DENDREON CORP - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - 8-K - DENDREON CORP	d855036d8k.htm

Exhibit 99.1

THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE


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

NOTICE OF FILING OF DEBTORS’ MONTHLY OPERATING REPORT

FOR THE PERIOD OF DECEMBER 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 December 2014,}

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

January 20, 2015

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

EXHIBIT A

MONTHLY OPERATING REPORT

UNITED STATES BANKRUPTCY COURT

DISTRICT OF DELAWARE


In re DENDREON CORPORATION, et. al	Case No. 14-12515_(LSS)
	Reporting Period:	December 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-5	X
Listing of aged accounts payable	MOR-5	X
Accounts Receivable Reconciliation and Aging	MOR-6	X
Debtor Questionnaire	MOR-7	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				January 20, 2014
Signature of Authorized Individual*
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.

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 11/29/14 - 1/2/15¹				Dendreon			Dendreon		Dendreon			Dendreon
	Consolidated			Corporation			Holdings		Distribution			Manufacturing

Beginning Cash Balance²	$	100,952		$	100,952		$	-	$	-		$	-

Total Cash Receipts		32,446			796			-		31,649			-

Total Cash Disbursements³		(17,683	)		(17,683	)		-		-			-

Intercompany Transfer From / (To) Other Debtors		-			31,649			-		(31,649	)		-

Intercompany Transfer From / (To) Non-Debtors		-			-			-		-			-


Net Cash Flow	$	14,762		$	14,762		$	-	$	-		$	-


Ending Cash Balance²	$	115,714		$	115,714		$	-	$	-		$	-

Notes:

1. 1/2/15 represents last day of Debtors’ December weekly cash forecast

2. Excludes restricted cash accounts

3. Cash Disbursements include payroll that was disbursed by Dendreon Corporation through its centralized cash management system for the benefit of subsidiary debtors. Accordingly, disbursement amounts (for the purposes of calculating US Trustee fees) are as follows:


Debtor	Amounts
Dendreon Corporation		13,278
Dendreon Holdings		-
Dendreon Distribution		1,864
Dendreon Manufacturing		2,541

	$	17,683

Page 3 of 13

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


As of 12/31/14
							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	$	36,942,055	$	79,569,680	$	87,255	$	214,380	$	5,206,211
(+) Deposits in Transit		-		-		-		-		-
(-) Outstanding Checks		(519,884)		-		(12,427)		-		-
Other		-		-		-		-		-


Book Balance	$	36,422,171	$	79,569,680	$	74,828	$	214,380	$	5,206,211

Notes:

1. Account opened during postpetition period

Page 4 of 13

1b. SCHEDULE OF PROFESSIONAL FEES PAID

For the period 12/1/14 - 12/31/14, 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 12/1/14 - 12/31/14	Consolidated¹			Dendreon Corporation			Dendreon Holdings		Dendreon Distribution			Dendreon Manufacturing

Product Revenue, net	$	28,765		$	28,765		$	-	$	-		$	-
Royalty and Other Revenue		12			12			-		-			-


Total Revenue	$	28,777		$	28,777		$	-	$	-		$	-

Operating Expenses:
Cost Of Product Revenue		12,478			12,478			-		-			-
Inventory Impairment / (Recovery)		-			-			-		-			-
Research and Development		4,979			4,979			-		-			-
Selling, General and Administrative		10,339			10,339			-		-			-
Less: Payroll Expense Included In Categories Above²		(5,836	)		(5,836	)		-		-			-
Payroll Expense^2,3		5,836			1,431			-		1,864			2,541
Restructuring		5,566			5,566			-		-			-


Total Operating Expenses	$	33,362		$	28,957		$	-	$	1,864		$	2,541


Income / (Loss) from Operations	$	(4,585	)	$	(180	)	$	-	$	(1,864	)	$	(2,541	)

Other Income / (Expense):
Interest Income		39			39			-		-			-
Interest Expense		(413	)		(413	)		-		-			-
Other Income / (Expense)		(1	)		(1	)		-		-			-


Net Income / (Loss)	$	(4,960	)	$	(555	)	$	-	$	(1,864	)	$	(2,541	)

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 12/31/14
	Consolidated¹
Current Assets:
Cash and Cash Equivalents		$	101,480
Short-Term Investments			15,080
Trade Accounts Receivable			27,649
Inventory			61,617
Prepaid Expenses and Other Current Assets			25,149


Total Current Assets		$	230,975

Property and Equipment, net			102,410
Long-Term Investments			5,179
Other Assets			4,219


Total Assets		$	342,783

Current Liabilities²:
Accounts Payable		$	6,275
Accrued Liabilities			25,334
Accrued Compensation			18,978
Restructuring Liability			6,932
Current Portion of Capital Lease Obligations			2,395
Current Portion of Facility Lease Obligations			699


Total Current Liabilities		$	60,614

Long-Term Liabilities²:
Long-Term Accrued Liabilities			5,794
Capital Lease Obligations, Less Current Portion			963
Facility Lease Obligations, Less Current Portion			9,362


Total Long-Term Liabilities		$	16,120

Liabilities Subject to Compromise²:
Accounts Payable			5,284
Convertible Senior Notes due 2016, Net of Discount			583,533
Other²			TBD


Total Liabilities Subject to Compromise		$	588,817


Total Liabilities		$	665,551

Stockholders’ Equity:
Common Stock			155
Additional Paid-In Capital			2,004,520
Accumulated Other Comprehensive Income			(2	)
Accumulated Deficit			(2,327,440	)


Total Stockholders’ Equity (Deficit)		$	(322,768	)


Total Liabilities and Stockholders’ Equity		$	342,783

Notes:

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

2. The Debtors are currently working 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

All postpetition taxes were current as of 12/31/14 and paid in the ordinary course by the Debtors

Page 10 of 13

5. SUMMARY OF UNPAID POSTPETITION DEBTS

As of 12/31/14


				Days Outstanding
	Total			1 - 30			31 - 60			61 - 90			91 +
Postpetition Accounts Payable		$	6,274,956		$	6,067,607		$	207,349		$	-		$	-

Page 11 of 13

6. ACCOUNTS RECEIVABLE RECONCILLIATION & AGEING

As of 12/31/14


					Days Outstanding
	Total				1 - 30			31 - 60			61 - 90			91 +
Gross Accounts Receivable		$	29,711,026			$	30,754,944		$	(1,120,789)		$	110,406		$	(33,535)

Accounts Receivable Offset - Chargebacks			(2,062,111	)

Net Accounts Receivable		$	27,648,915

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

Page 13 of 13

DENDREON CORP.

13-Week Cash Flow Forecast

(Dollars in Thousands)


	Actual			Projected																																			13-Week Total

Week:	1			2			3			4			5			6			7			8			9			10			11			12			13
Ending Date:	1/9/15			1/16/15			1/23/15			1/30/15			2/6/15			2/13/15			2/20/15			2/27/15			3/6/15			3/13/15			3/20/15			3/27/15			4/3/15


Beginning Book Cash Balance	$	115,714		$	113,161		$	116,357		$	116,074		$	116,180		$	113,183		$	110,167		$	94,440		$	94,841		$	93,581		$	92,561		$	89,136		$	93,150	$	115,714

RECEIPTS

Operating	$	5,665		$	6,350		$	7,120		$	4,005		$	3,887		$	4,275		$	1,892		$	4,572		$	4,773		$	4,698		$	4,560		$	4,973		$	5,198	$	61,968
Other		4			15			15			78			99			15			15			68			89			15			15			3,155			15		3,599


TOTAL RECEIPTS	$	5,669		$	6,365		$	7,135		$	4,084		$	3,986		$	4,290		$	1,907		$	4,641		$	4,862		$	4,713		$	4,575		$	8,128		$	5,213	$	65,567


DISBURSEMENTS

U.S. Operations
Payroll	$	(3,313	)	$	(175	)	$	(3,598	)	$	(177	)	$	(3,452	)	$	(175	)	$	(13,403	)	$	(177	)	$	(3,452	)	$	(175	)	$	(3,487	)	$	(177	)	$	(3,392)	$	(35,153)
Occupancy		(113	)		(77	)		(264	)		(997	)		(40	)		(133	)		(292	)		(973	)		(40	)		(141	)		(292	)		(1,022	)		(40)		(4,422)
Other Operating		(3,854	)		(2,503	)		(3,134	)		(2,696	)		(3,491	)		(3,092	)		(2,860	)		(3,018	)		(2,630	)		(2,974	)		(3,116	)		(2,843	)		(1,912)		(38,123)

Subtotal	$	(7,279	)	$	(2,755	)	$	(6,997	)	$	(3,870	)	$	(6,983	)	$	(3,400	)	$	(16,556	)	$	(4,168	)	$	(6,121	)	$	(3,290	)	$	(6,895	)	$	(4,041	)	$	(5,344)	$	(77,698)

E.U. Operations	$	(647	)	$	(414	)	$	(168	)	$	(79	)	$	-		$	(158	)	$	(618	)	$	(73	)	$	-		$	(157	)	$	(618	)	$	(73	)	$	-	$	(3,004)

Restructuring & Other	$	(296	)	$	-		$	(254	)	$	(30	)	$	-		$	(3,747	)	$	(460	)	$	-		$	-		$	(2,286	)	$	(487	)	$	-		$	-	$	(7,560)


TOTAL DISBURSEMENTS	$	(8,222	)	$	(3,169	)	$	(7,418	)	$	(3,978	)	$	(6,983	)	$	(7,306	)	$	(17,634	)	$	(4,240	)	$	(6,121	)	$	(5,733	)	$	(8,000	)	$	(4,114	)	$	(5,344)	$	(88,262)



NET CASH FLOW	$	(2,553	)	$	3,196		$	(283	)	$	105		$	(2,997	)	$	(3,016	)	$	(15,726	)	$	400		$	(1,260	)	$	(1,020	)	$	(3,425	)	$	4,014		$	(130)	$	(22,695)



Ending Book Cash Balance	$	113,161		$	116,357		$	116,074		$	116,180		$	113,183		$	110,167		$	94,440		$	94,841		$	93,581		$	92,561		$	89,136		$	93,150		$	93,019	$	93,019

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