checks		—			6,085		—		—		6,085
Credit card		—			10,474		2,719		—		13,193
Other		2,589			—		—		—		2,589

Total receipts		2,589			16,559		2,719		—		21,867

Cash Disbursements
Advertising		100			—		98		—		198
Benefits/Medical		208			38		1		—		247
Freight out		303			61		105		—		469
Merchandise		—			9,167		1,492		—		10,659
Other		497			522		77		—		1,096
Payroll		1,028			2,090		60		—		3,178
Rent		86			3,811		—		—		3,897
Sales tax		—			725		39		—		764
Temp help		46			138		117		—		301

Total disbursements		2,267			16,553		1,989		—		20,809



Net Operating Cash Flow		321			6		731		—		1,058

Non-operating Professional Fees		413			—		—		—		413
Capital Expenditure		39			—		—		—		39

Total Non-operating disbursements		452			—		—		—		452

Net Cash Flow		(131	)		6		731		—		606

Disbursements for calculating US Trustee Quarterly Fees:

Total disbursements		2,719			16,553		1,989		—		21,261



US Trustee Fees*		3			15		4		—		22

*	US Trustee fees reflected in the table above are subject to change as disbursements by debtor reflect only one month of the quarter.

In re Seal123, Inc. et al

Case No. 15-10081 (CSS)

Reporting Period: 3/1/2015 to 3/31/2015

Schedule of Bank Accounts with Book Balances

In re Seal123, Inc. et al


Bank Account	CONSOLIDATED			WS INC(Co 01)		WS RETAlL(Co 02)			WS INTERNET(Co 03)		WS GC(Co 04)
11101 Cash On Hand		109			2		107			—		—
11201 Cash - B of A Main (0086)		5,313			—		5,313			—		—
11202 Cash - B of A A/P Expense Checks		(214	)		—		(214	)		—		—
11203 Cash - B of A A/P Merch Checks		(210	)		—		(210	)		—		—
11204 Cash - B of A A/P Expense (Retail)		(2,912	)		—		(2,912	)		—		—
11209 Cash - B of A (6096)		97			—		97			—		—
11211 American Express		230			—		230			—		—
11212 American Express - Internet		8			—		—			8		—
11213 Debit Card		791			—		791			—		—
11214 Cash - Wet Seal Inc Concentration (6128)		462			—		462			—		—
11217 M/C & Visa		662			—		662			—		—
11218 M/C & Visa - Internet		81			—		—			81		—
11219 Discover		38			—		38			—		—
11220 Discover - Internet		4			—		—			4		—
11221 Amazon Pay Phrase		6			—		—			6		—
11222 Amazon Retail		1			—		—			1		—
11223 ECA Checks		3			—		3			—		—
11224 Cash - BofA Payroll-WS1 “Retail”		73			—		73			—		—
11225 Cash - BofA Payroll-WS2 “Inc”		21			—		21			—		—
11227 Cash - Wells Fargo (2375)		130			—		130			—		—
11228 Cash - UMB (9215)		5			—		5			—		—
11229 Cash - Bank Of Hawaii (7696)		7			—		7			—		—
11230 Cash - ADP Refund Payroll Checks		(1	)		—		(1	)		—		—
11235 Cash - B of A (5505)		60			—		60			—		—
11240 Cash - Capital One (3024)		19			—		19			—		—
11241 Cash - Tri Counties Bank (4372)		1			—		1			—		—
11242 Cash - MB Financial (3400)		8			—		8			—		—
11245 Cash - IBC Bank (4224)		30			—		30			—		—
11261 Cash - Compass (3082)		14			—		14			—		—
11268 Cash - Wells Fargo (7711)		15			—		15			—		—
11270 Cash - First Citizens (7493)		7			—		7			—		—
11271 Cash - PNC (3713)		17			—		17			—		—
11273 Cash - BofA - Nations (5143)		180			—		180			—		—
11278 Cash - Citibank - Cigna Dental		5			—		5			—		—
11280 Cash - PayPal		27			—		—			27		—
11282 Cash - M & T /Wilmington (2422)		15			—		15			—		—
11286 Cash - Citibank (4202)		9			—		9			—		—
11288 Cash - Wheatland Bank (2722)		4			—		4			—		—
11294 Cash - American Savings (1847)		3			—		3			—		—
11298 Cash - Prosperity Bank (3019)		3			—		3			—		—
11305 Cash - B of A Flex Ben (3869)		3			—		3			—		—
11306 Cash - B of A LC (5600)		14			—		14			—		—
11307 Cash - B of A Utility Assurance		102			—		102			—		—
11403 Cash - Commerce (1282)		9			—		9			—		—
11404 Cash - CoreFirst Bank (1670)		4			—		4			—		—
11412 Cash - Banco Popular (2034)		5			—		5			—		—
11440 Cash - JPM Chase (5732)		61			—		61			—		—
11477 Cash - Citibank (9462)		9			—		9			—		—
11487 Cash - US Bank (6180)		48			—		48			—		—
11495 Cash - Comerica (5247)		12			—		12			—		—
11538 Cash - First Sentry (2195)		5			—		5			—		—
11570 Cash - Plains Commerce (3268)		4			—		4			—		—
11571 Cash - PNC (5029)		24			—		24			—		—
11573 Cash - Huntington National (0721)		4			—		4			—		—
11577 Cash - 5/3 Bank (4021)		7			—		7			—		—
11581 Cash - Key Bank (7205)		12			—		12			—		—
11599 Cash - BMO Harris (9030)		1			—		1			—		—
11605 Cash - Sovereign (6840)		10			—		10			—		—
11606 Cash - Sovereign (7956)		17			—		17			—		—
11607 Cash - B of A - La Salle (5141)		23			—		23			—		—
11609 Cash - Citizens (2501)		14			—		14			—		—
11635 Cash - Suntrust (7978)		26			—		26			—		—
11651 Cash - BofA Inv (Cash/Cash Eq)		2,332			—		2,332			—		—
11652 Cash - UBS Money Market		100			—		100			—		—
11664 Cash - Salem Five (1098)		4			—		4			—		—
11669 Cash - First American (4601)		1			—		1			—		—
11675 Cash - Bank Financial (3903)		6			—		6			—		—
11687 Cash - Valley National Bank (9151)		6			—		6			—		—

		7,990			2		7,860			128		—

In re Seal123, Inc. et al

Case No. 15-10081 (CSS)

Reporting Period: 3/1/2015 to 3/31/2015

Declaration Regarding the Status of Bank Reconciliations of the Debtors

In re Seal123, Inc. et al

I am the Chief Executive Officer for Seal123, Inc. et al, the above-captioned debtors and debtors in possession (collectively, the “Debtors”). I am familiar with the Debtors’ day-to-day operations, business affairs and books and records.

All statements in the Declaration are based on my personal knowledge, my review of the relevant documents, my discussions with other employees of the Debtors, or my opinion based upon my experience and knowledge of the Debtors’ operations and financial condition. If I were called upon to testify. I could and would testify to each of these facts set forth herein based on such personal knowledge, review of documents or opinion. I am authorized to submit this Declaration on behalf of the Debtors.

To the best of my knowledge, all of the Debtors’ bank balances as of March 31, 2015 have been reconciled in an accurate and timely manner.

In re Seal123, Inc. et al

Case No. 15-10081 (CSS)

Reporting Period: 3/1/2015 to 3/31/2015

In re Seal123, Inc. et al

SCHEDULE OF PROFESSIONAL FEES AND EXPENSES PAID

This schedule is to include all retained professional payments from case inception to current month.


Payee	Period Covered	Amount Approved		Payor	Check		Amount Paid				Year-To-Date
Payee	Period Covered	Amount Approved		Payor	Number	Date	Fees		Expenses		Fees		Expenses
Donlin, Recano & Company, Inc.	1/15/15 - 1/31/15		225	The Wet Seal, Inc.	563729	2/19/2015		176		49		176		49
Klee, Tuchin, Bogdanoff & Stern, LLP	1/15/15 - 1/31/15		234	The Wet Seal, Inc.	15026	3/27/2015		220		14		220		14
Paul Hastings, LLP	1/15/15 - 1/31/15		64	The Wet Seal, Inc.	15027	3/27/2015		64		0		64		0
Young, Conaway, Stargatt & Taylor, LLP	1/15/15 - 1/31/15		60	The Wet Seal, Inc.	15029	3/27/2015		55		5		55		5
Womble, Carlyle, Sandridge & Rice, LLP	1/15/15 - 2/28/15		14	The Wet Seal, Inc.	15085	3/31/2015		14		0		14		0
FreedMaxick	1/28/15 - 2/5/15		39	The Wet Seal, Inc.	14973	3/17/2015		29		10		29		10


In re Seal123, Inc. *et al*		Case No. 15-10081 (CSS)
MOR - 2		Reporting Period: 3/1/2015 to 3/31/2015
Debtor Income Statement-By Entity
For the Month Ended March 31, 2015
In re Seal123, Inc. *et al*


				01			02		03			04
	*CONSOLIDATED*			WS INC(Co 01)			WS RETAIL(Co 02)		WS INTERNET(Co 03)			WS GC(Co 04)
*Unaudited*	*Actual*			*Actual*			*Actual*		*Actual*			*Actual*
Sales		19,147			—			16,443		2,704			—

Cost of Sales		8,112			—			6,785		1,327			—
Buying		233			237			—		(4	)		—
Planning/Allocation		76			76			—		—			—
Warehouse		450			—			450		—			—
Occupancy		4,578			—			4,578		—			—

Total Cost of Sales		13,449			313			11,813		1,323			—

Gross Profit (Loss)		5,698			(313	)		4,630		1,381			—

Gross Profit (Retail)		11,035			—			9,658		1,377			—

S,G & A
Selling-Store Expense		3,701			—			3,107		588			6
Selling-Field Support		271			—			271		—			—
Gen & Admin Expense		2,728			2,581			16		130			1

Total S,G&A Expenses		6,700			2,581			3,395		718			6

Operating (Loss) Income		(1,002	)		(2,895	)		1,235		663			(6	)

Interest Exp. Net		(10	)		(10	)		—		—			—


(Loss) Inc Cont Ops Before Tax		(1,012	)		(2,905	)		1,235		663			(6	)

Inc Tax Provision		—			—			—		—			—


(Loss) Inc from Cont Ops		(1,012	)		(2,905	)		1,235		663			(6	)

Net Inc(Loss) Disc Ops		—			—			—		—			—

Net (Loss) Inc		(1,012	)		(2,905	)		1,235		663			(6	)


In re Seal123, Inc. *et al*				Case No. 15-10081 (CSS)
MOR - 3				Reporting Period: 3/1/2015 to 3/31/2015
Balance Sheet-By Entity-Condensed
March, 2015
In re Seal123, Inc. *et al*


				01			02			03			04
	*CONSOLIDATED* *Actual*			WS INC(Co 01) *Actual*			WS RETAIL(Co 02) *Actual*			WS INTERNET(Co 03) *Actual*			WS GC(Co 04) *Actual*
Assets

Current Assets:
Cash And Cash Equivalents		7,990			2			7,860			128			—
Other Receivables		6,278			4,880			1,365			24			9
Merchandise Inventories		14,147			—			12,223			1,924			—
Prepaid Expenses		6,751			3,313			3,439			—			—


Total Current Assets		35,166			8,194			24,887			2,076			9


Equipment And Leasehold Improvements:
Leasehold Improvements		24,173			2,813			21,342			18			—
Furniture, Fixtures And Equipment		40,706			21,859			15,622			3,225			—
Construction In Progress		209			9			180			20			—
Less Accumulated Depreciation		(45,271	)		(19,609	)		(23,378	)		(2,285	)		—


Net Equipment And Leasehold Improvements		19,816			5,072			13,766			977			—


Other Assets:
Other Assets		1,944			1,727			214			2			—


Total Other Assets		1,944			1,727			214			2			—


Total Assets		56,926			14,994			38,868			3,055			9


Liabilities And Stockholders’ (Deficit) Equity

Current Liabilities:
Accounts Payable-Merchandise
Subject to compromise		6,432			—			4,304			2,127			—
Not subject to compromise		796			—			642			154			—
Accounts Payable
Subject to compromise		4,368			468			3,550			349			—
Not subject to compromise		7,510			3,898			3,223			384			5
Accrued Liabilities
Subject to compromise		3,029			27			3,002			—			—
Not subject to compromise		13,347			1,194			8,807			547			2,799
Current Debt		2,500			2,500			—			—			—
Notes/Warrants/Derivatives		28,915			28,915			—			—			—
Unamortized Debt Discount		(3,564	)		(3,564	)		—			—			—
Short-Term Deferred Rent		12,301			731			11,570			—			—
Intercompany AP/AR - NET		—			177,181			(116,045	)		(70,032	)		8,896


Total Current Liabilities		75,633			211,350			(80,946	)		(66,471	)		11,700


Total Liabilities		75,633			211,350			(80,946	)		(66,471	)		11,700


Stockholders’ (Deficit) Equity:
Common Stock		8,459			8,459			—			—			—
Paid-In Capital		218,819			218,819			—			—			—
Retained Earnings		(240,698	)		(417,017	)		119,196			68,795			(11,672	)
Current Period Earnings		(5,231	)		(6,561	)		618			731			(19	)
Less Cost Of Treasury Stock		(56	)		(56	)		—			—			—


Total Stockholders’ (Deficit) Equity		(18,707	)		(196,356	)		119,814			69,526			(11,691	)


Total Liabilities And Stockholders’ Equity		56,926			14,994			38,868			3,055			9


In re Seal123, Inc. *et al*				Case No. 15-10081 (CSS)
				Reporting Period: 3/1/2015 to 3/31/2015


		STATUS OF POSTPETITION TAXES
In re Seal123, Inc. et al		(In thousands)


In re Seal123, Inc. *et al*
	Beginning Tax Liability		Amount Withheld or Accrued		Amount Paid		Ending Tax Liability
Federal
Withholding		—		95		95		—
FICA-Employee		—		60		60		—
FICA-Employer		—		60		60		—

Total Federal Taxes		—		215		215		—

State and Local
Withholding				27		27		—
Sales		65		1,496		707		854
Unemployment				9		9		—
Income		31						31
Personal Property		35		35				70

Total State and Local		131		1,567		743		955

Total Taxes		131		1,782		958		955

SUMMARY OF UNPAID POSTPETITION DEBTS


In re Seal123, Inc. *et al*
	Number of Days Past Due
	Current		0-30		31-60		61-90		Over 90		Total
Accounts Payable		1,818		—		—		—		—		1,818
Wages Payable		1,514		—		—		—		—		1,514
Taxes Payable		955		—		—		—		—		955
Rent/Leases-Building		—		—		2,145		—		—		2,145
Professional Fees		1,996		—		—		—		—		1,996

Total Postpetition Debts		6,283		—		2,145		—		—		8,428


In re Seal123, Inc. *et al*				Case No. 15-10081 (CSS)
				Reporting Period: 3/1/2015 to 3/31/2015

In re Seal123, Inc. et al

DEBTOR QUESTIONNAIRE


Must be completed each month		Yes	No
1.	Have any assets been sold or transferred outside the normal course of business this reporting period? If yes, provide an explanation below.		X

2.	Have any funds been disbursed from any account other than a debtor in possession account this reporting period? If yes, provide an explanation below.		X

3.	Have all postpetition tax returns been timely filed? If no, provide an explanation below.	X

4.	Are workers compensation, general liability and other necessary insurance coverages in effect? If no, provide an explanation below.	X

5.	Has any bank account been opened during the reporting period? If yes, provide documentation identifying the opened account(s). If an investment account has been opened provide the required documentation pursuant to the Delaware Local Rule 4001-3.		X

Dated April 28, 2015

Respectfully submitted,

Bill Langsdorf

Title: Chief Executive Officer