Exhibit 99.1
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
| In re: Pernix Sleep, Inc.et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
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 | | |
| Schedule of Disbursements by Debtor Entity | MOR-1a | X | | |
| Schedule of Debtor Bank Account Balances | MOR-1b | X | | |
| Schedule of Professional Fees and Expenses Paid | MOR-1c | X | | |
| Copies of bank statements | | | | Certification Attached |
| Cash disbursements journals | | | | Certification Attached |
| Bank reconciliation | | | | Certification Attached |
| Statement of Operations | MOR-2 | X | | |
| Balance Sheet | MOR-3 | X | | |
| Status of Postpetition Taxes | | | | Certification Attached |
| Copies of IRS Form 6123 or payment receipt | | | | Certification Attached |
| Copies of tax returns filed during reporting period | | | | Certification Attached |
| Summary of Unpaid Postpetition Debts | | | | |
| Summary of Unpaid Post Petition Accounts Payables | MOR-4 | X | | |
| Accounts Receivable 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.
| /s/ Glenn Whaley | | April 30, 2019 |
| Signature of Authorized Individual* | | Date |
| Glenn Whaley | | VP Finance, Principal Financial and Accounting 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:
The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, as applicable, are: Pernix Sleep, Inc. (1599), Cypress Pharmaceuticals, Inc. (1860), Gaine, Inc. (3864), Hawthorn Pharmaceuticals, Inc. (2769), Macoven Pharmaceuticals, L.L.C. (4549), Pernix Holdco 1, LLC, Pernix Holdco 2, LLC, Pernix Holdco 3, LLC, Pernix Ireland Limited, Pernix Ireland Pain Designated Activity Company, Pernix Manufacturing, LLC (1236), Pernix Therapeutics Holdings, Inc. (4736), Pernix Therapeutics, LLC (1128) and Respicopea, Inc. (1303). The Debtor’s mailing address for purposes of this chapter 11 case is 10 North Park Place Suite 201, Morristown, NJ 07960.
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
| In re: Pernix Sleep, Inc.et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
CERTIFICATION REGARDING POST-PETITION BANK ACCOUNT
RECONCILIATIONS, CASH DISBURSEMENT JOURNALS AND
COMPLIANCE AND PAYMENT OF POST-PETITION TAXES
I, Glenn Whaley, VP Finance, Principal Financial and Accounting Officer, of Pernix Sleep, Inc.et al. (the “Debtors”) hereby certify the following:
1. Attached to MOR-1 is a listing of the Debtor’s bank accounts, by account number, and the opening and closing balances. These accounts are reconciled monthly in accordance with the Debtor’s ordinary course accounting practices and are available to the United States Trustee upon request.
2. Cash disbursement journals are maintained in accordance with the Debtor’s ordinary course accounting practices and are available to the United States Trustee upon request.
3. To the best of my knowledge and belief, the Debtor is current on all post-petition taxes, and no post-petition tax amounts are past due.
| /s/ Glenn Whaley | | April 30, 2019 |
Signature of Authorized Individual*
VP Finance, Principal Financial and Accounting Officer | | Date |
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
| In re: Pernix Sleep, Inc.et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
Notes to Monthly Operating Report
Debtor in Possession Financial Statements
The financial statements and supplemental information presented in this Monthly Operating Report (“MOR”) have been prepared using the Debtors’ books and records solely to comply with the monthly reporting requirements under the United States Bankruptcy Code and those of the United States Trustee for Region Three.
The financial statements and supplemental information presented herein are unaudited, preliminary in nature, and may not comply with generally accepted accounting principles in the United States of America (“U.S. GAAP”) in all material respects. These preliminary unaudited financial statements and other information represent the Debtor’s good faith attempt to comply with the requirements of the United States Bankruptcy Code and those of the United States Trustee using the resources available. This information is limited in scope to the requirements of this report.
These preliminary unaudited financial statements have not been subject to procedures that would typically be applied to financial information presented in accordance with U.S. GAAP, and upon application of such procedures, the Debtors believe that the financial information could be subject to changes, which could be material. Certain totals may not sum due to rounding.
All related tax implications are not currently reflected in the preliminary unaudited financial statements herein. The financial impact of potential tax and other adjustments on the accompanying preliminary unaudited financial statements cannot be determined at this time.
There may be adjustments to the opening balance sheet as of February 17, 2019 that will impact these accompanying preliminary unaudited financial statements. ASC 805 permits a one-year measurement period in which the opening balance sheet can be adjusted if additional information becomes available.
Liabilities Subject to Compromise
As a result of the commencement of the Debtors’ chapter 11 cases, the payment of certain prepetition indebtedness of the Debtors are subject to compromise or other treatment under a plan of reorganization.
Reorganization Items
ASC 852 requires expenses and income directly associated with the Debtors’ chapter 11 cases to be reported separately in the income statement as reorganization items. Reorganization items include expenses related to legal advisory and representation services, and other professional consulting and advisory services. Reorganization costs also include adjustment to record debt at the estimated amount of the claim and an estimate of the loss on sale of assets which is pending a valuation.
Litigation
The Debtors are subject to lawsuits and claims that arise out of its operations in the normal course of business.
Prior to the petition date, the Debtors were the defendant to various legal proceedings, described in detail in the most recent publicly filed financial statements, which are stayed during the course of the chapter 11 bankruptcy proceedings.
There are uncertainties inherent in any litigation and appeal and the Debtors cannot predict the outcome. At this time the Debtors are unable to estimate possible losses or ranges of losses that may result from such legal proceedings described in detail in the most recent publicly filed financial statements, and it has not accrued any amounts in connection with such legal proceedings in the financial statements herein, other than attorney’s fees accrued prior to the petition date.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR – 1
Consolidated Schedule of Cash Receipts and Disbursements (1)
For the Period: February 18, 2019 - March 31, 2019
(Unaudited)
| $ USD '000s | | February 18, 2019 – March 31, 2019 |
| | | Pernix Therapeutics, LLC | | Cypress Pharmaceuticals, Inc. | | Pernix Ireland Limited | | Pernix Ireland Pain
Designated Activity
Company | | Pernix Therapeutics Holdings, Inc. | | Total |
| Beginning Cash Balance (Book) | | $ | 2,724 | | | $ | 3,322 | | | $ | 54 | | | $ | 172 | | | $ | 5 | | | $ | 6,276 | |
| Receipts | | | | | | | | | | | | | | | | | | | | | | | | |
| Operating Receipts | | $ | 19,224 | | | $ | 2,391 | | | $ | 2 | | | $ | - | | | $ | - | | | | 21,617 | |
| Miscellaneous Receipts | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Total Receipts | | | 19,224 | | | $ | 2,391 | | | | 2 | | | | | | | | | | | | 21,617 | |
| Operating Disbursements | | | | | | | | | | | | | | | | | | | | | | | | |
| Payroll & Benefits | | | (1,101 | ) | | | - | | | | - | | | | - | | | | - | | | | (1,101 | ) |
| Gross to Net Disbursements | | | (10,945 | ) | | | (466 | ) | | | - | | | | - | | | | - | | | | (11,411 | ) |
| Inventory | | | (1,574 | ) | | | (436 | ) | | | - | | | | (150 | ) | | | - | | | | (2,160 | ) |
| Royalties | | | (156 | ) | | | - | | | | - | | | | - | | | | - | | | | (156 | ) |
| Insurance | | | (232 | ) | | | - | | | | - | | | | - | | | | - | | | | (232 | ) |
| Other G&A | | | (459 | ) | | | (56 | ) | | | (1 | ) | | | (3 | ) | | | - | | | | (518 | ) |
| Total Operating Disbursements | | | (14,466 | ) | | | (959 | ) | | | (1 | ) | | | (153 | ) | | | - | | | | (15,579 | ) |
| Operating Cash Flow | | | 4,757 | | | | 1,432 | | | | 1 | | | | (153 | ) | | | - | | | | 6,038 | |
| Debt Service | | | | | | | | | | | | | | | | | | | | | | | | |
| ABL | | | - | | | | - | | | | - | | | | - | | | | (14,529 | ) | | | (14,529 | ) |
| Total Debt Service | | | - | | | | - | | | | - | | | | - | | | | (14,529 | ) | | | (14,529 | ) |
| Restructuring Costs | | | | | | | | | | | | | | | | | | | | | | | | |
| DIP Loan Interest and Fees | | | (131 | ) | | | - | | | | - | | | | - | | | | - | | | | (131 | ) |
| Professional Fees | | | (1,027 | ) | | | - | | | | - | | | | - | | | | - | | | | (1,027 | ) |
| Total Non-Operating Disbursements | | | (1,157 | ) | | | - | | | | - | | | | - | | | | - | | | | (1,157 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total Disbursements | | $ | (15,624 | ) | | $ | (959 | ) | | $ | (1 | ) | | $ | (153 | ) | | $ | (14,529 | ) | | $ | (31,265 | ) |
| Net Cash Flow | | $ | 3,600 | | | $ | 1,432 | | | $ | 1 | | | | (153 | ) | | | (14,529 | ) | | $ | (9,648 | ) |
| DIP Draw | | | 4,000 | | | | - | | | | - | | | | - | | | | 14.529 | | | | 18,529 | |
| Nalpropion Escrow Transfer | | | (2,772 | ) | | | - | | | | - | | | | - | | | | | | | | (2,772 | ) |
| Ending Cash Balance (Book) | | $ | 7,552 | | | $ | 4,754 | | | $ | 55 | | | $ | 19 | | | $ | 5 | | | $ | 12,384 | |
| Nalpropion Escrow Account Cash Balance | | $ | 2,772 | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 2,772 | |
Notes:
(1) The Schedule of Cash Receipts and Disbursements is presented on a book basis.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR – la
Schedule of Disbursements by Debtor Entity(1)
For the Period: February 18, 2019 - March 31, 2019
(Unaudited)
$ USD '000s
Debtors | | Case Number | | February 18, 2019 - March 31, 2019 | | Cumulative
Since Filing |
| Pernix Therapeutics, LLC | | 19-10329 | | $ | (15,624 | ) | | $ | (15,624 | ) |
| Cypress Pharmaceuticals, Inc. | | 19-10330 | | | (959 | ) | | | (959 | ) |
| Pernix Ireland Limited | | 19-10325 | | | (1 | ) | | | (1 | ) |
| Pernix Ireland Pain Designated Activity Company | | 19-10327 | | | (153 | ) | | | (153 | ) |
| Pernix Therapeutics Holdings, Inc.(2) | | 19-10324 | | | (14,529 | ) | | | (14,529 | ) |
| Gaine, Inc. | | 19-10335 | | | - | | | | - | |
| Hawthorn Pharmaceuticals, Inc. | | 19-10336 | | | - | | | | - | |
| Macoven Pharmaceuticals, L.L.C. | | 19-10334 | | | - | | | | - | |
| Pernix Holdco 1, LLC | | 19-10331 | | | - | | | | - | |
| Pernix Holdco 2, LLC | | 19-10332 | | | - | | | | - | |
| Pernix Holdco 3, LLC | | 19-10326 | | | - | | | | - | |
| Pernix Manufacturing, LLC | | 19-10328 | | | - | | | | - | |
| Pernix Sleep, Inc. | | 19-10323 | | | - | | | | - | |
| Respicopea, Inc. | | 19-10333 | | | - | | | | - | |
| Total | | | | $ | (31,265 | ) | | $ | (31,265 | ) |
Notes:
(1) The Schedule of Disbursements is presented on a book basis. The five entities included on the schedule represent all disbursements of the Debtors. The other remaining nine Debtor entities do not make disbursements.
(2) Pernix Therapeutics Holdings, Inc. disbursements includes the payoff of the pre-petition ABL and interest totaling $14,528,717.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR - 1b
Schedule of Debtor Bank Account Balances(1)
For the Period: February 18, 2019 - March 31, 2019 (Unaudited)
$ USD '000s
Debtor | | Bank | | Last Four Digits
Account No. | | Account Description | | Beginning
Balance
2/18/2019 | | Ending
Balance
3/31/2019 |
| Pernix Therapeutics LLC | | Wells Fargo | | 2816 | | Pernix zero-balance lockbox | | | - | | | | - | |
| Cypress Pharmaceuticals, Inc. | | Wells Fargo | | 5673 | | Cypress zero-balance lockbox | | | - | | | | - | |
| Pernix Therapeutics LLC | | Wells Fargo | | 2824 | | Pernix Operating | | | 2,723,540 | | | | 8,314,020 | |
| Cypress Pharmaceuticals, Inc. | | Wells Fargo | | 2865 | | Cypress Operating | | | 3,321,777 | | | | 4,754,921 | |
| Pernix Therapeutics Holdings, Inc. | | Wells Fargo | | 3388 | | Pernix Holdings | | | 5,138 | | | | 5,138 | |
| Pernix Ireland Pain Designated Activity Company | | Allied Irish Bank | | 3508 | | PIPDAC Operating | | | 166,138 | | | | 16,101 | |
| Pernix Ireland Limited | | Allied Irish Bank | | 8061 | | PIL Operating (EUR)(2) | | | 53,746 | | | | 55,108 | |
| Pernix Ireland Pain Designated Activity Company | | Allied Irish Bank | | 3187 | | PIPDAC Operating (EUR)(2) | | | 5,515 | | | | 3,069 | |
| Pernix Therapeutics LLC | | Wells Fargo | | 2840 | | Pernix Payroll | | | - | | | | - | |
| Pernix Therapeutics LLC | | Wells Fargo | | 2832 | | Pernix FSA | | | - | | | | - | |
| Macoven Pharmaceuticals LLC | | Wells Fargo | | 5186 | | Utility adequate assurance deposit | | | - | | | | 6,751 | |
| Pernix Therapeutics LLC | | Wells Fargo | | 0526 | | Nalpropion receipts escrow account | | | - | | | | 2,772,023 | |
| Total Bank Account Balances | | | | | | | | $ | 6,275,854 | | | $ | 15,927,130 | |
Notes:
(1) The Consolidated Schedule of Cash Receipts and Disbursements (MOR-1) and Schedule of Disbursements by Debtor Entity (MOR-1a) represent book balances while MOR-1b represents bank balances. The balances differ primarily due to the bank’s delayed recording of intrabank activity between the general checking and sweep accounts.
(2) The EUR accounts are presented in USD and translated at the daily FX rate based upon the statement date.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR - 1c
Schedule of Professional Fees and Expenses Paid
For the Period: February 18, 2019 - March 31, 2019
(Unaudited)
| | | | | | | | | | | 2/18/2019 - 3/31/2019 | | Cumulative Since Filing |
| Payee | | Category | | Payor | | Date | | Period Covered | | | Fees | | | | Expenses | | | | Fees | | | | Expenses | |
| Retained Professionals | | | | | | | | | | | | | | | | | | | | | | | | |
| Prime Clerk LLC | | Claims Agent | | Pernix Therapeutics, LLC | | 3/15/2019 | | 2/18/2019 - 2/28/2019 | | $ | 24,254 | | | $ | 29,102 | | | $ | 24,254 | | | $ | 29,102 | |
| Other Restructuring Professionals | | | | | | | | | | | | | | | | | | | | | | | | |
| Skadden, Arps, Slate, Meagher & Flom LLP | | DIP Lenders Counsel | | Pernix Therapeutics, LLC | | 3/11/2019 | | 1/1/2019 - 2/18/2019 | | | 861,451 | | | | 11,747 | | | | 861,451 | | | | 11,747 | |
| Ducera Partners LLC | | DIP Lenders Financial Advisor | | Pernix Therapeutics, LLC | | 3/18/2019 | | 3/1/2019 - 3/31/2019 | | | 100,000 | | | | 311 | | | | 100,000 | | | | 311 | |
| Total | | | | | | | | | | $ | 985,705 | | | $ | 41,160 | | | $ | 985,705 | | | $ | 41,160 | |
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR - 2
Statement of Operations
For the Period: February 18, 2019 - March 31, 2019
(Unaudited)
| $ USD '000s | | February 18 - March 31, 2019 |
| | | Pernix Therapeutics,
LLC | | Cypress
Pharmaceuticals, Inc. | | Pernix Ireland Limited | | Pernix Ireland Pain
Designated Activity
Company | | Intercompany Eliminations | | Pernix Therapeutics
Holdings, Inc. | | Total |
| | | | | | | | | | | | | | | |
| Net product sales | | $ | 6,920 | | | $ | 934 | | | $ | - | | | $ | 1,265 | | | $ | (1,265 | ) | | $ | - | | | $ | 7,854 | |
| Cost of product sales | | | (1,805 | ) | | | (1,397 | ) | | | (81 | ) | | | (1,272 | ) | | | 2,073 | | | | - | | | | (2,482 | ) |
| Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling, general and administrative | | | (5,541 | ) | | | (314 | ) | | | (1 | ) | | | (16 | ) | | | 210 | | | | (16 | ) | | | (5,679 | ) |
| Amortization of product rights | | | (12 | ) | | | (58 | ) | | | - | | | | (676 | ) | | | - | | | | - | | | | (746 | ) |
| Other operating expenses | | | (83 | ) | | | - | | | | - | | | | - | | | | - | | | | - | | | | (83 | ) |
| Total operating expenses | | | (5,637 | ) | | | (373 | ) | | | (1 | ) | | | (691 | ) | | | 210 | | | | (16 | ) | | | (6,508 | ) |
| Gain/(Loss)from operations | | | (521 | ) | | | (836 | ) | | | (82 | ) | | | (698 | ) | | | 1,018 | | | | (16 | ) | | | (1,135 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Other income/(expense): | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest income | | | - | | | | - | | | | - | | | | 43 | | | | (2,090 | ) | | | 2,090 | | | | 43 | |
| Interest expense | | | (4 | ) | | | - | | | | (2,090 | ) | | | (1,057 | ) | | | 2,090 | | | | (3,429 | ) | | | (4,489 | ) |
| Management fee income | | | 298 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 298 | |
| Other income/(expense) | | | 0 | | | | - | | | | (0 | ) | | | (0 | ) | | | - | | | | - | | | | | |
| Total other income (expenses) | | | 295 | | | | - | | | | (2,090 | ) | | | (1,014 | ) | | | - | | | | (1,339 | ) | | | (4,148 | ) |
| Net gain/(loss) | | | (226 | ) | | | (836 | ) | | | (2,172 | ) | | | (1,712 | ) | | | 1,018 | | | | (1,356 | ) | | | (5,283 | ) |
| Reorganization expenses | | | (302 | ) | | | - | | | | - | | | | - | | | | - | | | | - | | | | (302 | ) |
| Net gain/(loss) | | $ | (528 | ) | | $ | (836 | ) | | $ | (2,172 | ) | | $ | (1,712 | ) | | $ | 1,018 | | | $ | (1,356 | ) | | $ | (5,585 | ) |
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR - 3
Balance Sheet
(Unaudited)
| $ USD '000s | | As of March 31, 2019 |
| | | Pernix Therapeutics,
LLC(1) | | Cypress
Pharmaceuticals, Inc. | | Pernix Ireland Limited | | Pernix Ireland Pain
Designated Activity
Company | | Intercompany Eliminations | | Pernix Therapeutics
Holdings, Inc. | | Total |
| Assets | | | | | | | | | | | | | | |
| Current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cash and cash equivalents | | $ | 7,552 | | | $ | 4,754 | | | $ | 55 | | | $ | 19 | | | $ | - | | | $ | 5 | | | $ | 12,384 | |
| Restricted cash | | | 2,779 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 2,779 | |
| Accounts receivable, net | | | 25,742 | | | | 10,743 | | | | 106,007 | | | | 11,884 | | | | (117,891 | ) | | | - | | | | 36,486 | |
| Inventory | | | 4,645 | | | | 6,193 | | | | 168 | | | | - | | | | (6,941 | ) | | | - | | | | 4,065 | |
| Prepaid expenses and other current assets | | | 6,201 | | | | 83 | | | | 13 | | | | 486 | | | | (72,000 | ) | | | 72,586 | | | | 7,369 | |
| Intercompany receivable | | | 153,042 | | | | 8,963 | | | | (282,167 | ) | | | (7,251 | ) | | | - | | | | 130,655 | | | | 3,242 | |
| Total current assets | | | 199,962 | | | | 30,735 | | | | (175,924 | ) | | | 5,138 | | | | (196,832 | ) | | | 203,246 | | | | 66,324 | |
| Non-current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property and equipment, net | | | 421 | | | | 3 | | | | 10 | | | | - | | | | - | | | | - | | | | 434 | |
| Investments | | | - | | | | - | | | | - | | | | 4,428 | | | | (109,815 | ) | | | 109,815 | | | | 4,428 | |
| Intangible assets | | | 11,095 | | | | 2,875 | | | | 0 | | | | 39,556 | | | | - | | | | - | | | | 53,526 | |
| Goodwill | | | 196 | | | | 6,457 | | | | 2,825 | | | | 2,621 | | | | - | | | | - | | | | 12,100 | |
| Related party loan receivable | | | - | | | | - | | | | - | | | | 4,584 | | | | - | | | | - | | | | 4,584 | |
| Other long-term assets | | | 190 | | | | - | | | | - | | | | - | | | | - | | | | 1,339 | | | | 1,529 | |
| Total assets | | $ | 211,864 | | | $ | 40,070 | | | $ | (173,089 | ) | | $ | 56,326 | | | $ | (306,648 | ) | | $ | 314,401 | | | $ | 142,925 | |
| Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accounts payable | | | 2,811 | | | | 693 | | | | 72 | | | | 2 | | | | - | | | | - | | | | 3,578 | |
| Accrued expenses | | | 42,053 | | | | 11,780 | | | | 81 | | | | - | | | | - | | | | - | | | | 53,913 | |
| Related party payable | | | 3,641 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 3,641 | |
| Other liabilities | | | 838 | | | | - | | | | 296 | | | | - | | | | - | | | | - | | | | 1,134 | |
| DIP loan | | | - | | | | - | | | | - | | | | - | | | | - | | | | 18,529 | | | | 18,529 | |
| Total current liabilities: | | | 49,342 | | | | 12,473 | | | | 449 | | | | 2 | | | | - | | | | 18,529 | | | | 80,794 | |
| Total liabilities not subject to compromise | | | 49,342 | | | | 12,473 | | | | 449 | | | | 2 | | | | - | | | | 18,529 | | | | 80,794 | |
| Total liabilities subject to compromise | | | 124,794 | | | | 16,106 | | | | 72,586 | | | | 52,627 | | | | (189,891 | ) | | | 236,017 | | | | 312,239 | |
| Stockholders' equity/(deficit) | | | 37,728 | | | | 11,491 | | | | (246,124 | ) | | | 3,697 | | | | (116,756 | ) | | | 59,856 | | | | (250,109 | ) |
| Total liabilities and stockholders' equity/(deficit) | | $ | 211,864 | | | $ | 40,070 | | | $ | (173,089 | ) | | $ | 56,326 | | | $ | (306,648 | ) | | $ | 314,401 | | | $ | 142,925 | |
Notes:
(1) The Pernix Therapeutics, LLC with Pernix Sleep, LLC intercompany transaction is not included in the above balance sheet presentation. This analysis was completed in connection with the SOFAs/SOALs filed on April 2, 2019. However, to be aligned with the Company’s books and records this was not completed for the MOR.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR – 3
Balance Sheet
(Unaudited)
| $ USD '000s | | As of February 17, 2019 |
| | | Pernix Therapeutics,
LLC(1) | | Cypress
Pharmaceuticals, Inc. | | Pernix Ireland
Limited | | Pernix Ireland Pain
Designated Activity
Company | | Intercompany
Eliminations | | Pernix Therapeutics
Holdings, Inc. | | Total |
| Assets | | | | | | | | | | | | | | |
| Current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cash and cash equivalents | | $ | 2,724 | | | $ | 3,322 | | | $ | 54 | | | $ | 172 | | | $ | - | | | $ | 5 | | | $ | 6,276 | |
| Restricted cash | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Accounts receivable, net | | | 25,288 | | | | 12,459 | | | | 106,007 | | | | 10,619 | | | | (116,626 | ) | | | - | | | | 37,747 | |
| Inventory | | | 5,335 | | | | 7,309 | | | | 168 | | | | - | | | | (7,960 | ) | | | - | | | | 4,852 | |
| Prepaid expenses and other current assets | | | 6,840 | | | | 83 | | | | 14 | | | | 641 | | | | (69,911 | ) | | | 70,503 | | | | 8,171 | |
| Intercompany receivable | | | 155,249 | | | | 9,200 | | | | (282,167 | ) | | | (5,972 | ) | | | - | | | | 126,786 | | | | 3,095 | |
| Total current assets | | | 195,437 | | | | 32,372 | | | | (175,924 | ) | | | 5,459 | | | | (194,496 | ) | | | 197,294 | | | | 60,142 | |
| Non-current assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property and equipment, net | | | 500 | | | | 3 | | | | 10 | | | | - | | | | - | | | | - | | | | 513 | |
| Investments | | | - | | | | - | | | | - | | | | 4,428 | | | | (109,815 | ) | | | 109,815 | | | | 4,428 | |
| Intangible assets | | | 11,108 | | | | 2,933 | | | | 0 | | | | 40,231 | | | | - | | | | - | | | | 54,272 | |
| Goodwill | | | 196 | | | | 6,457 | | | | 2,825 | | | | 2,621 | | | | - | | | | - | | | | 12,100 | |
| Related party loan receivable | | | - | | | | - | | | | - | | | | 4,584 | | | | - | | | | - | | | | 4,584 | |
| Other long-term assets | | | 190 | | | | - | | | | - | | | | - | | | | - | | | | 1,407 | | | | 1,597 | |
| Total assets | | $ | 207,430 | | | $ | 41,766 | | | $ | (173,089 | ) | | $ | 57,324 | | | $ | (304,311 | ) | | $ | 308,516 | | | $ | 137,636 | |
| Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accounts payable | | $ | 150 | | | $ | - | | | $ | 71 | | | $ | 399 | | | $ | - | | | $ | - | | | | 620 | |
| Accrued expenses | | | 38,944 | | | | 12,922 | | | | - | | | | - | | | | - | | | | - | | | | 51,866 | |
| Related party payable | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Other liabilities | | | 913 | | | | - | | | | 296 | | | | - | | | | - | | | | - | | | | 1,209 | |
| DIP loan | | | - | | | | - | | | | - | | | | - | | | | - | | | | 14,185 | | | | 14,185 | |
| Total current liabilities: | | | 40,007 | | | | 12,922 | | | | 367 | | | | 399 | | | | - | | | | 14,185 | | | | 67,880 | |
| Total liabilities not subject to compromise | | | 40,007 | | | | 12,922 | | | | 367 | | | | 399 | | | | - | | | | 14,185 | | | | 67,880 | |
| Total liabilities subject to compromise | | | 129,171 | | | | 16,517 | | | | 70,496 | | | | 51,515 | | | | (186,537 | ) | | | 233,120 | | | | 314,283 | |
| Stockholders' equity/(deficit) | | | 38,253 | | | | 12,327 | | | | (243,952 | ) | | | 5,409 | | | | (117,775 | ) | | | 61,211 | | | | (244,527 | ) |
| Total liabilities and stockholders' equity/(deficit) | | $ | 207,430 | | | $ | 41,766 | | | $ | (173,089 | ) | | $ | 57,324 | | | $ | (304,311 | ) | | $ | 308,516 | | | $ | 137,636 | |
Notes:
(1) The Pernix Therapeutics, LLC with Pernix Sleep, LLC intercompany transaction is not included in the above balance sheet presentation. This analysis was completed in connection with the SOFAs/SOALs filed on April 2, 2019. However, to be aligned with the Company’s books and records this was not completed for the MOR.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR-4
Summary of Unpaid Post Petition Accounts Payables
As of March 31, 2019
(Unaudited)
$ USD '000s | | | | | | | | | | | | |
| | | Number of Days Past Due |
| Post Petition Accounts Payable Aging | | Current | | 0-30(2) | | 31-60 | | 61-90 | | Over 90 | | Total |
| Post-Petition Accounts Payable(1) | | $ | 1,655 | | | $ | 2 | | | $ | - | | | $ | - | | | $ | - | | | $ | 1,657 | |
| | $ | 1,655 | | | $ | 2 | | | $ | - | | | $ | - | | | $ | - | | | $ | 1,657 | |
Notes:
(1) The above figures represent post petition trade payables recorded in the Debtors’ subledger.
(2) The $2K amount that was past due at March 31, 2019 was due to an ordinary course professional that was not yet approved to be paid.
| In re: Pernix Sleep, Inc. et al. | Case No. 19-10323 (CSS) |
| Debtors | Reporting Period: February 18, 2019 - March 31, 2019 |
MOR-5
Accounts Receivable Aging
As of March 31, 2019
(Unaudited)
$ USD '000s | | | | | | | | | | | | |
| | | Number of Days Past Due |
| Accounts Receivable Aging | | Current | | 0-30 Days | | 31-60 Days | | 61-90 Days | | 91 Days+ | | Total |
| Accounts Receivable, net | | $ | 21,206 | | | $ | 11,953 | | | $ | 1,595 | | | $ | 1,475 | | | $ | 257 | | | $ | 36,486 | |
| | $ | 21,206 | | | $ | 11,953 | | | $ | 1,595 | | | $ | 1,475 | | | $ | 257 | | | $ | 36,486 | |
Debtor Questionnaire
| Must be completed each month | 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 post petition 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:
1) The Debtors sold office furniture and fixtures in connection with ending the South Carolina office space lease.
5) Wells Fargo account 0526 was opened during this period as an escrow account to hold Nalpropion operating receipts.
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re: PERNIX SLEEP, INC.,et al.1 Debtors. | Chapter 11 Case No. 19-10323 (CSS) Jointly Administered |
AFFIDAVIT OF SERVICE
| STATE OF DELAWARE | ) | |
| | ) | SS |
| NEW CASTLE COUNTY | ) | |
Melissa Ramirez, being duly sworn according to law, deposes and says that she is employed by the law firm of Landis Rath & Cobb LLP, Delaware counsel to the Debtors and Debtors in Possession in the above referenced case, and on the 1st day of May, 2019, she caused a copy of the following:
MONTHLY OPERATING REPORT
February 18, 2019 through March 31, 2019
to be served upon the party identified below in the manner so indicated;
Via Hand Delivery
Office of the U.S. Trustee
Attn: Benjamin Hackman, Esquire
844 N. King Street
Suite 2207, Lockbox 35
Wilmington, DE 19801
| /s/ Melissa Ramirez |
| Melissa Ramirez |
SWORN TO AND SUBSCRIBED before me this 1st day of May, 2019.
| /s/ Darcy Snyder |
| Notary Public |
| My Commission Expires:11-16-2020 |
1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number, where applicable, are: Pernix Therapeutics Holdings, Inc. (4736), Pernix Therapeutics, LLC (1128), Pernix Manufacturing, LLC (1236), Pernix Sleep, Inc. (1599), Cypress Pharmaceuticals, Inc. (1860), Hawthorn Pharmaceuticals, Inc. (2769), Macoven Pharmaceuticals, L.L.C. (4549), Gaine, Inc. (3864), Respicopea, Inc. (1303), Pernix Ireland Limited (3106PH), Pernix Ireland Pain Designated Activity Company (0190LH), Pernix Holdco 1, LLC, Pernix Holdco 2, LLC, Pernix Holdco 3, LLC.
