SEC Filings

8-K
PERNIX THERAPEUTICS HOLDINGS, INC. filed this Form 8-K on 06/26/2019
Entire Document
 

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: April 1, 2019 -April 30, 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/ Garineh Dovletian   June 10, 2019
Signature of Authorized Individual*   Date

 

Garineh Dovletian   Wind Down 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: April 1, 2019 - April 30, 2019

 

CERTIFICATION REGARDING POST-PETITION BANK ACCOUNT
RECONCILIATIONS, CASH DISBURSEMENT JOURNALS AND
COMPLIANCE AND PAYMENT OF POST-PETITION TAXES

 

I, Garineh Dovletian, Wind Down 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/ Garineh Dovletian   June 10, 2019
Garineh Dovletian   Date
Wind Down Officer    

 

 

 

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 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.

 

Sale Transaction

 

On February 19, 2019, the Debtor entered into an asset purchase agreement with Highbridge Capital Management, LLC (the "Buyer") for the sale of substantially all of its assets through section 363 of the Bankruptcy Code. This transaction was

 

3

 

subsequently approved by the Bankruptcy Court on April 15, 2019. On April 30, 2019, the Debtor closed the sale and transferred substantially all of its assets to the Buyer. As part of the sale, the Debtor entered into a transition services agreement for the post-closing period through the effective date of a Plan of Liquidation. On April 22, 2019, the Debtors filed a Plan of Liquidation and the Disclosure Statement was approved on an interim basis on May 6, 2019. The Confirmation hearing is scheduled for June 20, 2019.

 

4

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR – 1
Consolidated Schedule of Cash Receipts and Disbursements (1)
For the Period: April 1, 2019 - April 30, 2019
(Unaudited)

 

$ US '000s  April 1, 2019 – April 30, 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)  $7,552   $4,754   $55   $19   $5   $12,384 
Receipts                              
Operating Receipts  $13,850   $1,198   $-   $91   $-    15,138 
Miscellaneous Receipts   14,141    -    -    -    -    14,141 

Total Receipts

 

   27,990   $1,198    -    91    -    29,279 
Operating Disbursements                              
Payroll & Benefits   (857)   -    -    -    -    (857)
Gross to Net Disbursements   (3,883)   (784)   -    -    -    (4,667)
Inventory   (547)   (1,076)   -    -    -    (1,622)
Royalties   -    -    -    -    -    - 
Insurance   (77)   -    -    -    -    (77)
Nalpropion   (3,034)   -         -    -    (3,034)
Other G&A   (803)   (4,092)   (55)   (110)   (5)   (5,065)

Total Operating Disbursements

   (9,201)   (5,952)   (55)   (110)   (5)   (15,323)
Operating Cash Flow   18,789    (4,754)   (55)   (19)   (5)   13,956 
Debt Service                              
ABL   -    -    -    -    -    - 
Trex Notes   (5,000)   -    -    -    -    (5,000)
Total Debt Service   (5,000)   -    -    -    -    (5,000)
Restructuring Costs                              
DIP Loan Interest and Fees   (168)   -    -    -    -    (168)
Professional Fees   (8,339)   -    -    -    -    (8,339)
DIP Paydown   (4,000)   -    -              (4,000)

Total Non-Operating Disbursements 

   (12,507)   -    -    -    -    (12,507)
                               

Total Disbursements 

  $(26,708)  $(5,952)  $(55)  $(110)  $(5)  $(32,830)
Net Cash Flow  $1,282   $(4,754)  $(55)   (19)   (5)  $(3,551)
DIP Draw   5,812    -    -    -    3,600    9,412 

Nalpropion Escrow Transfer 

   (8,789)   -    -    -         (8,789)
Ending Cash Balance (Book)  $5,857   $-   $0   $-   $3,600   $9,456 
Nalpropion Escrow Account Cash Balance  $11,561   $-   $-   $-   $-   $11,561 

 

Notes: 

(1) The Schedule of Cash Receipts and Disbursements is presented on a book basis. 

(2) The above cash receipts and disbursements include activity relating to the close of the sale of the Debtors’ assets to Currax USA Holdings LLC on 4/30/2019

 

5

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR – 1
Consolidated Schedule of Cash Receipts and Disbursements (1)
For the Period: April 1, 2019 - April 30, 2019
(Unaudited)

 

$ US '000s  April 1, 2019 – April 30, 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  $33,074   $3,589   $2   $91   $-    36,755 
Miscellaneous Receipts   14,141    -    -    -    -    14,141 

Total Receipts

 

   47,214   $3,589    2    91    -    50,896 
Operating Disbursements                              
Payroll & Benefits   (1,958)   -    -    -    -    (1,958)
Gross to Net Disbursements   (14,828)   (1,251)   -    -    -    (16,079)
Inventory   (2,120)   (1,512)   -    (150)   -    (3,782)
Royalties   (156)   -    -    -    -    (156)
Insurance   (309)   -    -    -    -    (309)
Nalpropion   (3,034)   -         -    -    (3,034)
Other G&A   (1,262)   (4,148)   (56)   (112)   (5)   (5,583)

Total Operating Disbursements

 

   (23,668)   (6,911)   (56)   (262)   (5)   (30,902)
Operating Cash Flow   23,546    (3,322)   (54)   (172)   (5)   19,994 
Debt Service                              
ABL   -    -    -    -    (14,529)   (14,529)
Trex Notes   (5,000)   -    -    -    -    (5,000)
Total Debt Service   (5,000)   -    -    -    (14,529)   (19,529)
Restructuring Costs                              
DIP Loan Interest and Fees   (299)   -    -    -    -    (299)
Professional Fees   (9,366)   -    -    -    -    (9,366)
DIP Paydown   (4,000)   -    -              (4,000)

Total Non-Operating Disbursements 

   (13,664)   -    -    -    -    (13,664)
                               

Total Disbursements

  $(42,332)  $(6,911)  $(56)  $(262)  $(14,534)  $(64,095)
Net Cash Flow  $4,882   $(3,322)  $(54)   (172)   (14,534)  $(13,199)
DIP Draw   9,812    -    -    -    18,129    27,941 

Nalpropion Escrow Transfer 

   (11,651)   -    -    -         (11,561)
Ending Cash Balance (Book)  $5,857   $-   $0   $-   $3,600   $9,457 
Nalpropion Escrow Account Cash Balance  $11,561   $-   $-   $-   $-   $11,561 

 

Notes:

(1) The Schedule of Cash Receipts and Disbursements is presented on a book basis. 

(2) The above cash receipts and disbursements include activity relating to the close of the sale of the Debtors’ assets to Currax USA Holdings LLC on 4/30/2019

 

6

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 -April 30, 2019

MOR – la
Schedule of Disbursements by Debtor Entity(1)
For the Period: April 1, 2019 -April 30, 2019
(Unaudited)

 

$ USD '000s
Debtors
Case Number April 1, 2019 – April 30, 2019 Cumulative
Since Filing
Pernix Therapeutics, LLC 19-10329 $(26,708) $(42,332)
Cypress Pharmaceuticals, Inc. 19-10330  (5,952)  (6,911)
Pernix Ireland Limited 19-10325  (55)  (56)
Pernix Ireland Pain Designated Activity Company 19-10327  (110)  (262)
Pernix Therapeutics Holdings, Inc.(2) 19-10324  (5)  (14,534)
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   $(32,830) $(64,095)

 

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.

 

7

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 -April 30, 2019

 

MOR - 1b
Schedule of Debtor Bank Account Balances (1)
For the Period: April 1, 2019 -April 30, 2019
(Unaudited)

 

$ USD '000s
Debtor
Bank Last Four Digits
Account No.
Account Description Beginning
Balance
4/1/2019
Ending
Balance
4/30/2019
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  8,314,020   - 
Cypress Pharmaceuticals, Inc. Wells Fargo 2865 Cypress Operating  4,754,921   - 
Pernix Therapeutics Holdings, Inc. Wells Fargo 3388 Pernix Holdings  5,138   3,600,000 
Pernix Ireland Pain Designated Activity Company Allied Irish Bank 3508 PIPDAC Operating  16,101   475 
Pernix Ireland Limited Allied Irish Bank 8061 PIL Operating (EUR)(2)  55,108   346 
Pernix Ireland Pain Designated Activity Company Allied Irish Bank 3187 PIPDAC Operating (EUR)(2)  3,069   346 
Pernix Therapeutics LLC Wells Fargo 2840 Pernix Payroll  -   5,871,619 
Pernix Therapeutics LLC Wells Fargo 2832 Pernix FSA  -   - 
Macoven Pharmaceuticals LLC Wells Fargo 5186 Utility adequate assurance deposit  6,751   2,696,999 
Pernix Therapeutics LLC Wells Fargo 0526 Nalpropion receipts escrow account  2,772,023   810,227 
Total Bank Account Balances       $15,927,130  $12,980,013 

 

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.

 

8

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR - 1c
Schedule of Professional Fees and Expenses Paid
For the Period: April 1, 2019 -April 30, 2019
(Unaudited)

 

           4/1/2019-4/30/2019   

Cumulative Since Filing

 
Payee Category Payor Date Period Covered  Fees   Expenses   Fees   Expenses 
Retained Professionals                        
Prime Clerk LLC Claims Agent Pernix Therapeutics, LLC 4/25/2019 2/18/2019 - 3/31/2019 $38,324  $51,426  $65,149  $77,957 
Other Restructuring Professionals                        
Skadden, Arps, Slate, Meagher & Flom LLP DIP Lenders Counsel Pernix Therapeutics, LLC 4/29/2019 1/1/2019 - 3/31/2019  350,280   6,089   1,211,731   17,836 
Ducera Partners LLC DIP Lenders Financial Advisor Pernix Therapeutics, LLC 4/15/2019 3/1/2019 - 3/31/2019  100,000   718   200,000   1,029 
Total         $488,604  $58,233  $1,476,880  $96,823 

 

9

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR - 2
Statement of Operations
For the Period: April 1, 2019 -April 30, 2019
(Unaudited)

 

$ USD '000s  April 1 -April 30, 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  $5,131   $1,659   $-   $-   $-   $-   $6,791 
Cost of product sales   (693)   (1,456)   (60)   -    990    -    (1,219)
Operating expenses:                                   
Selling, general and administrative   (1,339)   (193)   (156)   (46)   159    (147)   (1,411)
Amortization of product rights   (9)   (42)   -    (319)   -    -    (369)
Other operating expenses   (23)   -    -    -    -    -    (23)
Total operating expenses   (1,370)   (235)   (156)   (365)   159    (147)   (1,803)
Gain/(Loss)from operations   (3,068)   (32)   (96)   (365)   1,149    (147)   (3,769)
Other income/(expense):                                   
Interest income   -    -    -    30    (1,500)   1,500    30 
Interest expense   (2)   -    (1,500)   (767)   1,500    (2,457)   (3,226)
Management fee income   269    -    -    -    -    -    269 
Other income/(expense)   0    -    0    1    -    -      
Total other income (expenses)   267    -    (1,500)   (736)   -    (957)   (2,927)
Net gain/(loss)   3,335    (32)   (1,404)   (1,101)   1,149    (1,104)   (842)
Reorganization expenses   (6,386)   -    -    -    -    -    (6,386)
Net gain/(loss)  $(3,051)  $(32)  $(1,404)  $(1,101)  $1,149   $(1,104)  $(5,544)

 

10

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR - 2
Statement of Operations
For the Period: April 1, 2019 -April 30, 2019
(Unaudited)

 

$ USD '000s  April 1 -April 30, 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  $12,051   $2,594   $-   $1,265   $(1,265)  $-   $14,645 
Cost of product sales   (2,497)   (2,854)   (141)   (1,272)   3,064    -    (3,700)
Operating expenses:                                   
Selling, general and administrative   (3,712)   (507)   155    (62)   369    (163)   (3,921)
Amortization of product rights   (21)   (100)   -    (995)   -    -    (1,115)
Other operating expenses   (106)   -    -    -    -    -    (106)
Total operating expenses   (3,838)   (607)   (155)   (1,057)   369    (163)   (5,142)
Gain/(Loss)from operations   (5,715)   (868)   (14)   (1,064)   2,167    (163)   (5,802)
Other income/(expense):                                   
Interest income   -    -    -    73    (3,500)   3,590    73 
Interest expense   (5)   -    (3,590)   (1,824)   3,590    (5,886)   (7,715)
Management fee income   567    -    -    -    -    -    567 
Other income/(expense)   0    -    (0)   1    -    -      
Total other income (expenses)   562    -    (3,590)   (1,750)   -    (2,296)   (7,075)
Net gain/(loss)   6,277    (868)   (3,576)   (2,814)   2,167    (2,460)   (1,273)
Reorganization expenses   (9,856)   -    -    -    -    -    (9,856)
Net gain/(loss)  $(3,578)  $(868)  $(3,576)  $(2,814)  $2,167   $(2,460)  $(11,128)

 

Notes:

(1) Some expenses categorized as Selling, general and administrative in the February 18 -March 31, 2019 monthly operating report have since been reclassified as Reorganization expenses in the cumulative Statement of Operations.

 

11

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR - 3
Balance Sheet
(Unaudited)

 

$ USD '000s  As of April 30, 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  $5,857   $(0)  $0   $1   $-   $3,600   $9,458 
Restricted cash   7,661    -    -    -    -    -    7,661 
Accounts receivable, net   -    -    106,007    11,884    (117,891)   -    (0)
Inventory   -    -    -    -    -    -    - 
Prepaid expenses and other current assets   3,609    (211)   0    142    (73,500)   74,084    4,124 
Intercompany receivable   139,358    12,947    (282,160)   (7,279)   -    137,134    (0)
Total current assets   156,485    12,736    (176,152)   4,747    (191,391)   214,818    21,243 
Non-current assets:                                   
Property and equipment, net   -    -    -    -    -    -    - 
Investments   -    -    -    -    (109,815)   109,815    - 
Intangible assets   -    -    -    -    -    -    - 
Goodwill   -    -    -    -    -    -    - 
Related party loan receivable   -    -    -    -    -    -    - 
Other long-term assets   190    -    -    -    -    1,291    1,481 
Total assets  $156,675   $12,736   $(176,152)  $4,747   $(301,206)  $325,924   $22,724 
Liabilities and Stockholders' Equity                                   
Current liabilities:                                   
Accounts payable  $408   $-   $-   $-   $-   $-    408 
Accrued expenses   1,918    -    130    -    -    -    2,049 
Related party payable   0    -    -    -    -    -    0 
Other liabilities   590    -    100    -    -    -    690 
DIP loan   -    -    -    -    -    10,290    10,290 
Total current liabilities:   2,916    -    230    -    -    10,290    13,437 
Total liabilities not subject to compromise   2,916    -    230    -    -    10,290    13,437 
Total liabilities subject to compromise   111,682    15,314    74,067    14,558    (191,391)   233,261    257,491 
Stockholders' equity/(deficit)   42,076    (2,578)   (250,449)   (9,812)   (109,815)   82,373    (248,204)
Total liabilities and stockholders' equity/(deficit)  $156,675   $12,736   $(176,152)  $4,747   $(301,206)  $325,924   $22,724 

 

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. 

(2) The DIP loan balance is after the application of the closing credit bid pursuant to the APA and the $4 million partial cash payment at APA Closing.

 

12

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 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.

 

13

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 -April 30, 2019

 

MOR-4
Summary of Unpaid Post Petition Accounts Payables
As of April 30, 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)  $393   $16   $0   $-   $-   $408 
  $393   $16   $0   $-   $-   $408 

 

Notes:

(1) The above figures represent post petition trade payables recorded in the Debtors’ subledger. 

(2) The entire past due amounts were due to ordinary course professionals that were not yet approved to be paid. 

(3) Excludes intercompany accouts payable.

 

14

 

In re: Pernix Sleep, Inc. et al. Case No. 19-10323 (CSS)
Debtors Reporting Period: April 1, 2019 - April 30, 2019

 

MOR-5
Accounts Receivable Aging
As of April 30, 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  $-   $-   $-   $-   $-   $- 
$-       $-   $-   $-   $-   $- 

 

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 363 sales transaction of substantially all Debtors' assets closed on April 30, 2019. See Docket #0321 for the Order approving the sale.

 

15

 

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.