Assignee's Report of Events as of December 31, 2020

In the Notice of Assignment (the “Notice”) for the Benefit of Creditors Relating to FSM Company 1A, LLC f/d/b/a The Printing Source (“TPS”), I indicated that I would provide periodic reports of the events concerning the liquidation of the assets of TPS. As I indicated in the Notice, the primary assets of TPS included real property located at 2373 Ball Drive, St. Louis, Missouri (“Real Property”), a contingent receivable payable by Garlich Press (the “Garlich Receivable”), which acquired a substantial portion of the assets of TPS, and a restricted financial account pledged to Enterprise Bank by an affiliate of TPS in the amount of about $754,000 (the “Restricted Account”). At the time of my appointment, the primary liabilities of TPS included a secured debt to Enterprise Bank of about $3,185,000, a sales tax obligation of about $100,000 to the State of Missouri and the general unsecured debt of TPS of approximately $2,000,000.

 

Since my appointment as Assignee, the Restricted Account was liquidated and used to pay a portion of the debt of Enterprise Bank. At the present time, the amount of the secured debt of Enterprise Bank is approximately $2,400,000, which secured debt encumbers the Real Property. I have continued to market the Real Property with a listing price of $3,250,000. While there have been various prospective purchasers interested in acquiring the Real Property, there are no existing contracts for sale. I intend to continue marketing the Real Property in the first quarter of 2021. I had hoped to sell the Real Property in 2020, but it is my belief that the uncertainty in the commercial real estate market in St. Louis due to Covid-19 has slowed the process. In the meantime, I have been required to continue paying secured loan payments to Enterprise Bank of almost $20,000 per month. I have also been required to maintain the Real Property and pay such expenses, as utilities, real property taxes in excess of $63,000 and nominal maintenance.

 

In addition to the payments relating to the Real Property, I am also paying monthly installments for the delinquent sales tax in the approximate amount of $3,000 per month and paying other general costs of administration of this assignment, such as fees.

 

The sources of funds for the payment of these ongoing debt payments, tax payments and administrative costs have come from the existing funds in the bank account of TPS at the time of assignment, the receipt of monthly payments with regard to the Garlich Receivable, the sale of an old box truck, and from monies borrowed from an affiliate of TPS, as the funds have not been sufficient to pay the ongoing obligations. Had the Real Property sold in 2020 as had been anticipated as of my appointment as Assignee, the need to borrow funds would not have existed. With regard to the borrowing of the funds, I entered into a First Amendment to Trust Agreement for the Benefit of Creditors of FSM Company 1A, LLC f/d/b/a The Printing Source, a copy of which is also posted on the website.

 

From the date of my appointment as Assignee through December 31, 2020, receipts have totaled $222,878.26, which has included loans to the Assignee, and disbursements have totaled $221,030.25, leaving a nominal balance in the estate of about $1,800 at year’s end. As a result, there will be a need for borrowing additional funds in order to continue marketing the Real Property and paying other administrative claims.

 

As stated, the goal is to (a) sell the Real Property, which will result in the payoff of the Enterprise Bank and affiliate loans, and (b) continue to collect the monthly Garlich Receivable, which contractually continues for almost 3 years, so as to allow for payment of a modest dividend to unsecured creditors. The modest dividend is dependent upon the price for and timing of the sale of Real Property and the monthly collection of sufficient sums from the Garlich Receivable in addition to unforeseen circumstances beyond my control as Assignee.

 

Previously, the Notice included an Exhibit that contained a balance sheet of the assets and liabilities of TPS as of the time of the Assignment. I include an updated balance sheet with this report.

 

If there are any questions about this report, you may contact me as listed below. Further reports will be posted on the website from time to time as events unfold.

 

David A. Sosne, Assignee
8909 Ladue Road
St. Louis, Missouri
(314) 991-4999
dsosne@summerscomptonwells.com

 

Christina L. Hauck, Assistant to Assignee
chauck@summerscomptonwells.com

 

Updated Ledge as of Decemenber 31, 2020
Asset Estimate Value
Real Property located at 2373 Ball Drive, St. Louis, Missouri 63146 $3,250,000.00 (Listing price; value to be determined by actual sale price).
Garlich Press Receivable (Contingent) Amount to be collected is unknown due to many variables; monthly payments for approximately 3 years depending on sales and collections
Checking Account $1,800.00
Funds allocated for Administrative Expenses held by Assignee for fees of Assignee and his attorneys $4,500.00

 

Liabilities1 Estimated Value
Enterprise Bank (secured) $2,400,000 plus interest and fees Approximately $2,000,000.00
General unsecured debt Approximately $2,000,000
Anticipated Adminstrative expenses for Assignee and professionals Unknown but estimated at $30,000.00 (amount may vary)
$4,500 held as security initially for certain Administrative Expenses
Missouri Sales Tax Approximately $88,000.00 $63,500.00
Loan from FSM Affiliate $63,500.00
1 The IRS has also asserted a claim, but it is believed that the IRS claim will be fully resolved with no further payment.