EX-99.1 3 dex991.txt MONTHLY OPERATING REPORT Exhibit 99.1 UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF CALIFORNIA In re: AB Liquidating Corp. Case No. 01-53685 ASW 2055 Gateway Place, Suite 400 -------------- San Jose, CA 95110 CHAPTER 11 MONTHLY OPERATING REPORT (GENERAL BUSINESS CASE) ----------------------------------------- SUMMARY OF FINANCIAL STATUS MONTH ENDED: 12/31/01 (1) PETITION DATE: 07/26/01 ------------ -------- 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 --

(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: 01/20/02 /s/ Daniel Scharre ---------------- --------------------------------------- Responsible Individual - Daniel Scharre BALANCE SHEET (General Business Case) For the Month Ended 12/31/01 ---------- Assets

NOTE: At the guidance of the US Trustee, AB Liquidating Corp., Debtor In Possession, is presenting its assets at cost value less accumulated depreciation, if any. In addition, Accounts Receivable, Inventory and Property Plant & Equipment are reflective of a provisional impairement write-down. (1) The Debtor ceased depreciating its fixed assets effective December 1, 200l. Liabilities and Equity (General Business Case) Liabilities From Schedules Post-Petition Current Liabilities 30 Salaries and Wages (including Contract Labor) ------------- 31 Payroll taxes ------------- 32 Real and personal property taxes ------------- 33 Income taxes ------------- 34 Sales taxes ------------- 35 Notes payable (short term) ------------- 36 Accounts payable (trade) A $ 23,925 ------------- 37 Real property lease arrearage ------------- 38 Personal property lease arrearage ------------- 39 Accrued professional fees (estimate only) $ 842,000 ------------- 40 Current portion of long-term post-petition debt (due within 12 months) ------------- 41 Other: _______________________________________ ------------- 42 ______________________________________________ ------------- 43 ______________________________________________ ------------- 44 Total Current Liabilities $ 865,925 ------------- 45 Long-Term Post-Petition Debt, Net of Current Portion ------------- 46 Total Post-Petition Liabilities $ 865,925 ------------- Pre-Petition Liabilities (allowed amount) 47 Secured claims F $ 0 ------------- 48 Priority unsecured claims F $ 159,165 ------------- 49 General unsecured claims F $ 28,213,777 ------------- 50 Total Pre-Petition Liabilities $ 28,372,942 ------------- 51 Total Liabilities $ 29,238,867 ------------- Equity (Deficit) 52 Retained Earnings/(Deficit) at time of filing $(131,091,067) ------------- 53 Capital Stock $ 3,777,628 ------------- 54 Additional paid-in capital $ 157,920,727 ------------- 55 Cumulative profit/(loss) since filing of case $ (25,361,710) ------------- 56 Post-petition contributions/(distributions) or (draws) $ 0 ------------- 57 ______________________________________________ ------------- 58 Market value adjustment $ 0 ------------- 59 Total Equity (Deficit) $ 5,245,578 ------------- 60 Total Liabilities and Equity (Deficit) $ 34,484,445 =============

AB Liquidating Corp. Debtor-In-Possession Footnotes to Balance Sheet December 2001 MOR NOTES: ----- Accounts Receivable -- All Accounts Receivable, totaling $272,878 in the ------------------- Debtor's books, were sold effective 11/2/2001. Property and Equipment -- The Debtor's Property and Equipment has been written ---------------------- down by $3,859,391 to reflect the sale of the Debtor's assets on 11/2/2001. Inventory -- All Inventory, totaling $3,562,945 in the Debtor's books, was sold --------- effective 11/2/2001. Note 1 -- Prepaid Expenses for the MOR period of December 2001 was $574,394. This amount represents Prepaid Insurance of $103K and Sales Tax Refunds (we are expecting) of $471K. SCHEDULES TO THE BALANCE SHEET (General Business Case) Schedule A Accounts Receivable and (Net) Payable

NOTE: ---- On November 2, 2001, substantially all of the Debtor's assets were sold. The Debtor's Property and Equipment has been written down by $3,859,391 to reflect the sale. The Debtor's remaining Property and Equipment include servers, routers, and software. Effective 12/01/01, the company ceased depreciation of these assets. Schedule E Aging of Post-Petition Taxes (As of End of the Current Reporting Period)

Schedule F Pre-Petition Liabilities

Schedule G Rental Income Information Not applicable to General Business Cases Schedule H Recapitulation of Funds Held at End of Month

Note 1: Attached are copies of bank statement(s) & reconciliation(s). ------ Note 2: The CD from Union Bank will be drawn down by $1 million with respect to ------ a Letter of Credit issued to a former landlord, and fees totaling $35.8K will be deducted by Union Bank from this account in January, 2002. Schedule E - Footnotes ---------------------- a) All post-petition taxes have been paid and we are now current. Schedule F - Footnotes ---------------------- a) Pre-petition claims are presented as best represented in AB Liquidating Corp.'s books and records. The 'claimed' and 'allowed' amounts of such claims have, in most cases, not yet been determined. Some claims included in 'general unsecured claims' are stated at their potential gross amounts owed, although the 'allowed' amount of these claims could face limitations - as stipulated by the U.S. Bankruptcy Code. b) AB Liquidating Corp. is in the process of completing its analysis of claims in this case and reserves the right to object to all claims scheduled or otherwise listed. c) A number of claims were scheduled with the Bankruptcy Court as contingent, unliquidated, or disputed. For many of these items, a value was undeterminable at the time scheduled with the Court and is currently undeterminable. As a result, these items are not included in the claim totals listed in Schedule F above. d) AB Liquidating Corp. has provided a value for contingent, unliquidated or disputed claims when information was available for a reasonable estimation. Included in estimated contingent claims as part of the 'general unsecured claims' above are the following: $2.5MM for a potential warranty claim with Comtech Telecommunications, $2MM for a contingent settlement agreement with Northrop Grumman, and $14.8MM relating to Solectron Corporation. e) 'Priority claims other than taxes' represents AB Liquidating Corp.'s best estimate as to those employee claims eligible for priority status. The Company is currently reviewing these amounts and will continue to make any necessary adjustments to the allocation between priority and non-priority status, if warranted. f) General unsecured claims includes approximately $132K in pre-petition taxes. AB Liquidating Corp. is attempting to identify which, if any, amounts owing to taxing authorities are eligible for priority status. g) AB Liquidating Corp. has rejected three real property leases during the post-petition period. The Company is currently in the process of estimating the potential damage claim, if any, afforded to the landlords of these properties as may be allowed under the U.S. Bankruptcy Code. No such estimate is included in the 'general unsecured claims' listed above. STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS Increase/(Decrease) in Cash and Cash Equivalents For the Month Ended 12/31/01 ---------

AB Liquidating Corp. Tax Statement December 1 to December 31, 2001

(1) ADP, our Payroll vendor remits taxes to the taxing authorities on our behalf, immediately after payroll is run. Confidential Page 1 December 2001 Tax Schedule G/L ACCOUNT: 11457 ACCOUNT ANALYSIS ACCOUNT NAME: 1233006345 B of A Solectron PREPARED BY: C Jones AS OF: Dec-01 December-01

Bank of America [LOGO] BANK OF AMERICA, N.A. Account Number 1233006345 P.O. BOX 27128 01 01 142 01 M0000 E# 0 CONCORD, CA 94520 Last Statement: NEW ACC0UNT This Statement: 12/31/2001 Customer Service l-800-262-2726 ADAPTIVE BROADBAND DIP 2055 GATEWAY PLACE SUITE 400 Page l of 1 SAN JOSE CA 95110 ANALYZED INTEREST CHECKING -------------------------------------------------------------------------------- Account Summary Information Statement Period 00/00/0000 - 12/31/2001 Statement Beginning Balance .00 Number of Deposits/Credits 2 Amount of Deposits/Credits 692,704.98 Number of Checks 0 Amount of Checks .00 Number of Other Debits 0 Amount of Other Debits .00 0 Statement Ending Balance 692,704.98 Number of Enclosures 0 Average Collected Balance 524,650.72 Number of Days in Cycle 33 Service Charge .00 Interest Information Amount of Interest Paid 166.02 Interest Paid Year-to-Date 166.02 Annual Percentage Yield Earned .35% Deposits and Credits -------------------------------------------------------------------------------- Date Customer Bank Posted Reference Amount Description Reference -------------------------------------------------------------------------------- xx 692,538.96 WIRE TYPE: BOOK IN DATE: 120701 TIME: 1420 PT 385200370065556 == TRN: 011207065556 0RIG: ADAPTIVE BROADBAND CORP-D ID: 1233936178 xx 166.02 Interest Paid == Daily Balances -------------------------------------------------------------------------------- Date Ledger Collected Balance Date Ledger Collected Balance Balance Balance -------------------------------------------------------------------------------- /00 .00 .00 12/31 692,704.98 692,704.98 /07 692,538.96 692,538.96 G/L ACCOUNT: 11930 ACCOUNT ANALYSIS ACCOUNT NAME: UBOC LC Restricted Cash PREPARED BY: Cassandra Jones AS OF: December-01

Union Bank of California ------------------------------------------------------------------------------------------------- TIME DEPOSIT/RETIREMENT ACCOUNT RECEIPT ------------------------------------------------------------------------------------------------- OFFICE OF ACCOUNT SANTA CLARA VALLEY COMM'L BANKING THIS RECEIPT IS NON-NEGOTIABLE --------------------------------------------------------------------------------------------------------------- NAME TYPE OF ACCOUNT ADAPTIVE BROADBAND CORPORATION NON-RENEWABLE FIXED MATURITY --------------------------------------------------------------------------------------------------------------- ACCOUNT NUMBER DEPOSIT DATE MATURITY DATE TERM INTEREST RATE/ANNUAL PERCENTAGE YIELD AMOUNT 6459018542 11/09/2001 12/10/2001 D031 01.75 01.77 $1393054.11 --------------------------------------------------------------------------------------------------------------- INTEREST DISPOSITION TRANSFER TO ACCOUNT NUMBER INTEREST PAYMENT CYCLE TRANSFER 6450148642 AT MATURITY ---------------------------------------------------------------------------------------------------------------

ADAPTIVE BROADBAND CORPORATION /s/ XXXXXXXXXX ----------------------- BANK REPRESENTATIVE 1143 BORREGAS AVE 800-898-6466 ----------------------- SUNNYVALE CA 94089 0000 PHONE NUMBER Please examine this receipt carefully and notify us immediately of any errors. [LOGO OF UNION BANK OF CALIFORNIA] SANTA CLARA VALLEY CORPORATE DEPOSIT 645 POST OFFICE BOX 24512 OAKLAND, CA 94623 IMPORTANT ACCOUNT NOTICE ADAPTIVE BROADBAND CORPORATION 1143 BORREGAS AVE DECEMBER 7, 2001 SUNNYVALE CA 94089 ACCOUNT NUMBER: 6459018542 -------------------------------------------------------------------------------- UNION BANK OF CALIFORNIA TIME DEPOSIT INTEREST PAYMENT NOTICE -------------------------------------------------------------------------------- ----------------- ---------------------------- --------------- ----------------- INTEREST PAYMENT INTEREST PAYMENT DEPOSITED PAYMENT DATE CURRENT BALANCE $2,099.26 TO ACCOUNT 6450148642 DEC. 10, 2001 $1,393,054.11 ----------------- ---------------------------- --------------- ----------------- INTEREST EARNED ON YOUR FIXED MATURITY TIME DEPOSIT ACCOUNT WILL BE DEPOSITED TO YOUR ACCOUNT 6450148642 ON DECEMBER 10, 2001. UNION BANK OF CALIFORNIA MAKES AVAILABLE A WIDE VARIETY OF INVESTMENT OPTIONS TO CHOOSE FROM: SAVINGS, TIME DEPOSITS AND SECURITIES, SUCH AS STOCKS, BONDS AND MUTUAL FUNDS. (SECURITIES ARE NOT BANK DEPOSITS AND ARE NOT COVERED BY FDIC INSURANCE.) IF YOU NEED ANY ADDITIONAL INFORMATION, PLEASE CALL YOUR ACCOUNT REPRESENTATIVE OR BANKING OFFICE AT 800-898-6466. THANK YOU FOR BANKING WITH UNION BANK OF CALIFORNIA. 3384 Peachtree Rd. N.E. [LOGO]Reliance Suite 900 TRUST COMPANY Atlanta, GA 30326 Account Statement ------------------------------------------- Statement Period 10/01/2001 through 12/31/2001 Account Number 150209526 ADAPTIVE BROADBAND CORPORATION [LOGO] Answers about your account ATTN: HARRIET L. PURVIANCE ---------------------------------- 1143 BORREGAS AVENUE . Account EDWARD JARVIS SUNNYVALE CA 94089 Administrator 404-965-7293 ---------------------------------- Account Title RELIANCE TRUST CO, TRUSTEE FBO ADAPTIVE BROADBAND CORPORATION SUPPLEMENTAL EXECUTIVE DEFERRAL COMPENSATION PLAN [LOGO] Important Information ---------------------------------- THE SCHEDULE OF INVESTMENTS SHOWS ASSETS HELD ON SETTLEMENT DATE. SECURITY PRICES ARE OBTAINED FROM THE MOST RELIABLE SOURCES AVAILABLE. SHOULD WE BE UNABLE TO OBTAIN A CURRENT MARKET PRICE FOR AN ASSET, THE BOOK OR CARRYING VALUE WILL BE USED AS THE MARKET VALUE. Account Summary -------------------------------------------------------------------------------- Account Activity Summary This Period Year to Date -------------- -------------- Beginning Market Value $3,903,630.46 $4,516,013.65 ASSETS PURCHASED/RECEIVED $ 63,903.58- $7,016,030.54- ASSETS SOLD/DISTRIBUTED $ 31,951.79 $2,925,152.96 MATURITIES/REDEMPTIONS $ 0.00 $ 0.00 CORPORATE ACTIONS $ 0.00 $ 0.00 NOTE PAYMENTS $ 0.00 $ 0.00 INCOME $ 26,123.06 $ 43.396.01 OTHER RECEIPTS $ 0.00 $4,050,690.27 DISBURSEMENTS $ 0.00 $ 0.00 FEES $ 0.00 $ 0.00 MISCELLANEOUS $ 0.00 $ 3,208.70- CHANGE IN MARKET VALUE $ 31,951.79 $ 586,260.13- --------------- -------------- Ending Market Value $3,929,753.52 $3,929,753.52 Income Summary This Period Year to Date --------------- -------------- DIVIDEND $ 26,123.06 $ 43,396.01 INTEREST $ 0.00 $ 0.00 --------------- -------------- TOTAL $ 26,123.06 $ 43,396.01 Your Investment Portfolio Profile ------------------------------------------------------------------------------- 100% CASH AND CASH EQUIVALENTS $3,929,753.52 ------------------------------------------------------------- 100% Total $3,929,753.52 Important Account Information: As a service to you, and in compliance with Georgia law, we invest any available cash in your account, awaiting investment or distribution, in a short-term money market mutual fund. We have elected to invest these monies in Valiant Fund General Money Market Portfolio Class E. For providing certain administrative or shareholder services to the Valiant Fund, Reliance will receive an administrative fee from the Valiant Fund of eighty one-hundredths of one percent (.80 of 1% = .008) per annum of the net assets invested. There will be no direct charge to you as a result of this arrangement. In order for Reliance to produce accurate annual reporting, all assets held within your IRA need to be valued annually. If this value cannot be obtained through Reliance's standard pricing resources, it will be the responsibility of the account owner to supply such values. The asset value will remain at the cost or book value of the investment until an updated price can be obtained. If an asset does not have a readily ascertainable market value and you do not provide us with valuation information, values reported by us to the Internal Revenue Service may be inaccurate and result in adverse tax consequences to the account owner. The market value of the assets listed on this statement cannot be relied upon as the current selling price of the asset. G/L ACCOUNT: 11925 ACCOUNT ANALYSIS ACCOUNT NAME: Investments - Merrill Lynch PREPARED BY: C Jones AS OF: December-01

[LOGO] Merrill Lynch Investment Managers Merrill Lynch Funds For Institutions P.O. Box 8118, Boston, MA 02266-8118 (800) 225-1576 ADAPTIVE BROADBAND ATTN ELIAS NADER 2055 GATEWAY PL STE 400 SAN JOSE CA 95110-1060 Merrill Lynch Premier Institutional Fund ------------------------------------------------ Cumulative Statement for 01/01/2001 - 12/31/2001 Account Number 318-3251209-0 Financial Advisor Edward S Kunkel (--29107023) Account Value As Of 12/3l/2001 $10,116,386.56 Dividends 01/01/2001 - 12/31/2001 Year To Date $687,306.53 $687,306.53 . MERRILL LYNCH FUNDS FOR INSTITUTIONS WILL BE CLOSED ON MONDAY, JANUARY 21 IN OBSERVANCE OF MARTIN LUTHER KING, JR. DAY. . THE AVERAGE NET ANNUALIZED YIELD FOR THE MONTH OF DECEMBER WAS 2.20%. THE TRADING DEADLINE ON JANUARY 18TH IS 3:00 P.M. ET. -------------------------------------------------------------------------------- Account Activity

-------------------------------------------------------------------------------- Account Number 318-3251209-0 (page 1 of 3) -------------------------------------------------------------------------------- [LOGO] Merrill Lynch Investment Managers Merrill Lynch Funds For Institutions Merrill Lynch Premier Institutional Fund -------------------------------------------------- Cumulative Statement for 01/01/2001 - 12/31/2001 Account Number 318-3251209-0 -------------------------------------------------------------------------------- Account Activity

-------------------------------------------------------------------------------- Account Number 318-3251209-0 (page 2 of 3) -------------------------------------------------------------------------------- [LOGO] Merrill Lynch Investment Merrill Lynch Funds For Institutions Managers Merrill Lynch Premier Institutional Fund ---------------------------------------- Cumulative Statement for 01/01/2001 - 12/31/2001 Account Number 318-3251209-0 -------------------------------------------------------------------------------- Account Activity

G/L ACCOUNT: 11456 ACCOUNT ANALYSIS ACCOUNT NAME: Corp Debtor in Possession PREPARED BY: CASSANDRA JONES AS OF: December-01

OCTOBER 2001 - AP Outstanding Checks

Bank of America [LOGO] LIQUIDITY MANAGEMENT ACCOUNT STATEMENT PERIOD: 12/01/2001-12/31/2001 ACCOUNT NUMBER 1233936178 MASTER ACCOUNT 1233936178 TAX ID. NUMBER 94-1668412 ADAPTIVE BROADBAND CORP-DIP 2055 GATEWAY PLACE SUITE 400 SAN JOSE CA 95110-0000

Bank of America [LOGO] ADAPTIVE BROADBAND CORP-DIP 2055 GATEWAY PLACE SUITE 400 SAN JOSE CA 95110-0000 CURRENT DATE: 12/31/2001 TREASURY MANAGEMENT SERVICES THIS IS A CREDIT ADVICE. WE HAVE CREDITED YOUR CHECKING ACCOUNT NUMBER 123-393-617-8 FOR $720.00 WITH PROCEEDS TAKEN FROM YOUR NATIONS CASH RESERVES FUND. YOUR INVESTED BALANCE IS: $16,051,480.36 Bank of America [LOGO] BANK OF AMERICA, N.A. Account Number 1233936178 P.O. BOX 27128 01 01 000 01 M0000 E# 37 CONCORD, CA 94520 Last Statement: 11/30/2001 This Statement: 12/30/2001 Customer Service 1-800-262-2726 ADAPTIVE BROADBAND CORP-DIP 2055 GATEWAY PLACE SUITE 400 Page 1 of 3 SAN JOSE CA 95110 ANALYZED CHECKING -------------------------------------------------------------------------------- Account Summary Information Statement Period 12/01/2001 - 12/31/2001 Statement Beginning Balance .00 Number of Deposits/Credits 16 Amount of Deposits/Credits 818,593.42 Number of Checks 37 Amount of Checks 54,987.71 Number of Other Debits 11 Amount of Other Debits 763,605.71 Statement Ending Balance .00 Number of Enclosures 37 Number of Days in Cycle 31 Service Charge 1,739.16

Bank of America [LOGO] BANK OF AMERICA, N.A. Account Number 1233936178 P.O. BOX 27128 01 01 000 M0000 E# 37 CONCORD, CA 94520 Last Statement: 11/30/2001 This Statement: 12/31/2001 Customer Service 1-800-262-2726 ADAPTIVE BROADBAND CORP-DIP Page 2 of 3

Bank of America [LOGO] BANK OF AMERICA, N.A. Account Number 1233936178 P.O. BOX 27128 01 01 000 01 M0000 E# 37 CONCORD, CA 94520 Last Statement: 11/30/2001 This Statement: 12/31/2001 Customer Service 1-800-262-2726 ADAPTIVE BROADBAND CORP-DIP Page 3 of 3 ANALYZED CHECKING -------------------------------------------------------------------------------- Daily Balances -------------------------------------------------------------------------------- Date Ledger Balance Collected Balance Date Ledger Balance Collected Balance -------------------------------------------------------------------------------- 11/30 .00 .00 12/19 16,434.69 .00 12/05 424.88 .00 12/21 986.08 .00 12/07 25.48 .00 12/24 .00 .00 12/10 .00 .00 12/31 .00 .00

AB LIQUIDATING CORP 8-K