UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 8-K
____________________
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (date of earliest event reported): February 15, 2013
K-V PHARMACEUTICAL COMPANY
(Exact name of registrant as specified in its charter)
____________________
Delaware |
1-9601 |
43-0618919 |
(State or other jurisdiction |
(Commission |
(I.R.S. Employer |
of incorporation) |
File Number) |
Identification No.) |
2280 Schuetz Road St. Louis, MO |
63146 |
(Address of principal executive offices) |
(Zip Code) |
(314) 645-6600
(Registrant's telephone number, including area code)
____________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
□ Written communications pursuant to Rule 425 under the Securities Act.
□ Soliciting material pursuant to Rule 14a-12 under the Exchange Act.
□ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
□ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
Item 7.01 Regulation FD Disclosure.
As previously disclosed in its Current Report on Form 8-K filed August 4, 2012, K-V Pharmaceutical Company (the Company) and certain of its wholly-owned domestic subsidiaries (collectively, the Debtors) filed voluntary petitions for reorganization (the Bankruptcy Cases) under Chapter 11 of the United States Bankruptcy Code (the Bankruptcy Code) in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court).
On January 7, 2013, the Debtors filed with the Bankruptcy Court a proposed Joint Chapter 11 Plan of Reorganization (as may be amended, modified or supplemented from time to time, the Proposed Plan) and related disclosure statement (as may be amended, modified or supplemented from time to time, the Disclosure Statement), as further described in the Companys Current Report on Form 8-K filed January 14, 2013. The Proposed Plan has not yet been approved by the Debtors stakeholders or confirmed by the Bankruptcy Court, and the Disclosure Statement has not yet been approved by the Bankruptcy Court.
On February 15, 2013, the Debtors filed with the Bankruptcy Court their Monthly Operating Report for the period from January 1, 2013 to January 31, 2013 (the MOR-January 2013), which included certain Makena® performance metrics. A copy of the MOR-January 2013 is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
This Current Report on Form 8-K (including Exhibit 99.1 hereto and any information contained therein) shall not be deemed to be an admission as to the materiality of any information required to be disclosed solely by reason of Regulation FD. The information in this Item 7.01, including Exhibit 99.1, shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) The following exhibits are furnished as part of this report:
Exhibit Number |
|
Description |
99.1 |
Monthly Operating Report for the Period From January 1, 2013 to January 31, 2013 |
The Company will post this Form 8-K on its Internet website at www.kvph.com. References to the Companys website address are included in this Current Report on Form 8-K only as inactive textual references and the Company does not intend them to be active links to the website. Information contained on the website does not constitute part of this Current Report on Form 8-K.
Cautionary Statement Regarding Financial and Operating Data
The Company cautions investors and potential investors not to place undue reliance upon the information contained in the MOR-January 2013, which was not prepared for the purpose of providing the basis for an investment decision relating to any of the securities of the Company. The Company cannot predict what the ultimate value of any of its securities may be and it remains too early to determine whether holders of any such securities will receive any distribution in the Debtors reorganization. In particular, in most cases under Chapter 11 of the Bankruptcy Code, holders of equity securities receive little or no recovery of value from their investment. The MOR-January 2013 is limited in scope, covers a limited time period and has been prepared solely for the purpose of complying with the monthly reporting requirements of the Office of the United States Trustee of the Southern District of New York and the Bankruptcy Court. The MOR-January 2013 was not audited or reviewed by independent accountants, is in a format prescribed by applicable bankruptcy laws and regulations and is subject to future adjustment and reconciliation. The MOR-January 2013 does not include all of the information and footnotes required by GAAP. Therefore, the MOR-January 2013 does not necessarily contain all information required in filings pursuant to the Exchange Act, or may present such information differently from such requirements. There can be no assurance that, from the perspective of an investor or potential investor in the Companys securities, the MOR-January 2013 is complete. The MOR-January 2013 also contains information for periods which are shorter or otherwise different from those required in the Companys reports pursuant to the Exchange Act, and such information might not be indicative of the Companys financial condition or operating results for the period that would be reflected in the Companys financial statements or in its reports pursuant to the Exchange Act. Results set forth in the MOR-January 2013 should not be viewed as indicative of future results.
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K contains various forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 (the PSLRA) and which may be based on or include assumptions concerning our operations, future results and prospects. Such statements may be identified by the use of words like plan, expect, aim, believe, project, anticipate, commit, intend, estimate, will, should, could, potential and other expressions that indicate future events and trends.
All statements that address expectations or projections about the future, including, without limitation, statements about the product launches, the impact of the Companys Chapter 11 proceedings, governmental and regulatory actions and proceedings, market position, revenues, expenditures and the impact of recalls and suspensions of shipments on revenues, adjustments to the financial statements, the filing of amended filings with the Securities and Exchange Commission (the SEC) and other financial results, are forward-looking statements.
All forward-looking statements are based on current expectations and are subject to risk and uncertainties. In connection with the PSLRAs safe harbor provisions, we provide the following cautionary statements with regard to the Company identifying important economic, competitive, political, regulatory and technological factors, among others, that could cause actual results or events to differ materially from those set forth or implied by the forward-looking statements and related assumptions. Such factors include (but are not limited to):
(1) the ability of the Company and the other Debtors to continue as a going concern;
(2) the ability of the Company to comply with the milestones in its debtor-in-possession financing facility, and obtain Bankruptcy Court approval of its motion for approval of the Proposed Plan and related Disclosure Statement as well as other motions filed in the Bankruptcy Cases;
(3) the ability of the Company and the other Debtors to satisfy the conditions of the Proposed Plan and to consummate the Proposed Plan, including the contemplated rights offering;
(4) objections that may be raised with respect to the Proposed Plan and related Disclosure Statement by various creditors, equity holders and other constituents of the Debtors and the Bankruptcy Courts treatment of such objections;
(5) the effects of the Bankruptcy Cases on the Company and the other Debtors and the interests of various creditors, equity holders and other constituents;
(6) the effects of rulings of the Bankruptcy Court in the Bankruptcy Cases and the outcome of the cases in general;
(7) the length of time the Company and the other Debtors will operate under the Bankruptcy Cases;
(8) risks associated with third-party motions in the Bankruptcy Cases, which may interfere with the ability of the Company and the other Debtors to develop and consummate the Proposed Plan;
(9) the potential adverse effects of the Bankruptcy Cases on the Companys and the other Debtors liquidity or results of operations;
(10) the ability to execute the Companys business and restructuring plans;
(11) increased legal costs related to the Companys bankruptcy filing and other litigation;
(12) that the Companys Class A Common Stock and Class B Common Stock will be, or will continue to be, traded on the OTCQB Marketplace and whether sufficient volumes and liquidity will develop; and
(13) the ability of the Company and the other Debtors to maintain contracts that are critical to their operation, including to obtain and maintain normal terms with their vendors, customers and service providers and to retain key executives, managers and employees.
This discussion is not exhaustive, but is designed to highlight important factors that may impact our forward-looking statements.
Because the factors referred to above, as well as the statements included in Part I, Item 1A Risk Factors, of our Annual Report on Form 10-K for the fiscal year ended March 31, 2012, the statements under the heading Risk Factors in our Registration Statement on Form S-1 filed with the SEC on July 31, 2012, and the statements included in Article XI Certain Risk Factors to be Considered of the Disclosure Statement, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements made by us or on our behalf, you should not place undue reliance on any forward-looking statements. All forward-looking statements attributable to us are expressly qualified in their entirety by the cautionary statements in this Cautionary Note Regarding Forward-Looking Statements and the risk factors that are included under Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended March 31, 2012, the risk factors under the heading Risk Factors in our Registration Statement on Form S-1 filed with the SEC on July 31, 2012, and the risk factors included in Article XI Certain Risk Factors to be Considered of the Disclosure Statement. Further, any forward-looking statement speaks only as of the date on which it is made and we are under no obligation to update any of the forward-looking statements after the date of this Current Report on Form 8-K. New factors emerge from time to time, and it is not possible for us to predict which factors will arise, when they will arise and/or their effects. We may amend the Proposed Plan and the Disclosure Statement and those amendments could be material. In addition, we cannot assess the impact of each factor on our future business or financial condition or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
* * *
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: February 20, 2013
K-V PHARMACEUTICAL COMPANY |
|||
By: | /s/ Patrick J. Christmas | ||
Patrick J. Christmas | |||
Vice President, General Counsel and Secretary | |||
EXHIBIT 99.1
United States Bankruptcy Court |
|
|
Southern District of New York |
|
|
|
X |
|
In re: |
: |
Chapter 11 |
|
: |
|
K-V Discovery Solutions, Inc. et al., |
: |
Case No. 12-13346 (ALG) |
|
: |
|
Debtors. |
X |
Jointly Administered |
|
|
|
Monthly Operating Report for the Period
January 1, 2013 to January 31, 2013
Debtors Address: |
2280 Schuetz Road | |
|
St. Louis, Missouri 63146 | |
|
Telephone: (314) 645-6600 | |
|
|
|
Debtors Attorneys: |
Willkie Farr & Gallagher LLP | |
|
787 Seventh Avenue | |
|
New York, New York 10019 | |
|
Telephone: (212) 728-8000 | |
This Monthly Operating Report ("MOR") has been prepared solely for the purposes of complying with the monthly reporting requirements applicable in these Chapter 11 cases and is in a format that the Debtors believe is acceptable to the United States 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 accounting principles generally accepted in the United States ("GAAP").
I declare under penalty of perjury that this report and the attached documents are true and correct to the best of my knowledge and belief.
/s/ Thomas S. McHugh |
February 15, 2013 | |
Thomas S. McHugh |
| |
Chief Financial Officer |
| |
K-V Pharmaceutical Company |
In re |
K-V DISCOVERY SOLUTIONS, INC., et al., |
|
Case No. |
12-13346 (ALG) |
Debtors. |
|
Reporting Period: |
1/1/13 -1/31/13 | |
|
|
Federal Tax I.D.# |
13-1587982 |
CORPORATE MONTHLY OPERATING REPORT | |||
File with the Court and submit a copy to the United States Trustee within 20 days after the end of the month and submit a copy of the report to any official committee appointed in the case. | |||
(Reports for Rochester and Buffalo Divisions of Western District of New York are due 15 days after the end of the month, as are the reports for Southern District of New York.) |
REQUIRED DOCUMENTS |
Form No. |
Document Attached |
Explanation Attached |
Schedule of Cash Receipts and Disbursements |
MOR-1 |
x |
|
Bank Reconciliation (or copies of debtor's bank reconciliations) |
MOR-1 |
x |
|
Copies of bank statements |
|
x | |
Cash disbursements journals |
|
x | |
Statement of Operations |
MOR-2 |
x |
|
Balance Sheet |
MOR-3 |
x |
|
Status of Post-petition Taxes |
MOR-4 |
x |
x |
Copies of IRS Form 6123 or payment receipt (See Notes to MOR 4) |
|
x | |
Copies of tax returns filed during reporting period (See Notes to MOR 4) |
|
x | |
Summary of Unpaid Post-petition Debts (See Notes to MOR 4) |
MOR-4 |
|
x |
Listing of Aged Accounts Payable (See MOR 7) |
x |
||
Accounts Receivable Reconciliation and Aging |
MOR-5 |
x |
|
Taxes Reconciliation and Aging (See MOR 7) |
MOR-5 |
|
x |
Payments to Insiders and Professionals |
MOR-6 |
x |
|
Post Petition Status of Secured Notes, Leases Payable |
MOR-6 |
x |
|
Debtor Questionnaire |
MOR-7 |
x |
|
Makena® Performance Metrics |
|
x |
NOTES TO MONTHLY OPERATING REPORT
This MOR includes activity from the following Debtors:
Debtor |
Case Number |
|
K-V Discovery Solutions, Inc. |
12-13346 | |
K-V Pharmaceutical Company |
12-13347 | |
Ther-Rx Corporation |
12-13348 | |
K-V Generic Pharmaceuticals, Inc. |
12-13349 | |
Zeratech Technologies USA, Inc. |
12-13350 | |
Drug Tech Corporation |
12-13351 | |
K-V Solutions USA, Inc. |
12-13352 | |
FP1096, Inc. |
12-13353 |
General Notes:
The financial statements and supplemental information contained herein are preliminary, unaudited, and may not comply in all material respects with GAAP. In addition, the financial statements and supplemental information contained herein represent consolidated information.
The unaudited consolidated financial statements have been derived from the books and records of the Debtors and exclude activity for their non-debtor subsidiaries. This information has not been subject to certain procedures that would typically be applied to financial information in accordance with GAAP, and upon application of such procedures the financial information could be subject to changes, and these changes could be material.
The financial information contained herein is presented on a preliminary and unaudited basis and remains subject to future adjustment. The Debtors are reviewing their books and records and other information on an ongoing basis to determine whether the financial statements should be supplemented or otherwise amended. The Debtors reserve the right to file, at any time, such supplements or amendments to the financial statements that form a part of this MOR. The financial statements should not be considered an admission regarding any of the Debtors income, expenditures or general financial condition, but rather, a current compilation of the Debtors books and records. The Debtors do not make, and specifically disclaim, any representation or warranty as to the completeness or accuracy of the information set forth herein.
The unaudited consolidated financial statements contained herein have been prepared on a going concern basis and do not reflect or provide all of the possible consequences of the ongoing chapter 11 cases. Specifically, the unaudited consolidated financial statements do not present the amount which will ultimately be paid to settle liabilities and contingencies which may be required in these cases. As a result of the chapter 11 proceedings, the Debtors may take, or may be required to take, actions which may cause assets to be realized, or liabilities to be liquidated, for amounts other than those reflected in the unaudited consolidated financial statements.
Certain footnote disclosures normally included in unaudited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. Preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of expenses during the reporting period. The results of operations contained herein are not necessarily indicative of results which may be expected for any other period or for the full year and may not necessarily reflect the consolidated results of operations and financial position of the Debtors in the future.
MOR-1:
SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS 1
(Dollars in thousands)
Debtor |
Case Number |
Cash Receipts |
||||||
Ther-Rx Corporation |
12-13348 | $ | 8,451 | |||||
K-V Pharmaceutical Company |
12-13347 | 245 | ||||||
DrugTech Corporation |
12-13351 | 10 | ||||||
K-V Discovery Solutions, Inc. |
12-13346 | 0 | ||||||
K-V Generic Pharmaceuticals, Inc. |
12-13349 | 0 | ||||||
Zeratech Technologies USA, Inc. |
12-13350 | 0 | ||||||
K-V Solutions USA Inc. |
12-13352 | 0 | ||||||
FP1096, Inc. |
12-13353 | 0 | ||||||
Total Cash Receipts |
$ | 8,706 | ||||||
Debtor |
Case Number |
Cash 2 Disbursements |
||||||
K-V Pharmaceutical Company |
12-13347 | $ | (6,580 | ) | ||||
Ther-Rx Corporation |
12-13348 | (3,449 | ) | |||||
DrugTech Corporation |
12-13351 | (15 | ) | |||||
K-V Discovery Solutions, Inc. |
12-13346 | 0 | ||||||
K-V Generic Pharmaceuticals, Inc. |
12-13349 | 0 | ||||||
Zeratech Technologies USA, Inc. |
12-13350 | 0 | ||||||
K-V Solutions USA Inc. |
12-13352 | 0 | ||||||
FP1096, Inc. |
12-13353 | 0 | ||||||
Total Cash Disbursements |
$ | (10,044 | ) |
Notes
1 Cash is received and disbursed by the Debtors as described in the Debtors motion to approve continued use of their cash management system (which motion was granted on a final basis pursuant to an order entered by the Bankruptcy Court on January 15, 2013) and is consistent with the Debtors historical cash management practices. All amounts listed are the balances reported by the bank as of the end of the reporting period. Copies of bank statements will be provided upon reasonable request in writing to counsel for the Debtors.
2 Cash disbursements during the month of January 2013 include $1,081 of outstanding checks.
MOR-1 (CONT):
BANK RECONCILIATIONS 1, 2, 3, 4, 5, 6
(Dollars in thousands)
Debtor |
Case Number |
Bank and Account Description |
Bank Account No. Ending In |
Bank Balance |
|||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Money Market / Investment Account |
1225 | $ | 28,293 | ||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Bank / Operating Account |
9158 | 5,336 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Bank / PDI Escrow Account |
1876 7 | 1,819 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Bank / Deposit Account |
0941 | 1,025 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Bank / Nesher Escrow Account |
0383 | 501 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
Commerce Bank / Certificate of Deposit |
2433 | 150 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
AMEX Centurion Bank / Certificate of Deposit |
8420 | 60 | |||||||||
K-V Pharmaceutical Company |
12-13347 |
Fifth Third Bank / Utility Deposit |
0479 8 | 2 | |||||||||
Drug Tech Corporation |
12-13351 |
Wells Fargo Bank/ DrugTech Operating Acct |
6823 | 3 | |||||||||
Drug Tech Corporation |
12-13351 |
US Bank / DrugTech Custody Account |
3256 | 2 | |||||||||
$ | 37,191 |
Notes
1 The Debtors have not included copies of their bank statements or cash disbursement journals due to the voluminous nature of these reports. Copies of the Debtors bank statements and cash disbursement journals will be provided upon reasonable request in writing to counsel for the Debtors.
2 The Debtors reconcile their bank accounts on a monthly basis.
3 The Debtors have excluded accounts with no balance as of the end of the reporting period.
4 The Debtors bank balances exclude $1,120 of outstanding checks.
5 During this reporting period, the Debtors deposited funds into a bank account in the name of K-V Pharmaceutical Company with Fifth Third Bank (Deposit Account, bank account no. ending in 0941), which account had a zero balance at the end of the previous reporting period and was not listed on the previous MORs Bank Reconciliation Schedule.
6 During this reporting period, the Debtors closed a bank account in the name of K-V Pharmaceutical Company with Commerce Bank (Deposit Account, bank account no. ending in 6373).
7 This account was inadvertently identified in the Debtors motion to approve continued use of their cash management system as ending in 4187.
8 The Debtors opened this bank account post-petition on August 28, 2012 in accordance with the order of the Bankruptcy Court, entered on August 23, 2012, that, among other things, established procedures for providing deposits to the Debtors utility service providers that request adequate assurance of payment and deemed such utility service providers to have adequate assurance of payment.
MOR-2:
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited; Dollars in thousands)
For the Month Ended January 31, 20131 |
||||
Net revenues |
$ | 7,024 | ||
Cost of sales |
862 | |||
Gross profit |
6,162 | |||
Research and development |
548 | |||
Selling and administrative |
5,487 | |||
Operating expenses |
6,035 | |||
Operating income |
127 | |||
Gain on debt extinguishment 2 |
(929 | ) | ||
Interest, net and other |
1,356 | |||
Reorganization items, net |
2,204 | |||
Total other (income), net |
2,631 | |||
Loss from continuing operations before income taxes |
(2,504 | ) | ||
Income tax provision |
749 | |||
Net loss from continuing operations |
$ | (3,253 | ) |
Notes
1 The Debtors prepare their income statement on an accrual basis. Accordingly, the Debtors Statement of Operations, as set forth in this MOR, reflects the results of the Debtors operations for the month of January 2013.
2 The gain on debt extinguishment reflects the remaining difference between the previously estimated Hologic Inc. liability recorded on the Debtors balance sheet and the $60,000 payment in satisfaction thereof under the settlement agreement between the Debtors and Hologic Inc. (the Hologic Settlement Agreement), which was approved pursuant to an order of the Bankruptcy Court entered on December 27, 2012 [Docket No. 498]. The majority of the gain on debt extinguishment resulting from the Hologic Settlement Agreement was recognized in the month ended December 31, 2012. Previously, the liability was included in Total Liabilities Subject to Compromise on the Debtors consolidated balance sheet.
MOR-3:
CONSOLIDATED BALANCE SHEET
(Unaudited; Dollars in thousands)
As of January 31, |
||||
2013 |
||||
ASSETS |
||||
Current Assets: |
||||
Cash and cash equivalents |
$ | 33,539 | ||
Restricted cash |
2,380 | |||
Undrawn DIP Facility proceeds |
21,950 | |||
Receivables, net |
15,371 | |||
Inventories, net |
5,583 | |||
Other current assets |
7,304 | |||
Income taxes receivable |
382 | |||
Total Current Assets |
86,509 | |||
Property and equipment, less accumulated depreciation |
1,729 | |||
Intangible assets, net |
114,623 | |||
Other assets |
15,275 | |||
Total Assets |
$ | 218,136 | ||
LIABILITIES |
||||
LIABILITIES NOT SUBJECT TO COMPROMISE: |
||||
Current Liabilities: |
||||
Accounts payable |
$ | 3,960 | ||
Accrued expenses |
24,944 | |||
Other current liabilities |
2,765 | |||
Debtor-in-Possession Financing 1 |
85,000 | |||
Total Liabilities not subject to compromise |
116,669 | |||
Total liabilities subject to compromise |
578,849 | |||
Total Liabilities |
695,518 | |||
SHAREHOLDERS' DEFICIT |
||||
Preferred Stock |
|
|||
Class A Common Stock |
657 | |||
Class B Common Stock |
98 | |||
Additional paid-in capital |
206,099 | |||
Accumulated deficit |
(626,827 | ) | ||
Less: Treasury stock |
(57,409 | ) | ||
Total Shareholders' Deficit |
(477,382 | ) | ||
Total Liabilities and Shareholders' Deficit |
$ | 218,136 |
Notes
1 Debtor-in-Possession Financing in the amount of $85,000 is reflective of the Debtors debtor-in-possession financing facility (the DIP Facility), which was approved pursuant to an order of the Bankruptcy Court (the DIP Order) entered on December 27, 2012 [Docket No. 497]. For administrative purposes, the net proceeds of the DIP Facility are being held in an account in the name of Silver Point Finance, LLC, the agent for the DIP Facility.
MOR-4:
STATUS OF POST-PETITION TAXES 1, 2
(Dollars in thousands)
Federal |
Beginning Tax |
Amount Withheld and/or Accrued |
Amount Paid |
Ending Tax |
||||||||||||
Withholding |
$ | 0 | $ | 181 | $ | (181 | ) | $ | 0 | |||||||
FICA-Employee |
0 | 93 | (93 | ) | 0 | |||||||||||
FICA-Employer |
0 | 93 | (93 | ) | 0 | |||||||||||
Total Federal Taxes |
$ | 0 | $ | 367 | $ | (367 | ) | $ | 0 | |||||||
State and Local |
||||||||||||||||
Withholding |
$ | 0 | $ | 134 | $ | (134 | ) | $ | 0 | |||||||
Sales Tax |
10 | 0 | 0 | 10 | ||||||||||||
Unemployment Tax |
0 | 5 | (5 | ) | 0 | |||||||||||
Real Property |
10 | 1 | 0 | 11 | ||||||||||||
Personal Property |
21 | 0 | 0 | 21 | ||||||||||||
Franchise Tax |
5 | 20 | 0 | 25 | ||||||||||||
Total State and Local |
$ | 46 | $ | 160 | $ | (139 | ) | $ | 67 | |||||||
Total Taxes |
$ | 46 | $ | 527 | $ | (506 | ) | $ | 67 |
Notes
1 - The Debtors have not annexed copies of tax returns filed with various taxing authorities during the current reporting period to this MOR, nor have they included the Debtors IRS Form 6123 with this MOR. Copies of such tax returns and IRS Form 6123 will be provided upon reasonable request in writing to counsel for the Debtors.
2 - The Debtors believe they are paying all undisputed taxes and preparing and filing all tax returns when due or obtaining extensions where necessary.
MOR-4 (CONT):
SUMMARY OF UNPAID POST-PETITION DEBTS 1
(Dollars in thousands)
Description |
Amount |
|||
0 - 30 days old |
$ | 3,189 | ||
31+ days old |
771 | |||
Total Vendor Accounts Payable Post-petition |
$ | 3,960 |
Notes
1 - The Debtors believe they are paying all undisputed post-petition obligations according to terms.
MOR-5:
ACCOUNTS RECEIVABLE RECONCILIATION AND AGING
(Dollars in thousands)
Description |
Amount |
|||
0 - 30 days old |
$ | 15,429 | ||
31 - 60 days old |
138 | |||
61 - 90 days old |
23 | |||
91+ days old |
959 | |||
Total Customer Accounts Receivable |
$ | 16,549 | ||
Customer Allowances |
(1,178 | ) | ||
Total Accounts Receivable |
$ | 15,371 |
MOR-6:
PAYMENTS TO INSIDERS AND PROFESSIONALS
(Dollars in thousands)
INSIDERS |
|||||||||
Name |
Type of Payment 1 |
Current Month Amount Paid |
Total Paid Since August 4, 2012 2 |
||||||
Christmas, Patrick |
Salary/Expenses |
$ | 21 | $ | 125 | ||||
Divis, Gregory |
Salary/Expenses |
30 | 181 | ||||||
McHugh, Thomas |
Salary/Expenses |
21 | 128 | ||||||
Baldini, Robert |
Director Fees/Expenses |
50 | 80 | ||||||
Bentley, Greg |
Director Fees/Expenses |
49 | 78 | ||||||
Lehrer, Joe |
Director Fees/Expenses |
69 | 110 | ||||||
Sidransky, David MD |
Director Fees/Expenses |
52 | 82 | ||||||
Stancic, Ana |
Director Fees/Expenses |
50 | 79 | ||||||
Total |
$ | 342 | $ | 863 |
Notes
1 Additional detail concerning payments to the Debtors insiders will be provided upon reasonable request in writing to counsel for the Debtors.
2 This table lists only those insiders who received a payment during the current reporting period. Additional insiders have received payments during the Debtors chapter 11 cases. For information regarding the total amount paid to such insiders during the Debtors chapter 11 cases, please refer to previously filed MORs.
PROFESSIONALS 1 |
|||||||||||||||||
Name |
Date of Court Order Authorizing Payment |
Amount Requested 2 |
Current Month Amount Paid |
Total Paid To Date 3 |
Total Incurred & Unpaid |
||||||||||||
Alston & Bird LLP |
September 14, 2012 |
$ | 0 | $ | 51 | $ | 225 | $ | 0 | ||||||||
Arnall Golden Gregory LLP |
October 10, 2012 |
0 | 14 | 28 | 7 | ||||||||||||
Duff & Phelps, LLC |
October 10, 2012 |
0 | 102 | 368 | 90 | ||||||||||||
Curtis, Mallet-Prevost, Colt & Mosle LLP |
January 15, 2013 |
0 | 0 | 0 | 0 | ||||||||||||
Epiq Bankruptcy Solutions, LLC |
September 27, 2012 |
25 | 25 | 173 | 7 | ||||||||||||
Ernst & Young, LLP |
September 28, 2012 |
14 | 17 | 17 | 4 | ||||||||||||
Fortgang Consulting |
September 14, 2012 |
0 | 0 | 0 | 0 | ||||||||||||
Houlihan & Lokey Capital, Inc. |
September 14, 2012 |
151 | 305 | 1,086 | 0 | ||||||||||||
Jefferies & Company, Inc. |
October 10, 2012 |
174 | 275 | 1,125 | 239 | ||||||||||||
Lowenstein Sandler PC |
December 27, 2012 |
400 | 400 4 | 400 | 0 | ||||||||||||
Stroock Stroock & Lavan LLP |
October 10, 2012 |
255 | 535 | 1,010 | 248 | ||||||||||||
Weil, Gotshal & Manges LLP |
September 27, 2012 |
0 | 0 | 1,088 | 0 | ||||||||||||
Willkie Farr & Gallagher LLP |
September 27, 2012 |
1,320 | 564 | 2,449 | 1,913 | ||||||||||||
Total |
$ | 2,339 | $ | 2,288 | $ | 7,969 | $ | 2,508 |
Notes
1 Represents professional services exclusive of those rendered by professionals retained by the Debtors pursuant to the September 27, 2012 order of the Bankruptcy Court authorizing the Debtors to employ and retain professionals utilized in the ordinary course of business professional service providers.
2 Represents amounts requested during the current reporting period.
3 Represents payments made from the date of the Bankruptcy Courts order authorizing each firms retention.
4 The $400 to Lowenstein Sandler PC was paid pursuant to the DIP Order.
MOR-6 (CONT):
POST-PETITION STATUS OF SECURED NOTES, LEASES PAYABLE
AND ADEQUATE PROTECTION PAYMENTS1
(Dollars in thousands)
Name of Creditor |
Scheduled Monthly Payment Due |
Amount Paid During Month |
||||||
Building lease payable |
$ | 46 | $ | 46 | ||||
Total Payments |
$ | 46 |
Notes
1 - The Debtors schedule of lease payments, as set forth in this MOR, only reflects payments made pursuant to the Debtors real property lease. Immaterial leases of personal property are not included in this MOR-6.
MOR-7:
DEBTOR QUESTIONNAIRE
Must be completed each month. If the answer to any of the questions is "Yes", provide a detailed explanation of each item. Attach additional sheets if necessary. |
Yes |
No | ||||
|
|
|
|
| ||
1 |
|
Have any assets been sold or transferred outside the normal course of business this reporting period? |
X | |||
2 |
|
Have any funds been disbursed from any account other than a debtor in possession account this reporting period? |
X | |||
3 |
|
Is the Debtor delinquent in the timely filing of any post-petition tax returns? |
|
X | ||
4 |
|
Are workers compensation, general liability or other necessary insurance coverages expired or cancelled, or has the debtor received notice of expiration or cancellation of such policies? |
|
X | ||
5 |
|
Is the Debtor delinquent in paying any insurance premium payment? |
|
X | ||
6 |
|
Have any payments been made on pre-petition liabilities this reporting period? |
X |
| ||
7 |
|
Are any post-petition receivables (accounts, notes or loans) due from related parties? |
|
X | ||
8 |
|
Are any post-petition payroll taxes past due? |
|
X | ||
9 |
|
Are any post-petition State or Federal income taxes past due? |
|
X | ||
10 |
|
Are any post-petition real estate taxes past due? |
|
X | ||
11 |
|
Are any other post-petition taxes past due? |
|
X | ||
12 |
|
Have any pre-petition taxes been paid during this reporting period? |
X | |||
13 |
|
Are any amounts owed to post-petition creditors delinquent? |
|
X | ||
14 |
|
Are any wages payments past due? |
|
X | ||
15 |
|
Have any post-petition loans been received by the Debtor from any party? |
X | |||
16 |
|
Is the Debtor delinquent in paying any US Trustee fees? |
|
X | ||
17 |
|
Is the Debtor delinquent with any court ordered payments to attorneys or other professionals? |
|
X | ||
18 |
|
Have the owners or shareholders received any compensation outside of the normal course of business? |
|
X | ||
Explanations |
||||||
6 |
Pursuant to an order entered by the Bankruptcy Court, the Debtors were authorized to honor certain prepetition obligations to their customers. |
|||||
13 |
The Debtors believe that all undisputed post-petition accounts payable have been and are being paid according to agreed-upon terms specific to each vendor and/or service provider. Any aged amounts represent items subject to valid disputes and certain items which have been paid subsequent to the end of this reporting period. |
MAKENA® PERFORMANCE METRICS
Makena® (hydroxyprogesterone caproate injection) is the Debtors single-most valuable product. The information below addresses certain key performance metrics related to Makena®. The amounts shown are based on estimates and are subject to change. Gross revenues are preliminary and unaudited, and are not prepared in accordance with GAAP.
Three Months Ended |
Gross Revenues ($ in thousands)(1) |
Total Prescriptions (2) |
Vials Shipped to Customers (3) |
|||||||||
6/30/2012 |
$ | 13,393 | 2,577 | 3,882 | ||||||||
9/30/2012 |
$ | 13,006 | 3,046 | 3,770 | ||||||||
12/31/2012 |
$ | 23,495 | 3,438 | 6,810 | ||||||||
1/31/2013(4) |
$ | 23,909 | 3,630 | 6,930 |
Notes: |
||||||||||||
(1) Amounts shown are estimated based on the number of vials shipped to customers and list price/vial. |
||||||||||||
(2) Represents total prescriptions reported to the Debtors and does not include cancellations. |
||||||||||||
(3) Represents paid vials shipped to the Debtors' customers, which include specialty pharmacies and distributors. |
||||||||||||
(4) Data for the months of November 2012, December 2012, and January 2013 is used in the absence of complete data for the three months ending March 31, 2013. |