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8-K - FORM 8-K - DENDREON CORPd841999d8k.htm
EX-99.2 - EX-99.2 - DENDREON CORPd841999dex992.htm
EX-99.3 - EX-99.3 - DENDREON CORPd841999dex993.htm

Exhibit 99.1

 

THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

 

- - - - - - - - - - - - - - - - - - - - - - - - - - -  - - - - - -   x     
  :     
In re:   :       Chapter 11
  :     
DENDREON CORPORATION, et al.,   :       Case No. 14-12515 (PJW)
  :     
                                    Debtors.1   :       Jointly Administered
  :     
  :     
- - - - - - - - - - - - - - - - - - - - - - - - - - -  - - - - - -   x     

NOTICE OF FILING OF DEBTORS’ MONTHLY OPERATING REPORT

FOR THE PERIOD OF NOVEMBER 2014

PLEASE TAKE NOTICE that the above-captioned debtors and debtors in possession (collectively, the “Debtors”) have filed with the United States Bankruptcy Court for the District of Delaware the Debtors’ Monthly Operating Report for the Period of November 2014,

 

 

 

 

 

1  The Debtors and the last four digits of their respective taxpayer identification numbers are as follows: Dendreon Corporation (3193), Dendreon Holdings, LLC (8047), Dendreon Distribution, LLC (8598) and Dendreon Manufacturing, LLC (7123). The address of the Debtors’ corporate headquarters is 1301 2nd Avenue, Seattle, Washington 98101.


attached hereto as Exhibit A (the “Monthly Operating Report”).

 

Dated:   Wilmington, Delaware
  December 24, 2014

 

 

SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP      

/s/ Sarah E. Pierce

Anthony W. Clark (I.D. No. 2051)
Sarah E. Pierce (I.D. No. 4648)
One Rodney Square
P.O. Box 636
Wilmington, Delaware 19899-0636
Telephone: (302) 651-3000
Fax: (302) 651-3001
- and -
Kenneth S. Ziman
Raquelle L. Kaye
Four Times Square
New York, New York 10036-6522
Telephone: (212) 735-3000
Fax: (212) 735-2000
- and -
Felicia Gerber Perlman
155 N. Wacker Drive
Chicago, Illinois 60606-1720
Telephone: (312) 407-0700
Fax: (312) 407-0411
Counsel for Debtors and Debtors in Possession

 

2


EXHIBIT A

MONTHLY OPERATING REPORT


UNITED STATES BANKRUPTCY COURT

                     DISTRICT OF   DELAWARE

 

In re DENDREON CORPORATION, et. al    Case No.     14-12515 (PJW)                    
   Reporting Period:    November 2014                

MONTHLY OPERATING REPORT

File with Court and submit copy to United States Trustee within 20 days after end of 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          

 Bank Reconciliation (or copies of debtor’s bank reconciliations)

  MOR-1a   X          

 Schedule of Professional Fees Paid

  MOR-1b       X      

 Copies of bank statements

          X      

 Cash disbursements journals

          X      

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          

Accounts Receivable Reconciliation and Aging

  MOR-5   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  
      

 /s/ Gregory R. Cox

    

  December 23, 2014

 
Signature of Authorized Individual*      Date  

 Gregory R. Cox

      Interim Chief Financial 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.

 

MOR

(04/07)


 

 NOTES

Notes to the MOR:

This Monthly Operating Report (“MOR”) has been prepared solely for the purpose of complying with the monthly reporting requirements applicable in the Bankruptcy Case and is in a format acceptable to the U.S. Trustee. The financial information contained herein is limited in scope and covers a limited time period. Moreover, such information is preliminary and unaudited, and is not prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States. Accordingly, this MOR should not be used for investment purposes.

The financial statements presented in MOR-2 and MOR-3 are prepared on a consolidated company basis for the Debtors and non-debtor affiliates.

 

Page 2 of 13


 

1. SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS

($ 000s)

 

For the period 11/10/14 - 11/28/141                  Dendreon           Dendreon           Dendreon     Dendreon  
        Consolidated                      Corporation             Holdings             Distribution             Manufacturing      
 

Beginning Cash Balance2

  $ 92,248            $ 92,248      $ -      $ -      $ -   
 

Total Cash Receipts

    15,654              138        -        15,516        -   
 

Total Cash Disbursements

    (6,950           (6,950     -        -        -   
 

Intercompany Transfer From / (To) Other Debtors

    -              15,516        -        (15,516     -   
 

Intercompany Transfer From / (To) Non-Debtors

    -              -        -        -        -   
 
 

 

 

         

 

 

   

 

 

   

 

 

   

 

 

 

Net Cash Flow

  $ 8,704            $ 8,704      $ -      $ -      $ -   
 
 

 

 

         

 

 

   

 

 

   

 

 

   

 

 

 

Ending Cash Balance2

  $ 100,952            $ 100,952      $ -      $ -      $ -   

Notes:

 

1. 11/28 represents last day of Debtors’ November weekly cash forecast
2. Excludes restricted cash accounts
3. Cash Disbursements include amounts that were disbursed by Dendreon Corporation through its centralized cash management system for the benefit of subsidiary debtors. Accordingly, revised disbursement amounts (for the purposes of calculating US Trustee fees) are as follows:
 Debtor           Amounts            

 Dendreon Corporation

  4,682    

 Dendreon Holdings

  -        

 Dendreon Distribution

  938    

 Dendreon Manufacturing

  1,330    
 

 

 
  6,950    

 

Page 3 of 13


 

1a. BANK RECONCILIATION (OR COPIES OF DEBTORS’ BANK RECONCILIATIONS)

As of 11/30/14

                      Restricted Cash Accounts  
Bank   U.S. Bank     Morgan Stanley
Smith Barney
    U.S. Bank1     U.S. Bank     Wells Fargo  
Description         Operating Account           Investment Account               Payroll Account             Escrow Account                     LC Account  

Bank Balance

  $ 21,848,934      $ 79,350,237      $ 100,000      $ 214,380      $ 5,205,920   

(+) Deposits in Transit

    -        -        -        -        -   

(-) Outstanding Checks

    (347,096     -        -        -        -   

Other

    -        -        -        -        -   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Book Balance

  $ 21,501,837      $ 79,350,237      $ 100,000      $ 214,380      $ 5,205,920   

 

Notes:

 

1. Account opened during postpetition period

 

Page 4 of 13


 

 1b. SCHEDULE OF PROFESSIONAL FEES PAID

 

For the period 11/10/14 - 11/30/14, no payments were made to retained professionals

 

Page 5 of 13


 

 1c. COPIES OF BANK STATEMENTS

 

The Debtors’ bank statements are voluminous and not included herein, but copies will be provided upon request

 

Page 6 of 13


 

 1d. CASH DISBURSEMENTS JOURNALS

 

The Debtors’ cash disbursement journals are voluminous and not included herein, but copies will be provided upon request

 

Page 7 of 13


 

 2. STATEMENT OF OPERATIONS

($ 000s)

 

For the period 11/1/14 - 11/30/14         Consolidated1                Dendreon     
     Corporation     
         Dendreon     
     Holdings     
          Dendreon     
     Distribution     
        Dendreon    
    Manufacturing    
 
   

Product Revenue, net

   $ 21,968       $ 21,968      $ -       $ -      $ -   

Royalty and Other Revenue

     -         -        -         -        -   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

Total Revenue

  

 

$

 

21,968

 

  

  

 

$

 

21,968

 

  

 

 

$

 

-

 

  

  

 

$

 

-

 

  

 

 

$

 

-

 

  

   

Operating Expenses:

              

Cost Of Product Revenue

     10,849         10,849        -         -        -   

Inventory Impairment / (Recovery)

     (14,434      (14,434     -         -        -   

Research and Development

     2,924         2,924        -         -        -   

Selling, General and Administrative

     11,486         11,486        -         -        -   

Less: Payroll Expense Included In Categories Above2

     (9,350      (9,350     -         -        -   

Payroll Expense2,3

     9,350         2,841        -         2,750        3,759   

Restructuring

     1,179         1,179        -         -        -   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

Total Operating Expenses

  

 

$

 

12,005

 

  

  

 

$

 

5,496

 

  

 

 

$

 

-

 

  

  

 

$

 

2,750

 

  

 

 

$

 

3,759

 

  

   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

Income / (Loss) from Operations

  

 

$

 

9,964

 

  

  

 

$

 

16,473

 

  

 

 

$

 

-

 

  

  

 

$

 

(2,750

 

 

 

$

 

(3,759

 

   

Other Income / (Expense):

              

Interest Income

     17         17        -         -        -   

Interest Expense

     (1,580      (1,580     -         -        -   

Other Income / (Expense)

     4         4        -         -        -   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

Net Income / (Loss)

  

 

$

 

8,405

 

  

  

 

$

 

14,914

 

  

 

 

$

 

-

 

  

  

 

$

 

(2,750

 

 

 

$

 

(3,759

 

Notes:

 

1. The Debtors maintain their accounting records and prepare financial statements on a consolidated basis only. This modified presentation reflects cash basis payroll of the subsidiary entities, which is funded by Dendreon Corp.

2. The Debtors’ consolidated statement of operations reflects an allocation of payroll expenses among several operating expense categories (i.e., Cost of Product Revenue, R&D and SG&A). For the purpose of presenting payroll by entity without double-counting of such expenses, the cash basis payroll must be deducted before being included separately

3. Payroll Expense (noted above) includes payroll, payroll taxes and 401(k). These amounts are funded to ADP via the US Bank Operating account. For taxation purposes, each legal entity pays separate state employment taxes for the states in which it operates

 

Page 8 of 13


 

 3. BALANCE SHEET

($ 000s)   
As of 11/30/14   
          Consolidated1       

Current Assets:

  

Cash and Cash Equivalents

   $ 78,332   

Short-Term Investments

     23,122   

Trade Accounts Receivable

     29,586   

Inventory

     63,809   

Prepaid Expenses and Other Current Assets

     29,645   
  

 

 

 

 

Total Current Assets

  

 

$

 

224,494

 

  

Property and Equipment, net

     104,034   

Long-Term Investments

     5,179   

Other Assets

     3,597   
  

 

 

 

 

Total Assets

  

 

$

 

337,304

 

  

Current Liabilities2:

  

Accounts Payable

   $ 2,442   

Accrued Liabilities

     24,002   

Accrued Compensation

     14,500   

Restructuring Liability

     4,880   

Current Portion of Capital Lease Obligations

     2,455   

Current Portion of Facility Lease Obligations

     692   
  

 

 

 

 

Total Current Liabilities

  

 

$

 

48,971

 

  

Long-Term Liabilities2:

  

Long-Term Accrued Liabilities

     5,766   

Capital Lease Obligations, Less Current Portion

     1,120   

Facility Lease Obligations, Less Current Portion

     9,429   
  

 

 

 

 

Total Long-Term Liabilities

  

 

$

 

16,315

 

  

Liabilities Subject to Compromise2:

  

Accounts Payable

     5,339   

Convertible Senior Notes due 2016, Net of Discount

     583,533   

Other2

     TBD   
  

 

 

 

 

Total Liabilities Subject to Compromise

  

 

$

 

588,872

 

  

  

 

 

 

Total Liabilities

   $ 654,158   

Stockholders’ Equity:

  

Common Stock

     155   

Additional Paid-In Capital

     2,005,460   

Accumulated Other Comprehensive Income

     9   

Accumulated Deficit

     (2,322,478
  

 

 

 

 

Total Stockholders’ Equity (Deficit)

   $ (316,854
  

 

 

 

Total Liabilities and Stockholders’ Equity

   $ 337,304   

 

Notes:

  

1. The Debtors maintain their accounting records and prepare financial statements on a consolidated basis only   

 

2. The Debtors are currently working with their independent auditor to determine the proper balance and reporting for Liabilities Subject to Compromise. Once determined, certain liabilities are likely to be reclassified from Current and Long-Term Liabilities to Liabilities Subject to Compromise

    

 

Page 9 of 13


 

 4. STATUS OF POSTPETITION TAXES

Other than the item noted below, all postpetition taxes were current as of 11/30/14 and paid in the ordinary course by the Debtors:

- On 11/17/14, the City of Seattle notified the Debtors of unpaid B&O (wholesaling) tax amounts of $2,058 and $1,464 for 2012 and 2013, respectively. The Debtors have reviewed the assessments provided by the City and plan to process for payment during December 2014

 

Page 10 of 13


 

 5. SUMMARY OF UNPAID POSTPETITION DEBTS

As of 11/30/14

 

          Days Outstanding  
               Total                           1 - 30                           31 - 60                          61 - 90                          91 +            

Postpetition Accounts Payable

   $ 2,442,032         $ 2,442,032         $       $       $   

 

Page 11 of 13


 

 6. ACCOUNTS RECEIVABLE RECONCILLIATION & AGEING

As of 11/30/14

 

          Days Outstanding  
              Total                         1 - 30                          31 - 60                          61 - 90                          91 +            

Gross Accounts Receivable

  $ 34,719,350        $ 28,374,342        $ 6,416,195        $ (25,860)        $ (45,327)    

Accounts Receivable Offset - Chargebacks

    (5,133,021)           
 

 

 

         

Net Accounts Receivable

  $ 29,586,329            

 

Page 12 of 13


 

 7. DEBTOR QUESTIONNAIRE

 

       

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  

Notes:

 

5. Post filing, the Debtors opened a separate payroll account with US Bank in order to issue physical payroll checks, as this service was no longer offered by ADP

 

Page 13 of 13