|
ý
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
33-0857544
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification No.)
|
6340 Sequence Drive
San Diego, California
|
|
92121
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Title of Each Class
|
|
Name of Each Exchange on Which Registered
|
Common Stock, $0.001 Par Value Per Share
|
|
The NASDAQ Stock Market LLC
(Nasdaq Global Select Market)
|
Preferred Stock Purchase Rights
|
|
The NASDAQ Stock Market LLC
(Nasdaq Global Select Market)
|
Class
|
|
Outstanding at February 20, 2015
|
Common stock, $0.001 par value per share
|
|
77,514,635 shares
|
|
|
|
|
|
|
Page
Number
|
PART I
|
||
|
|
|
ITEM 1.
|
Business
|
|
|
|
|
ITEM 1A.
|
Risk Factors
|
|
|
|
|
ITEM 1B.
|
Unresolved Staff Comments
|
|
|
|
|
ITEM 2.
|
Properties
|
|
|
|
|
ITEM 3.
|
Legal Proceedings
|
|
|
|
|
ITEM 4.
|
Mine Safety Disclosures
|
|
|
|
|
|
|
|
PART II
|
|
|
ITEM 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
|
|
|
|
ITEM 6.
|
Selected Financial Data
|
|
|
|
|
ITEM 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
|
|
ITEM 7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
|
|
|
|
ITEM 8.
|
Consolidated Financial Statements and Supplementary Data
|
|
|
|
|
ITEM 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
|
|
|
|
ITEM 9A.
|
Controls and Procedures
|
|
|
|
|
ITEM 9B.
|
Other Information
|
|
|
|
|
PART III
|
|
|
|
|
|
ITEM 10.
|
Directors, Executive Officers and Corporate Governance
|
|
|
|
|
ITEM 11.
|
Executive Compensation
|
|
|
|
|
ITEM 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters
|
|
|
|
|
ITEM 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
|
|
|
|
ITEM 14.
|
Principal Accounting Fees and Services
|
|
|
|
|
PART IV
|
|
|
|
|
|
ITEM 15.
|
Exhibits, Financial Statement Schedules
|
ITEM 1.
|
BUSINESS
|
•
|
an improved sensor wire design that allows more scalable manufacturing,
|
•
|
a smaller, sleeker receiver that is capable of displaying data in color,
|
•
|
a new transmitter design that offers improved communication range with the receiver which allows for improved data capture,
|
•
|
additional user interface and algorithm enhancements that are intended to make the user experience more customizable and to make its glucose monitoring function more accurate especially in the hypoglycemic range, and
|
•
|
the ability to market and sell to an expanded customer population due to the approval by the
FDA
of, and our obtaining a
CE Mark
for, a
Pediatric Indication
.
|
•
|
Limited Information.
Even if people with diabetes test several times each day, each measurement represents a single blood glucose value at a single point in time. Given the many factors that can affect blood glucose levels, excursions above and below the normal range often occur between these discrete measurement points in time. Because people with diabetes only have single-point data, they do not gain sufficient information to indicate the direction or rate of change in their blood glucose levels. Without the ability to determine whether their blood glucose level is rising, falling or holding constant, and the rate at which their blood glucose level is changing, the individual’s ability to effectively manage and maintain blood glucose levels within normal ranges is severely limited. Further, people with diabetes cannot test themselves during sleep, when the risk of hypoglycemia is significantly increased. In addition, existing technology generally limits individuals’ ability to store their glucose data in servers or systems independent of the blood glucose meter.
|
•
|
Inconvenience.
The process of measuring blood glucose levels with single-point finger stick devices can cause significant disruption in the daily activities of people with diabetes and their families. People with diabetes using single-point finger stick devices must stop whatever they are doing several times per day, self-inflict a painful prick and draw blood to measure blood glucose levels. To do so, people with diabetes must always carry a fully supplied kit that may include a spring-loaded needle, or lancet, disposable test strips, cleansing wipes, and the meter, and then safely dispose of the used supplies. This process is inconvenient and may cause uneasiness in social situations.
|
•
|
Difficulty of Use.
To obtain a sample with single-point finger stick devices, people with diabetes generally prick one of their fingertips or, occasionally, a forearm with a lancet. They then squeeze the area to produce the blood sample and another prick may be required if a sufficient volume of blood is not obtained the first time. The blood sample is then placed on a disposable test strip that is inserted into a blood glucose meter. This task can be difficult for individuals with decreased tactile sensation and visual acuity, which are common complications of diabetes.
|
•
|
Pain.
Although the fingertips are rich in blood flow and provide a good site to obtain a blood sample, they are also densely populated with highly sensitive nerve endings. This makes the lancing and subsequent manipulation of the finger to draw blood painful. The pain and discomfort are compounded by the fact that fingers offer limited surface area, so tests are often performed on areas that are sore from prior tests. People with diabetes may also suffer pain when the finger prick site is disturbed during regular activities.
|
•
|
Improved Outcomes.
Data published in a peer-reviewed article based on our approval support trial for our first system demonstrated that patients using the system showed statistically significant improvements in maintaining their glucose levels within the target range when compared to patients relying solely on single-point finger stick measurements. Additional peer-review published data from our trial for the SEVEN demonstrated that patients with access to seven days of continuous glucose data statistically improved glucose control by further increasing their time spent with glucose levels in the target range, thereby reducing time spent in both hyperglycemic and hypoglycemic ranges. Peer-review published data from our repeated use trial demonstrated a statistically significant reduction in hemoglobin A1c levels, a measure of the average amount of glucose in the blood over the prior three months, in patients using our system compared to patients relying solely on single-point finger stick measurements. Finally, results of a major multicenter clinical trial funded by the
JDRF
demonstrated that patients with Type 1 diabetes who used continuous glucose monitoring devices to help manage their disease experienced significant improvements in glucose control.
|
•
|
Access to Real-Time Values, Trend Information and Alerts.
At the push of a button, people with diabetes can view their current glucose value, along with a graphical display of one-, three-, six-, twelve- or twenty-four-hour trend information. Without continuous monitoring, the individual is often unaware if his or her glucose is rising, declining or remaining constant. Access to continuous real-time glucose measurements provides people with diabetes information that may aid in attaining better glucose control. Additionally, our G4 PLATINUM alerts people with diabetes when their glucose levels approach inappropriately high or low levels so that they may intervene.
|
•
|
Intuitive User Interface.
We have developed a user interface that we believe is intuitive and easy to use. The G4 PLATINUM receiver’s compact design includes user-friendly buttons, an easy-to-read color display, simple navigation tools, audible alerts and graphical display of trend information.
|
•
|
Convenience and Comfort.
Our G4 PLATINUM provides people with diabetes with the benefits of continuous monitoring, without having to perform finger stick tests for every measurement. Additionally, the disposable sensor electrode that is inserted under the skin is a very thin wire, minimizing potential discomfort associated with inserting or wearing the disposable sensor. The external portion of the sensor, including the transmitter, is small, has a low profile and is designed to be easily worn under clothing. The wireless receiver is the size of a small digital music player and can be carried discreetly in a pocket or purse. We believe that convenience is an important factor in achieving widespread adoption of a continuous glucose monitoring system.
|
•
|
Connectivity to Others.
Our Share remote monitoring systems enable users of our G4 PLATINUM System to have their sensor glucose information remotely monitored by their family or friends by wirelessly transmitting data through an app on the patient’s smart phone. Up to five designated recipients, or “followers,” can remotely monitor a patient’s glucose information and receive secondary alert notifications from almost anywhere via each follower's smart phone.
|
•
|
Establish our technology platform as the leading approach to continuous glucose monitoring and leverage our development expertise to rapidly bring products to market.
We have developed proprietary core technology and expertise that provides a broad platform for the development of innovative products for continuous glucose monitoring. We received approval from the
FDA
and commercialized our first product in 2006. In 2007, we received approval and began commercializing our second generation system, the SEVEN. In 2009 we received approval and began commercializing our third generation system, the SEVEN PLUS. On October 5, 2012, we received approval from the
FDA
for our fourth generation system, the DexCom G4 PLATINUM, which is designed for up to seven days of continuous use, and we began commercializing this product in the U.S. in the fourth quarter of 2012. On January 23, 2015, we received approval from the FDA for the DexCom G4 PLATINUM with Share, which is designed for up to seven days of continuous use, and we will begin commercializing this product in the U.S. in the first quarter of 2015. We plan to continue to invest in the development of our technology platform and to obtain additional
FDA
approvals for our continuous glucose monitoring systems for both the ambulatory and in-hospital markets as well as for our integrated insulin pump delivery systems. We expect to continue to provide performance improvements, expanded indications and introduce new products to establish and maintain a leadership position in the market. In the future, we may develop our technology to support applications beyond glucose sensing.
|
•
|
Drive the adoption of our ambulatory products through a direct sales and marketing effort.
We have a small direct field sales force to call on endocrinologists, physicians and diabetes educators who can educate and influence patient adoption of continuous glucose monitoring. In addition, the
FDA
’s approval of a
Pediatric Indication
for the G4 PLATINUM in February 2014 allows our direct field sales force to call on pediatric endocrinologists and pediatricians who can educate and influence parents to adopt continuous glucose monitoring for their children aged two years or older with diabetes. We believe that focusing efforts on these participants is important given the instrumental role they each play in the decision-making process for diabetes therapy. To complement our sales efforts, we have entered into distribution arrangements that allow distributors to sell our G4 PLATINUM. We currently sell the G4 PLATINUM only in the United States, Canada, Australia, New Zealand and in portions of Europe, Asia, Latin America and the Middle East, but plan to expand our sales elsewhere in the future.
|
•
|
Drive additional adoption through technology integration partnerships.
We have development agreements with Animas and
Tandem
that have and will develop products that integrate our ambulatory product technology into the
Animas
conventional insulin pump, and the
Tandem
t:slim system, as applicable, enabling the partner’s insulin pump to receive glucose readings from our transmitter and display this information on the pump’s screen. We believe people with diabetes who have adopted
continuous subcutaneous insulin infusion (“CSII”)
are individuals who more aggressively manage their diabetes and may be more inclined to utilize our continuous glucose monitoring systems.
|
•
|
Seek broad coverage policies and reimbursement for our products.
Our approved products are not reimbursed by virtue of a national coverage decision by Medicare. As of
February 25, 2015
, the seven largest private third-party payors, in terms of the number of covered lives, have issued coverage policies for the category of continuous glucose monitoring devices. Many of these coverage policies, however, are restrictive in nature and require the policy holder to comply with extensive documentation and other requirements to demonstrate medical necessity under the policy. We have negotiated contracted rates with six of those third-party payors for the purchase of our products by their members. We currently employ in-house reimbursement expertise to assist people with diabetes in obtaining reimbursement from private third-party healthcare payors. We also maintain a field-based reimbursement team charged with calling on third-party private payors to obtain coverage decisions and both durable medical equipment contracts and pharmacy benefit contracts.
|
•
|
Drive increased utilization and adoption of our products through a cloud-based data repository platform.
Through our acquisition of SweetSpot, we hope to develop a software platform that enables people with diabetes to aggregate and analyze data from numerous diabetes devices and share the data with their healthcare providers. We
|
•
|
Expand the use of our products to other patient care settings and patient demographics.
On February 3, 2014, the
FDA
approved a
Pediatric Indication
for the G4 PLATINUM, enabling us to market and sell that system in the United States to persons two years old and older who have diabetes. We believe our sensor technology may also be beneficial to women who develop gestational diabetes during their pregnancy and we intend to seek approval for a pregnancy indication in the future. We believe there is an unmet medical need for continuous glucose monitoring in the hospital setting. According to the
ADA
, diabetes related hospitalizations totaled 24.3 million days in 2007, an increase of 7.4 million days from 2002. In addition, studies show that many hospital patients without diabetes suffer episodes of hyperglycemia. As of 1998, as many as 1.5 million hospitalized patients in the United States had significant hyperglycemia without a history of diabetes. A study of over 1,500 hospitalized patients, of which only 13% had a history of diabetes, concluded that intensive insulin therapy to maintain blood glucose levels reduced mortality among critically ill patients in the surgical intensive care unit and improved patient outcomes. To address this patient population, we entered into an exclusive agreement with
Edwards
to develop jointly and market a specific product platform for the in-hospital critical care glucose monitoring market.
|
•
|
Provide a high level of customer support, service and education.
We support our sales and marketing efforts with a customer service program that includes customer training and support. We provide direct technical support by telephone 24 hours a day in the U.S. and Canada to customers, endocrinologists, physicians and diabetes educators to promote safe and successful use of our products.
|
•
|
Pursue the highest safety and quality levels for our products.
We have established an organization that is highly focused on product quality and customer safety. We have developed in-house engineering, quality assurance, clinical and regulatory expertise, and data analysis capabilities. Additionally, we seek to continue to establish credible and open relationships with regulatory bodies, physician opinion leaders and scientific experts. These capabilities and relationships will assist us in designing products that we believe will meet or exceed expectations for reliable, safe performance.
|
•
|
creating awareness of the benefits of continuous glucose monitoring and the advantages of our technology with endocrinologists, physicians, diabetes educators and people with diabetes;
|
•
|
providing strong and simple educational and training programs to healthcare providers and people with diabetes to ensure easy, safe and effective use of our systems; and
|
•
|
maintaining a readily accessible telephone and web-based technical and customer support infrastructure, which includes clinicians, diabetes educators and reimbursement specialists, to help referring physicians, diabetes educators and people with diabetes as necessary.
|
•
|
recruit and retain adequate numbers of effective sales personnel;
|
•
|
effectively train our sales personnel in the benefits of our products;
|
•
|
establish and maintain successful sales, marketing, training and education programs that encourage endocrinologists, physicians and diabetes educators to recommend our products to their patients; and
|
•
|
manage geographically disbursed operations.
|
•
|
significantly greater name recognition;
|
•
|
established relations with healthcare professionals, customers and third-party payors;
|
•
|
established distribution networks;
|
•
|
additional lines of products, and the ability to offer rebates or bundle products to offer higher discounts or incentives to gain a competitive advantage;
|
•
|
greater experience in conducting research and development, manufacturing, clinical trials, obtaining regulatory approval for products and marketing approved products; and
|
•
|
greater financial and human resources for product development, sales and marketing, and patent litigation.
|
•
|
safe, reliable and high quality performance of products;
|
•
|
cost of products and eligibility for reimbursement;
|
•
|
comfort and ease of use;
|
•
|
effective sales, marketing and distribution;
|
•
|
brand awareness and strong acceptance by healthcare professionals and people with diabetes;
|
•
|
customer service and support and comprehensive education for people with diabetes and diabetes care providers;
|
•
|
speed of product innovation and time to market;
|
•
|
regulatory expertise; and
|
•
|
technological leadership and superiority.
|
•
|
our systems may not be safe or effective to the
FDA
’s satisfaction;
|
•
|
the data from our pre-clinical studies and clinical trials may be insufficient to support approval;
|
•
|
the manufacturing process or facilities we use may not meet applicable requirements; and
|
•
|
changes in
FDA
approval policies or adoption of new regulations may require additional data.
|
•
|
the
FDA
or other regulatory authorities do not approve a clinical trial protocol or a clinical trial, or place a clinical trial on hold;
|
•
|
patients do not enroll in clinical trials at the rate we expect;
|
•
|
patients do not comply with trial protocols;
|
•
|
patient follow-up is not at the rate we expect;
|
•
|
patients experience adverse side effects;
|
•
|
patients die during a clinical trial, even though their death may not be related to our products;
|
•
|
institutional review boards and third-party clinical investigators may delay or reject our trial protocol;
|
•
|
third-party clinical investigators decline to participate in a trial or do not perform a trial on our anticipated schedule or consistent with the clinical trial protocol, good clinical practices or other
FDA
requirements;
|
•
|
DexCom or third-party organizations do not perform data collection, monitoring and analysis in a timely or accurate manner or consistent with the clinical trial protocol or investigational or statistical plans;
|
•
|
third-party clinical investigators have significant financial interests related to DexCom or the study that the
FDA
deems to make the study results unreliable, or DexCom or investigators fail to disclose such interests;
|
•
|
regulatory inspections of our clinical trials or manufacturing facilities, which may, among other things, require us to undertake corrective action or suspend or terminate our clinical trials;
|
•
|
changes in governmental regulations or administrative actions applicable to our trial protocols;
|
•
|
the interim or final results of the clinical trial are inconclusive or unfavorable as to safety or efficacy; and
|
•
|
the
FDA
concludes that our trial design is inadequate to demonstrate safety and efficacy.
|
•
|
establishment registration and device listing;
|
•
|
QSR
, which requires manufacturers to follow design, testing, control, storage, supplier/contractor selection, complaint handling, documentation and other quality assurance procedures;
|
•
|
labeling regulations, which prohibit the promotion of products for unapproved or off-label uses or indications and impose other restrictions on labeling, advertising and promotion;
|
•
|
medical device reporting regulations, which require that manufacturers report to the
FDA
if a device may have caused or contributed to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur;
|
•
|
voluntary and mandatory device recalls to address problems when a device is defective and/or could be a risk to health; and
|
•
|
corrections and removal reporting regulations, which require that manufacturers report to the
FDA
field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the
FDCA
that may present a risk to health.
|
•
|
warning letters or untitled letters that require corrective action;
|
•
|
fines and civil penalties;
|
•
|
unanticipated expenditures;
|
•
|
delays in approving or refusal to approve our future continuous glucose monitoring systems or other products;
|
•
|
FDA
refusal to issue certificates to foreign governments needed to export our products for sale in other countries;
|
•
|
suspension or withdrawal of
FDA
approval;
|
•
|
product recall or seizure;
|
•
|
interruption of production;
|
•
|
operating restrictions;
|
•
|
injunctions; and
|
•
|
criminal prosecution.
|
ITEM 1A.
|
RISK FACTORS
|
•
|
the approval to sell our G4 system in the European Union, Australia, New Zealand, and the countries in Asia and Latin America that recognize our
CE Mark
in June 2012 and approval for our G4 PLATINUM system in the United States in October 2012 means that we have relatively limited experience selling our G4 system;
|
•
|
the approval for a
Pediatric Indication
of our G4 PLATINUM system in the United States, Canada, European Union, Australia, New Zealand and the countries in Asia and Latin America that recognize our
CE Mark
means that we have limited experience selling and marketing the G4 PLATINUM system to persons aged two to 17 years or their legal guardians;
|
•
|
the recent approval for a Professional Use Indication of our G4 PLATINUM system in the United States means that we have limited experience selling and marketing the G4 PLATINUM system to healthcare professionals;
|
•
|
widespread market acceptance of our products by physicians and people with diabetes will largely depend on our ability to demonstrate their relative safety, efficacy, reliability, cost-effectiveness and ease of use;
|
•
|
the limited size of our sales force;
|
•
|
we may not have sufficient financial or other resources to adequately expand the commercialization efforts for our products;
|
•
|
our
FDA
and other regulatory submissions may be delayed, or approved with limited product labeling;
|
•
|
we may not be able to manufacture our products in commercial quantities or at an acceptable cost;
|
•
|
people with diabetes do not generally receive broad reimbursement from third-party payors for their purchase of our products since many payors require that a policy holder meet specific medical criteria to qualify for reimbursement, which may reduce widespread use of our products;
|
•
|
the uncertainties associated with establishing and qualifying new manufacturing facilities;
|
•
|
our systems are not labeled as a replacement for the information that is obtained from single-point finger stick devices;
|
•
|
people with diabetes will need to incur the costs of our systems in addition to single-point finger stick devices;
|
•
|
the relative immaturity of the continuous glucose monitoring market internationally, and the general absence of international reimbursement of continuous glucose monitoring devices by third-party payors and government healthcare providers outside the United States;
|
•
|
the introduction and market acceptance of competing products and technologies;
|
•
|
our inability to obtain sufficient quantities of supplies at appropriate quality levels from our single-source and other key suppliers;
|
•
|
our inability to manufacture products that perform in accordance with expectations of consumers; and
|
•
|
rapid technological change may make our technology and our products obsolete.
|
•
|
the revenue generated by sales of our products and other future products;
|
•
|
the costs, timing and risks of delay of additional regulatory approvals;
|
•
|
the expenses we incur in manufacturing, developing, selling and marketing our products;
|
•
|
our ability to scale our manufacturing operations to meet demand for our current and any future products;
|
•
|
the costs to produce our continuous glucose monitoring systems;
|
•
|
the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights;
|
•
|
the rate of progress and cost of our clinical trials and other development activities;
|
•
|
the success of our research and development efforts;
|
•
|
the emergence of competing or complementary technological developments;
|
•
|
the terms and timing of any collaborative, licensing and other arrangements that we may establish; and
|
•
|
the acquisition of businesses, products and technologies, although we currently have no commitments or agreements relating to any of these types of transactions.
|
•
|
recruit and retain adequate numbers of effective and experienced sales personnel;
|
•
|
effectively train our sales personnel in the benefits and risks of our products;
|
•
|
establish and maintain successful sales, marketing and education programs that educate endocrinologists, physicians and diabetes educators so they can appropriately inform their patients about our products; and
|
•
|
manage geographically disbursed sales and marketing operations.
|
•
|
the system may not be deemed by the
FDA
to be substantially equivalent to appropriate predicate devices;
|
•
|
the system may not satisfy the
FDA
's safety or efficacy requirements;
|
•
|
the data from pre-clinical studies and clinical trials may be insufficient to support approval;
|
•
|
the manufacturing process or facilities used may not meet applicable requirements; and
|
•
|
changes in
FDA
approval policies or adoption of new regulations may require additional data.
|
•
|
the
FDA
or other regulatory authorities do not approve a clinical trial protocol or a clinical trial, or place a clinical trial on hold;
|
•
|
patients do not enroll in clinical trials at the rate we expect;
|
•
|
patients do not comply with trial protocols;
|
•
|
patient follow-up does not occur at the rate we expect;
|
•
|
patients experience adverse side effects;
|
•
|
patients die during a clinical trial, even though their death may not be related to our products;
|
•
|
institutional review boards (“IRBs”) and third-party clinical investigators may delay or reject our trial protocol;
|
•
|
third-party clinical investigators decline to participate in a trial or do not perform a trial on our anticipated schedule or consistent with the investigator agreements, clinical trial protocol, good clinical practices or other
FDA
or IRB requirements;
|
•
|
DexCom or third-party organizations do not perform data collection, monitoring and analysis in a timely or accurate manner or consistent with the clinical trial protocol or investigational or statistical plans;
|
•
|
third-party clinical investigators have significant financial interests related to DexCom or the study that the
FDA
deems to make the study results unreliable, or DexCom or investigators fail to disclose such interests;
|
•
|
regulatory inspections of our clinical trials or manufacturing facilities may, among other things, require us to undertake corrective action or suspend or terminate our clinical trials;
|
•
|
changes in governmental regulations, policies or administrative actions applicable to our trial protocols;
|
•
|
the interim or final results of the clinical trial are inconclusive or unfavorable as to safety or efficacy; and
|
•
|
the
FDA
concludes that our trial design is inadequate to demonstrate safety and efficacy.
|
•
|
billing for services;
|
•
|
financial relationships with physicians and other referral sources;
|
•
|
inducements and courtesies given to physicians and other health care providers and patients;
|
•
|
labeling products;
|
•
|
quality of medical equipment and services;
|
•
|
confidentiality, maintenance and security issues associated with medical records and individually identifiable health and other personal information;
|
•
|
medical device reporting;
|
•
|
prohibitions on kickbacks, also referred to as anti-kickback laws or regulations;
|
•
|
any scheme to defraud any healthcare benefit program;
|
•
|
physician payment disclosure requirements;
|
•
|
false claims; and
|
•
|
professional licensure.
|
•
|
we may not be able to obtain adequate supply in a timely manner or on commercially reasonable terms;
|
•
|
our products are technologically complex and it is difficult to develop alternative supply sources;
|
•
|
we are not a major customer of many of our suppliers, and these suppliers may therefore give other customers' needs higher priority than ours;
|
•
|
our suppliers may make errors in manufacturing components that could negatively affect the efficacy or safety of our products or cause delays in shipment of our products;
|
•
|
we may have difficulty locating and qualifying alternative suppliers for our single-source supplies;
|
•
|
switching components may require product redesign and submission to the
FDA
of a
PMA
supplement or possibly a separate
PMA
, either of which could significantly delay production;
|
•
|
our suppliers manufacture products for a range of customers, and fluctuations in demand for the products these suppliers manufacture for others may affect their ability to deliver components to us in a timely manner;
|
•
|
our suppliers may make obsolete components that are critical to our products; and
|
•
|
our suppliers may encounter financial hardships unrelated to our demand for components, including those related to changes in global economic conditions, which could inhibit their ability to fulfill our orders and meet our requirements.
|
•
|
warning letters or untitled letters that require corrective action;
|
•
|
delays in approving or refusal to approve our continuous glucose monitoring systems;
|
•
|
fines and civil penalties;
|
•
|
unanticipated expenditures;
|
•
|
FDA
refusal to issue certificates to foreign governments needed to export our products for sale in other countries;
|
•
|
suspension or withdrawal of approval by the
FDA
or other regulatory bodies;
|
•
|
product recall or seizure;
|
•
|
interruption of production;
|
•
|
interruption of the supply of components from our key component suppliers;
|
•
|
operating restrictions;
|
•
|
injunctions; and
|
•
|
criminal prosecution.
|
•
|
significantly greater name recognition;
|
•
|
established relations with healthcare professionals, customers and third-party payors;
|
•
|
established distribution networks;
|
•
|
additional lines of products, and the ability to offer rebates or bundle products to offer higher discounts or incentives to gain a competitive advantage;
|
•
|
greater experience in conducting research and development, manufacturing, clinical trials, obtaining regulatory approval for products and marketing approved products; and
|
•
|
greater financial and human resources for product development, sales and marketing, and patent litigation.
|
•
|
securities analyst coverage or lack of coverage of our common stock or changes in their estimates of our financial performance;
|
•
|
variations in quarterly operating results;
|
•
|
future sales of our common stock by our stockholders;
|
•
|
investor perception of us and our industry;
|
•
|
announcements by us or our competitors of significant agreements, acquisitions or capital commitments;
|
•
|
changes in market valuation or earnings of our competitors;
|
•
|
general economic conditions;
|
•
|
regulatory actions;
|
•
|
legislation and political conditions; and
|
•
|
terrorist acts.
|
•
|
our inability to manufacture an adequate supply of product at appropriate quality levels and acceptable costs;
|
•
|
possible delays in our research and development programs or in the completion of any clinical trials;
|
•
|
a lack of acceptance of our products in the marketplace by physicians and people with diabetes;
|
•
|
the inability of customers to receive reimbursements from third-party payors;
|
•
|
failures to comply with regulatory requirements, which could lead to withdrawal of products from the market;
|
•
|
our failure to continue the commercialization of any of our continuous glucose monitoring systems;
|
•
|
competition;
|
•
|
inadequate financial and other resources; and
|
•
|
global and political economic conditions, political instability and military hostilities.
|
•
|
our Board of Directors may, without stockholder approval, issue shares of preferred stock with special voting or economic rights;
|
•
|
our stockholders do not have cumulative voting rights and, therefore, each of our directors can only be elected by holders of a majority of our outstanding common stock;
|
•
|
a special meeting of stockholders may only be called by a majority of our Board of Directors, the Chairman of our Board of Directors, or our Chief Executive Officer;
|
•
|
our stockholders may not take action by written consent;
|
•
|
our Board of Directors is divided into three classes, only one of which is elected each year; and
|
•
|
we require advance notice for nominations for election to the Board of Directors or for proposing matters that can be acted upon by stockholders at stockholder meetings.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
|
High
|
|
Low
|
||||
Year Ended December 31, 2014
|
|
|
|
|
||||
First Quarter
|
|
$
|
49.83
|
|
|
$
|
34.13
|
|
Second Quarter
|
|
$
|
42.46
|
|
|
$
|
28.09
|
|
Third Quarter
|
|
$
|
46.37
|
|
|
$
|
34.67
|
|
Fourth Quarter
|
|
$
|
58.32
|
|
|
$
|
38.77
|
|
|
|
High
|
|
Low
|
||||
Year Ended December 31, 2013
|
|
|
|
|
||||
First Quarter
|
|
$
|
17.16
|
|
|
$
|
13.69
|
|
Second Quarter
|
|
$
|
22.97
|
|
|
$
|
15.04
|
|
Third Quarter
|
|
$
|
29.24
|
|
|
$
|
21.76
|
|
Fourth Quarter
|
|
$
|
35.97
|
|
|
$
|
26.68
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
|
|
(in millions, except per share data)
|
||||||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Product revenue
|
|
$
|
257.1
|
|
|
$
|
157.1
|
|
|
$
|
93.0
|
|
|
$
|
65.9
|
|
|
$
|
40.2
|
|
Development grant and other revenue
|
|
2.1
|
|
|
2.9
|
|
|
6.9
|
|
|
10.4
|
|
|
8.4
|
|
|||||
Total revenue
|
|
259.2
|
|
|
160.0
|
|
|
99.9
|
|
|
76.3
|
|
|
48.6
|
|
|||||
Product cost of sales
|
|
82.3
|
|
|
58.1
|
|
|
48.3
|
|
|
36.6
|
|
|
26.1
|
|
|||||
Development and other cost of sales
|
|
0.6
|
|
|
1.8
|
|
|
5.0
|
|
|
3.8
|
|
|
4.1
|
|
|||||
Total cost of sales
|
|
82.9
|
|
|
59.9
|
|
|
53.3
|
|
|
40.4
|
|
|
30.2
|
|
|||||
Gross profit
|
|
176.3
|
|
|
100.1
|
|
|
46.6
|
|
|
35.9
|
|
|
18.4
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Research and development
|
|
69.4
|
|
|
44.8
|
|
|
38.3
|
|
|
29.6
|
|
|
22.0
|
|
|||||
Selling, general and administrative
|
|
128.4
|
|
|
84.2
|
|
|
64.0
|
|
|
51.1
|
|
|
41.7
|
|
|||||
Total operating expenses
|
|
197.8
|
|
|
129.0
|
|
|
102.3
|
|
|
80.7
|
|
|
63.7
|
|
|||||
Operating loss
|
|
(21.5
|
)
|
|
(28.9
|
)
|
|
(55.7
|
)
|
|
(44.8
|
)
|
|
(45.3
|
)
|
|||||
Interest and other income
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|||||
Interest expense
|
|
(0.8
|
)
|
|
(0.9
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
(1.5
|
)
|
|||||
Loss on debt extinguishment upon conversion of convertible debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.5
|
)
|
|||||
Loss before income taxes
|
|
(22.3
|
)
|
|
(29.8
|
)
|
|
(55.8
|
)
|
|
(44.7
|
)
|
|
(55.2
|
)
|
|||||
Income tax expense (benefit)
|
|
0.1
|
|
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|||||
Net loss
|
|
$
|
(22.4
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(54.5
|
)
|
|
$
|
(44.7
|
)
|
|
$
|
(55.2
|
)
|
Basic and diluted net loss per share attributable to common stockholders
(1)
|
|
$
|
(0.30
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.79
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.97
|
)
|
Shares used to compute basic and diluted net loss per share attributable to common stockholders
(1)
|
|
75.2
|
|
|
71.1
|
|
|
68.7
|
|
|
65.6
|
|
|
56.9
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
As of December 31,
|
||||||||||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
|
|
(in millions)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents, and short-term marketable securities
|
|
$
|
83.6
|
|
|
$
|
54.6
|
|
|
$
|
48.7
|
|
|
$
|
82.0
|
|
|
$
|
47.1
|
|
Working capital
|
|
105.3
|
|
|
61.0
|
|
|
58.1
|
|
|
89.8
|
|
|
50.2
|
|
|||||
Total assets
|
|
184.6
|
|
|
122.5
|
|
|
106.0
|
|
|
120.5
|
|
|
77.2
|
|
|||||
Long term obligations
|
|
3.8
|
|
|
6.3
|
|
|
9.5
|
|
|
1.3
|
|
|
1.0
|
|
|||||
Total stockholders’ equity
|
|
140.2
|
|
|
84.1
|
|
|
77.0
|
|
|
104.5
|
|
|
61.0
|
|
(1)
|
See Note 2 of the notes to our consolidated financial statements for a description of the method used to compute basic and diluted net loss per share attributable to common stockholders.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
(In millions)
|
Years Ended December 31,
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Net cash provided by (used in) operating activities
|
23.6
|
|
|
2.4
|
|
|
(33.1
|
)
|
Net cash provided by (used in) investing activities
|
(16.8
|
)
|
|
20.9
|
|
|
28.4
|
|
Net cash provided by financing activities
|
21.8
|
|
|
11.8
|
|
|
10.2
|
|
•
|
the revenue generated by sales of our approved products and other future products;
|
•
|
the expenses we incur in manufacturing, developing, selling and marketing our products;
|
•
|
the quality levels of our products and services;
|
•
|
the third-party reimbursement of our products for our customers;
|
•
|
our ability to efficiently scale our manufacturing operations to meet demand for our current and any future products;
|
•
|
the costs, timing and risks of delays of additional regulatory approvals;
|
•
|
the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights;
|
•
|
the rate of progress and cost of our clinical trials and other development activities;
|
•
|
the success of our research and development efforts;
|
•
|
the emergence of competing or complementary technological developments;
|
•
|
the terms and timing of any collaborative, licensing and other arrangements that we may establish; and
|
•
|
the acquisition of businesses, products and technologies and our ability to integrate and manage any acquired businesses, products and technologies, including without limitation, SweetSpot.
|
Contractual Obligations:
|
|
Total
|
|
Less
than
1 Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More
than
5 Years
|
||||||||||
Operating leases
|
|
$
|
32.7
|
|
|
$
|
3.1
|
|
|
$
|
7.6
|
|
|
$
|
10.2
|
|
|
$
|
11.8
|
|
Long-term debt
|
|
4.6
|
|
|
2.3
|
|
|
2.3
|
|
|
—
|
|
|
—
|
|
|||||
Purchase commitments
|
|
18.0
|
|
|
18.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
55.3
|
|
|
$
|
23.4
|
|
|
$
|
9.9
|
|
|
$
|
10.2
|
|
|
$
|
11.8
|
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
(a)
|
The following documents are filed as part of this Annual Report:
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Exhibit
Number
|
|
Provided
Herewith
|
||||||
Form
|
|
File No.
|
|
Date of
First Filing
|
|
|||||||||
3.01
|
|
|
Registrant’s Restated Certificate of Incorporation.
|
|
S-1/A
|
|
333-122454
|
|
March 3, 2005
|
|
3.03
|
|
|
|
3.02
|
|
|
Registrant’s Amended and Restated Bylaws.
|
|
8-K
|
|
000-51222
|
|
November 25, 2014
|
|
3.01
|
|
|
|
4.01
|
|
|
Form of Specimen Certificate for Registrant’s common stock.
|
|
S-1/A
|
|
333-122454
|
|
March 24, 2005
|
|
4.01
|
|
|
|
4.02
|
|
|
Second Amended and Restated Investors’ Rights Agreement, dated December 30, 2004.
|
|
S-1
|
|
333-122454
|
|
February 1, 2005
|
|
4.02
|
|
|
|
4.03
|
|
|
Form of Rights Agreement, between DexCom, Inc. and American Stock Transfer & Trust Company, including the Certificate of Designations of Series A Junior Participating Preferred Stock, Summary of Stock Purchase Rights and Forms of Right Certificate attached thereto as Exhibit A, B and C, respectively.
|
|
S-1/A
|
|
000-51222
|
|
March 24, 2005
|
|
4.03
|
|
|
|
10.01
|
|
|
Form of Indemnity Agreement between Registrant and each of its directors and executive officers.
|
|
S-1
|
|
333-122454
|
|
February 1, 2005
|
|
10.01
|
|
|
|
10.02
|
|
|
1999 Stock Option Plan and related agreements.*
|
|
S-1
|
|
333-122454
|
|
February 1, 2005
|
|
10.02
|
|
|
|
10.03
|
|
|
2005 Equity Incentive Plan and forms of stock option agreement and stock option exercise agreements.*
|
|
S-1/A
|
|
000-51222
|
|
March 24, 2005
|
|
10.03
|
|
|
|
10.04
|
|
|
2005 Employee Stock Purchase Plan and form of subscription agreement.*
|
|
S-1/A
|
|
000-51222
|
|
March 24, 2005
|
|
10.04
|
|
|
|
10.05
|
|
|
Offer letter between DexCom, Inc. and Jorge Valdes dated October 16, 2005.*
|
|
10-K
|
|
000-51222
|
|
February 27, 2006
|
|
10.14
|
|
|
|
10.06
|
|
|
Office Lease Agreement, dated March 31, 2006, between DexCom, Inc. and Kilroy Realty, L.P.
|
|
8-K
|
|
000-51222
|
|
April 7, 2006
|
|
99.01
|
|
|
|
10.07
|
|
|
Offer letter between DexCom, Inc. and Steven R. Pacelli dated April 10, 2006.*
|
|
8-K
|
|
000-51222
|
|
April 13, 2006
|
|
99.01
|
|
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Exhibit
Number
|
|
Provided
Herewith
|
|
||||||
Form
|
|
File No.
|
|
Date of
First Filing
|
|
|
|||||||||
10.08
|
|
|
Collaboration Agreement, dated November 10, 2008 between DexCom, Inc. and Edwards Lifesciences LLC.**
|
|
8-K/A
|
|
000-51222
|
|
January 28, 2009
|
|
10.1
|
|
|
|
|
10.09
|
|
|
Amended and Restated Joint Development Agreement, dated January 12, 2009, between DexCom, Inc. and Animas Corporation.**
|
|
8-K/A
|
|
000-51222
|
|
January 28, 2009
|
|
10.1
|
|
|
|
|
10.10
|
|
|
OUS Commercialization Agreement, dated January 12, 2009, between DexCom, Inc. and Animas Corporation.**
|
|
8-K/A
|
|
000-51222
|
|
January 28, 2009
|
|
10.2
|
|
|
|
|
10.11
|
|
|
Form of Amended and Restated Executive Change of Control & Severance Agreement.*
|
|
10-K
|
|
000-51222
|
|
March 5, 2009
|
|
10.20
|
|
|
|
|
10.12
|
|
|
Amended and Restated Offer Letter Agreement dated December 19, 2008 between DexCom, Inc. and Terrance H. Gregg.*
|
|
10-K
|
|
000-51222
|
|
March 5, 2009
|
|
10.21
|
|
|
|
|
10.13
|
|
|
Letter Agreement, between Edwards Lifesciences LLC and DexCom, Inc., dated May 5, 2009.
|
|
10-Q
|
|
000-51222
|
|
August 3, 2009
|
|
10.22
|
|
|
|
|
10.14
|
|
|
Non-Exclusive Distribution Agreement, between RGH Enterprises, Inc. and DexCom, Inc., dated April 30, 2008.**
|
|
10-Q
|
|
000-51222
|
|
August 3, 2009
|
|
10.23
|
|
|
|
|
10.15
|
|
|
Letter of Amendment of the Amended and Restated Joint Development Agreement, between Animas Corporation and DexCom, Inc., dated July 30, 2009.**
|
|
10-Q
|
|
000-51222
|
|
November 4, 2009
|
|
10.24
|
|
|
|
|
10.16
|
|
|
Amendment No. 1 to the Commercialization Agreements, between Animas Corporation and DexCom, Inc., dated July 30, 2009.**
|
|
10-Q
|
|
000-51222
|
|
November 4, 2009
|
|
10.25
|
|
|
|
|
10.17
|
|
|
Amended and Restated Development, Manufacturing, Licensing and Supply Agreement, between DSM PTG, Inc. and DexCom, Inc., dated February 19, 2010.**
|
|
10-K
|
|
000-51222
|
|
March 9, 2010
|
|
10.25
|
|
|
|
|
10.18
|
|
|
Form of Restricted Stock Unit Award Agreement.
|
|
10-Q
|
|
000-51222
|
|
May 5, 2010
|
|
10.26
|
|
|
|
|
10.19
|
|
|
First Amendment to Office Lease between DexCom, Inc. and Kilroy Realty, L.P., dated August 18, 2010.
|
|
10-Q
|
|
000-51222
|
|
November 4, 2010
|
|
10.27
|
|
|
|
|
10.20
|
|
|
2005 Equity Incentive Plan, as amended.*
|
|
10-Q
|
|
000-51222
|
|
May 3, 2011
|
|
10.25
|
|
|
|
|
10.21
|
|
|
Amendment Number One to Non-Exclusive Distribution Agreement, between RGH Enterprises, Inc. and DexCom, Inc., dated March 29, 2011.**
|
|
10-Q/A
|
|
000-51222
|
|
July 1, 2011
|
|
10.26
|
|
|
|
|
10.22
|
|
|
Amendment No. 2 to the OUS Commercialization Agreement, between Animas Corporation and DexCom, Inc., dated June 7, 2011.**
|
|
10-Q
|
|
000-51222
|
|
August 3, 2011
|
|
10.27
|
|
|
|
|
10.23
|
|
|
Offer letter between DexCom, Inc. and Kevin Sayer dated May 3, 2011.*
|
|
10-Q
|
|
000-51222
|
|
August 3, 2011
|
|
10.28
|
|
|
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Exhibit
Number
|
|
Provided
Herewith
|
|
||||||
Form
|
|
File No.
|
|
Date of
First Filing
|
|
|
|||||||||
10.24
|
|
|
Research and Development Agreement, between Roche Diagnostics Operations, Inc. and DexCom, Inc. dated November 1, 2011.**
|
|
10-K
|
|
000-51222
|
|
February 23, 2012
|
|
10.26
|
|
|
|
|
10.25
|
|
|
Loan and Security Agreement by and among Silicon Valley Bank, Oxford Finance LLC, DexCom, Inc. and SweetSpot Diabetes Care, Inc. dated November 1, 2012.
|
|
10-K
|
|
000-51222
|
|
February 21, 2013
|
|
10.26
|
|
|
|
|
10.26
|
|
|
Amendment Number Two to Non-Exclusive Distribution Agreement between RGH Enterprises, Inc. and DexCom, Inc., dated March 28, 2013.**
|
|
10-Q
|
|
000-51222
|
|
May 1, 2013
|
|
10.27
|
|
|
|
|
10.27
|
|
|
Amendment Number Three to Non-Exclusive Distribution Agreement between RGH Enterprises, Inc. and DexCom, Inc., dated December 4, 2013.**
|
|
10-K
|
|
000-51222
|
|
February 20, 2014
|
|
10.28
|
|
|
|
|
10.28
|
|
|
Non-Exclusive Distribution Agreement between Dexcom, Inc. and Diabetes Specialty Center, LLC dated October 12, 2009, as amended on September 30, 2010, October 11, 2011, November 14, 2012 and November 1, 2013.**
|
|
10-K
|
|
000-51222
|
|
February 20, 2014
|
|
10.29
|
|
|
|
|
10.29
|
|
|
First Amendment to Loan and Security Agreement by and among Silicon Valley Bank, Oxford Finance LLC, DexCom, Inc. and SweetSpot Diabetes Care, Inc. dated August 6, 2013.
|
|
10-Q
|
|
000-51222
|
|
March 31, 2014
|
|
10.30
|
|
|
|
|
10.30
|
|
|
Settlement and License Agreement by and among Abbott Diabetes Care, Inc. and DexCom, Inc., dated July 2, 2014.
|
|
10-Q
|
|
000-51222
|
|
August 6, 2014
|
|
10.31
|
|
|
|
|
10.31
|
|
|
Amendment No. 5 to Non-Exclusive Distribution Agreement between DexCom, Inc. and Diabetes Specialty Center, LLC, dated March 14, 2014.
|
|
10-Q
|
|
000-51222
|
|
August 6, 2014
|
|
10.32
|
|
|
|
|
10.32
|
|
|
Second Amendment to Office Lease between DexCom, Inc. and Kilroy Realty, L.P., dated October 1, 2014.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
21.01
|
|
|
List of Subsidiaries.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
23.01
|
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
24.01
|
|
|
Power of Attorney. (See page 60 of this Form 10-K).
|
|
|
|
|
|
|
|
|
|
X
|
|
|
31.01
|
|
|
Certification of Chief Executive Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
|
|
|
|
|
|
|
|
|
|
X
|
|
|
31.02
|
|
|
Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rule 13a-14(a).
|
|
|
|
|
|
|
|
|
|
X
|
|
|
32.01
|
|
|
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).***
|
|
|
|
|
|
|
|
|
|
X
|
|
|
32.02
|
|
|
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 and Securities Exchange Act Rule 13a-14(b).***
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
|
|
X
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Exhibit
Number
|
|
Provided
Herewith
|
|
||||||
Form
|
|
File No.
|
|
Date of
First Filing
|
|
|
|||||||||
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
|
||
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
||
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
||
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
||
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
*
|
Represents a management contract or compensatory plan.
|
**
|
Confidential treatment has been requested for certain portions of this document pursuant to an application for confidential treatment sent to the Securities and Exchange Commission. Such portions are omitted from this filing and were filed separately with the Securities and Exchange Commission.
|
***
|
This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that DexCom specifically incorporates it by reference.
|
|
|
|
|
DEXCOM, INC.
(Registrant)
|
||
|
|
|
|
|||
Dated: February 25, 2015
|
|
|
|
By:
|
|
/
S
/ J
ESS
R
OPER
|
|
|
|
|
|
|
Jess Roper, Chief Financial Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
||
/S/ KEVIN SAYER
|
|
President, Chief Executive Officer, and Director (Principal Executive Officer)
|
|
February 25, 2015
|
Kevin Sayer
|
|
|
|
|
|
|
|
||
/S/ JESS ROPER
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer) |
|
February 25, 2015
|
Jess Roper
|
|
|
|
|
|
|
|
||
/S/ TERRANCE GREGG
|
|
Executive Chairman of the Board of Directors
|
|
February 25, 2015
|
Terrance Gregg
|
|
|
|
|
|
|
|
||
/S/ JONATHAN LORD
|
|
Lead Independent Director
|
|
February 25, 2015
|
Jonathan Lord, M.D.
|
|
|
|
|
|
|
|
||
/S/ STEVE ALTMAN
|
|
Director
|
|
February 25, 2015
|
Steve Altman
|
|
|
|
|
|
|
|
||
/S/ NICHOLAS AUGUSTINOS
|
|
Director
|
|
February 25, 2015
|
Nicholas Augustinos
|
|
|
|
|
|
|
|
||
/S/ MARK FOLETTA
|
|
Director
|
|
February 25, 2015
|
Mark Foletta
|
|
|
|
|
|
|
|
|
|
/S/ BARBARA KAHN
|
|
Director
|
|
February 25, 2015
|
Barbara Kahn
|
|
|
|
|
|
|
|
||
/S/ JAY SKYLER
|
|
Director
|
|
February 25, 2015
|
Jay Skyler, M.D.
|
|
|
|
|
|
|
|
||
/S/ ERIC TOPOL
|
|
Director
|
|
February 25, 2015
|
Eric Topol, M.D.
|
|
|
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
F-2
|
|
Consolidated Balance Sheets
|
|
|
F-3
|
|
Consolidated Statements of Operations
|
|
|
F-4
|
|
Consolidated Statements of Comprehensive Loss
|
|
|
F-5
|
|
Consolidated Statements of Stockholders’ Equity
|
|
|
F-6
|
|
Consolidated Statements of Cash Flows
|
|
|
F-7
|
|
Notes to Consolidated Financial Statements
|
|
|
F-8
|
|
|
/s/ Ernst & Young LLP
|
|
As of December 31,
|
||||||
|
2014
|
|
2013
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
71.8
|
|
|
$
|
43.2
|
|
Short-term marketable securities, available-for-sale
|
11.8
|
|
|
11.4
|
|
||
Accounts receivable, net
|
42.4
|
|
|
26.1
|
|
||
Inventory
|
16.0
|
|
|
9.0
|
|
||
Prepaid and other current assets
|
3.9
|
|
|
3.4
|
|
||
Total current assets
|
145.9
|
|
|
93.1
|
|
||
Property and equipment, net
|
31.2
|
|
|
20.7
|
|
||
Restricted cash
|
1.0
|
|
|
1.0
|
|
||
Intangible assets, net
|
2.7
|
|
|
3.6
|
|
||
Goodwill
|
3.2
|
|
|
3.2
|
|
||
Other assets
|
0.6
|
|
|
0.9
|
|
||
Total assets
|
$
|
184.6
|
|
|
$
|
122.5
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
20.4
|
|
|
$
|
14.1
|
|
Accrued payroll and related expenses
|
17.2
|
|
|
15.1
|
|
||
Current portion of long-term debt
|
2.3
|
|
|
2.2
|
|
||
Current portion of deferred revenue
|
0.7
|
|
|
0.7
|
|
||
Total current liabilities
|
40.6
|
|
|
32.1
|
|
||
Other liabilities
|
1.5
|
|
|
1.7
|
|
||
Long-term debt, net of current portion
|
2.3
|
|
|
4.6
|
|
||
Total liabilities
|
44.4
|
|
|
38.4
|
|
||
Commitments and contingencies (Note 4)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value, 5.0 shares authorized; no shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 100.0 authorized; 77.6 and 77.3 issued and outstanding, respectively, at December 31, 2014; and 72.8 and 72.5 shares issued and outstanding, respectively, at December 31, 2013
|
0.1
|
|
|
0.1
|
|
||
Additional paid-in capital
|
638.0
|
|
|
559.5
|
|
||
Accumulated other comprehensive loss
|
(0.1
|
)
|
|
(0.1
|
)
|
||
Accumulated deficit
|
(497.8
|
)
|
|
(475.4
|
)
|
||
Total stockholders’ equity
|
140.2
|
|
|
84.1
|
|
||
Total liabilities and stockholders’ equity
|
$
|
184.6
|
|
|
$
|
122.5
|
|
|
Years Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Product revenue
|
$
|
257.1
|
|
|
$
|
157.1
|
|
|
$
|
93.0
|
|
Development grant and other revenue
|
2.1
|
|
|
2.9
|
|
|
6.9
|
|
|||
Total revenue
|
259.2
|
|
|
160.0
|
|
|
99.9
|
|
|||
Product cost of sales
|
82.3
|
|
|
58.1
|
|
|
48.3
|
|
|||
Development and other cost of sales
|
0.6
|
|
|
1.8
|
|
|
5.0
|
|
|||
Total cost of sales
|
82.9
|
|
|
59.9
|
|
|
53.3
|
|
|||
Gross profit
|
176.3
|
|
|
100.1
|
|
|
46.6
|
|
|||
Operating expenses
|
|
|
|
|
|
||||||
Research and development
|
69.4
|
|
|
44.8
|
|
|
38.3
|
|
|||
Selling, general and administrative
|
128.4
|
|
|
84.2
|
|
|
64.0
|
|
|||
Total operating expenses
|
197.8
|
|
|
129.0
|
|
|
102.3
|
|
|||
Operating loss
|
(21.5
|
)
|
|
(28.9
|
)
|
|
(55.7
|
)
|
|||
Interest and other income
|
—
|
|
|
—
|
|
|
0.1
|
|
|||
Interest expense
|
(0.8
|
)
|
|
(0.9
|
)
|
|
(0.2
|
)
|
|||
Loss before income taxes
|
(22.3
|
)
|
|
(29.8
|
)
|
|
(55.8
|
)
|
|||
Income tax expense (benefit)
|
0.1
|
|
|
—
|
|
|
(1.3
|
)
|
|||
Net loss
|
$
|
(22.4
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(54.5
|
)
|
Basic and diluted net loss per share
|
$
|
(0.30
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.79
|
)
|
Shares used to compute basic and diluted net loss per share
|
75.2
|
|
|
71.1
|
|
|
68.7
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net loss
|
|
$
|
(22.4
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(54.5
|
)
|
Unrealized gain (loss) on short-term available-for-sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Foreign currency translation gain (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Comprehensive loss
|
|
$
|
(22.4
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(54.5
|
)
|
|
|
Common stock
|
|
Additional
paid-in
capital
|
|
Accumulated
other
comprehensive
income (loss)
|
|
Accumulated
deficit
|
|
Total
stockholders’
equity
|
|||||||||||||
Shares
|
|
Amount
|
|
||||||||||||||||||||
Balance at December 31, 2011
|
|
67.5
|
|
|
$
|
0.1
|
|
|
$
|
495.6
|
|
|
$
|
(0.1
|
)
|
|
$
|
(391.1
|
)
|
|
$
|
104.5
|
|
Issuance of common stock under equity incentive plans
|
|
1.3
|
|
|
—
|
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
2.1
|
|
|||||
Issuance of common stock for Employee Stock Purchase Plan
|
|
0.2
|
|
|
—
|
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|||||
Issuance of common stock for SweetSpot acquisition and milestone
|
|
0.5
|
|
|
—
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
|
5.0
|
|
|||||
Share-based compensation for employee stock option and award grants
|
|
—
|
|
|
—
|
|
|
18.4
|
|
|
—
|
|
|
—
|
|
|
18.4
|
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(54.5
|
)
|
|
(54.5
|
)
|
|||||
Balance at December 31, 2012
|
|
69.5
|
|
|
0.1
|
|
|
522.6
|
|
|
(0.1
|
)
|
|
(445.6
|
)
|
|
77.0
|
|
|||||
Issuance of common stock under equity incentive plans
|
|
2.8
|
|
|
—
|
|
|
10.2
|
|
|
—
|
|
|
—
|
|
|
10.2
|
|
|||||
Issuance of common stock for Employee Stock Purchase Plan
|
|
0.2
|
|
|
—
|
|
|
1.9
|
|
|
—
|
|
|
—
|
|
|
1.9
|
|
|||||
Share-based compensation for employee stock option and award grants
|
|
—
|
|
|
—
|
|
|
24.8
|
|
|
—
|
|
|
—
|
|
|
24.8
|
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29.8
|
)
|
|
(29.8
|
)
|
|||||
Balance at December 31, 2013
|
|
72.5
|
|
|
0.1
|
|
|
559.5
|
|
|
(0.1
|
)
|
|
(475.4
|
)
|
|
84.1
|
|
|||||
Issuance of common stock under equity incentive plans
|
|
4.6
|
|
|
—
|
|
|
21.4
|
|
|
—
|
|
|
—
|
|
|
21.4
|
|
|||||
Issuance of common stock for Employee Stock Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
|
2.6
|
|
|||||
Issuance of common stock for contingent consideration settlement
|
|
0.1
|
|
|
—
|
|
|
4.0
|
|
|
—
|
|
|
—
|
|
|
4.0
|
|
|||||
Share-based compensation for employee stock option and award grants
|
|
—
|
|
|
—
|
|
|
50.5
|
|
|
—
|
|
|
—
|
|
|
50.5
|
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22.4
|
)
|
|
(22.4
|
)
|
|||||
Balance at December 31, 2014
|
|
77.3
|
|
|
$
|
0.1
|
|
|
$
|
638.0
|
|
|
$
|
(0.1
|
)
|
|
$
|
(497.8
|
)
|
|
$
|
140.2
|
|
|
Years Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Operating activities
|
|
|
|
|
|
||||||
Net loss
|
$
|
(22.4
|
)
|
|
$
|
(29.8
|
)
|
|
$
|
(54.5
|
)
|
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
8.4
|
|
|
7.0
|
|
|
6.6
|
|
|||
Share-based compensation
|
50.0
|
|
|
24.6
|
|
|
18.4
|
|
|||
Accretion and amortization related to marketable securities, net
|
0.1
|
|
|
0.3
|
|
|
0.8
|
|
|||
Amortization of debt issuance costs
|
0.3
|
|
|
0.4
|
|
|
0.1
|
|
|||
Release of valuation allowance against deferred tax assets
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|||
Change in fair value of contingent consideration
|
(0.2
|
)
|
|
2.5
|
|
|
0.7
|
|
|||
Impairment of intangible assets
|
0.2
|
|
|
—
|
|
|
—
|
|
|||
Other non-cash expenses
|
—
|
|
|
0.2
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(16.3
|
)
|
|
(6.5
|
)
|
|
(7.0
|
)
|
|||
Inventory
|
(7.0
|
)
|
|
(1.6
|
)
|
|
0.7
|
|
|||
Prepaid and other assets
|
(0.4
|
)
|
|
(1.4
|
)
|
|
(0.8
|
)
|
|||
Restricted cash
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|||
Accounts payable and accrued liabilities
|
8.3
|
|
|
2.4
|
|
|
0.3
|
|
|||
Accrued payroll and related expenses
|
2.2
|
|
|
5.8
|
|
|
2.4
|
|
|||
Deferred revenue
|
—
|
|
|
(1.2
|
)
|
|
0.1
|
|
|||
Other liabilities
|
0.4
|
|
|
(0.3
|
)
|
|
0.5
|
|
|||
Net cash provided by (used in) operating activities
|
23.6
|
|
|
2.4
|
|
|
(33.1
|
)
|
|||
Investing activities
|
|
|
|
|
|
||||||
Purchase of available-for-sale marketable securities
|
(13.8
|
)
|
|
(16.3
|
)
|
|
(66.4
|
)
|
|||
Proceeds from the maturity of available-for-sale marketable securities
|
13.2
|
|
|
45.1
|
|
|
104.3
|
|
|||
Purchase of property and equipment
|
(16.2
|
)
|
|
(7.9
|
)
|
|
(9.5
|
)
|
|||
Net cash provided by (used in) investing activities
|
(16.8
|
)
|
|
20.9
|
|
|
28.4
|
|
|||
Financing activities
|
|
|
|
|
|
||||||
Net proceeds from issuance of common stock
|
24.0
|
|
|
12.0
|
|
|
3.6
|
|
|||
Net proceeds from issuance of long-term debt
|
—
|
|
|
—
|
|
|
6.6
|
|
|||
Repayment of long-term debt
|
(2.2
|
)
|
|
(0.2
|
)
|
|
—
|
|
|||
Net cash provided by financing activities
|
21.8
|
|
|
11.8
|
|
|
10.2
|
|
|||
Increase in cash and cash equivalents
|
28.6
|
|
|
35.1
|
|
|
5.5
|
|
|||
Cash and cash equivalents, beginning of period
|
43.2
|
|
|
8.1
|
|
|
2.6
|
|
|||
Cash and cash equivalents, ending of period
|
$
|
71.8
|
|
|
$
|
43.2
|
|
|
$
|
8.1
|
|
Supplemental disclosure of cash flow information
|
|
|
|
|
|
||||||
Cash paid during the year for interest
|
$
|
0.4
|
|
|
$
|
0.5
|
|
|
$
|
—
|
|
Supplemental disclosure of non-cash transactions
|
|
|
|
|
|
||||||
Issuance of common stock in connection with acquisition and contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6.1
|
|
Issuance of common stock in connection with contingent consideration settlement
|
$
|
4.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Years Ended December 31,
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Options outstanding to purchase common stock
|
3.1
|
|
|
5.8
|
|
|
7.4
|
|
Unvested restricted stock units
|
4.2
|
|
|
3.6
|
|
|
3.0
|
|
Total
|
7.3
|
|
|
9.4
|
|
|
10.4
|
|
|
December 31, 2014
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Estimated
Market
Value
|
||||||||
U.S. government agencies
|
$
|
9.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9.1
|
|
Corporate debt
|
2.3
|
|
|
—
|
|
|
—
|
|
|
2.3
|
|
||||
Commercial paper
|
0.4
|
|
|
—
|
|
|
—
|
|
|
0.4
|
|
||||
Total
|
$
|
11.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11.8
|
|
|
December 31, 2013
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Estimated
Market
Value
|
||||||||
U.S. government agencies
|
$
|
8.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8.9
|
|
Corporate debt
|
2.5
|
|
|
—
|
|
|
—
|
|
|
2.5
|
|
||||
Total
|
$
|
11.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11.4
|
|
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Accounts receivable
|
|
$
|
46.8
|
|
|
$
|
28.8
|
|
Less allowance for doubtful accounts, sales returns and discounts
|
|
(4.4
|
)
|
|
(2.7
|
)
|
||
Total
|
|
$
|
42.4
|
|
|
$
|
26.1
|
|
|
December 31,
|
||||||
|
2014
|
|
2013
|
||||
Raw materials
|
$
|
7.6
|
|
|
$
|
4.8
|
|
Work-in-process
|
1.0
|
|
|
0.3
|
|
||
Finished goods
|
7.4
|
|
|
3.9
|
|
||
Total
|
$
|
16.0
|
|
|
$
|
9.0
|
|
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Furniture and fixtures
|
|
$
|
3.9
|
|
|
$
|
2.6
|
|
Computer equipment
|
|
18.9
|
|
|
15.2
|
|
||
Machinery and equipment
|
|
26.5
|
|
|
19.0
|
|
||
Leasehold improvements
|
|
14.7
|
|
|
10.5
|
|
||
Total
|
|
64.0
|
|
|
47.3
|
|
||
Accumulated depreciation and amortization
|
|
(32.8
|
)
|
|
(26.6
|
)
|
||
Property and equipment, net
|
|
$
|
31.2
|
|
|
$
|
20.7
|
|
|
|
Weighted-Average
Amortization Period
(in months)
|
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Intangible Assets, net
|
||||||
Intangible assets subject to amortization
|
|
|
|
|
|
|
|
|
||||||
Developed technology
|
|
109
|
|
$
|
3.2
|
|
|
$
|
(1.2
|
)
|
|
$
|
2.0
|
|
Customer-related intangible
|
|
70
|
|
0.6
|
|
|
(0.3
|
)
|
|
0.3
|
|
|||
Covenants not-to-compete
|
|
70
|
|
0.2
|
|
|
(0.1
|
)
|
|
0.1
|
|
|||
Total
|
|
|
|
$
|
4.0
|
|
|
$
|
(1.6
|
)
|
|
$
|
2.4
|
|
Intangible assets not subject to amortization
|
|
|
|
|
|
|
|
|
||||||
In-process research and development
|
|
|
|
|
|
|
|
0.2
|
|
|||||
Trademarks and trade names
|
|
|
|
|
|
|
|
0.1
|
|
|||||
Goodwill
|
|
|
|
|
|
|
|
3.2
|
|
|||||
Total
|
|
|
|
|
|
|
|
$
|
3.5
|
|
|
|
Weighted-Average
Amortization Period
(in months)
|
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Intangible Assets, net
|
||||||
Intangible assets subject to amortization
|
|
|
|
|
|
|
|
|
||||||
Developed technology
|
|
109
|
|
$
|
3.2
|
|
|
$
|
(0.7
|
)
|
|
$
|
2.5
|
|
Customer-related intangible
|
|
70
|
|
0.6
|
|
|
(0.2
|
)
|
|
0.4
|
|
|||
Covenants not-to-compete
|
|
70
|
|
0.6
|
|
|
(0.2
|
)
|
|
0.4
|
|
|||
Total
|
|
|
|
$
|
4.4
|
|
|
$
|
(1.1
|
)
|
|
$
|
3.3
|
|
Intangible assets not subject to amortization
|
|
|
|
|
|
|
|
|
||||||
In-process research and development
|
|
|
|
|
|
|
|
0.2
|
|
|||||
Trademarks and trade names
|
|
|
|
|
|
|
|
0.1
|
|
|||||
Goodwill
|
|
|
|
|
|
|
|
3.2
|
|
|||||
Total
|
|
|
|
|
|
|
|
$
|
3.5
|
|
Fiscal Year Ending
|
|
||
2015
|
$
|
0.5
|
|
2016
|
0.5
|
|
|
2017
|
0.5
|
|
|
2018
|
0.3
|
|
|
2019
|
0.3
|
|
|
Thereafter through 2021
|
0.5
|
|
|
|
|
||
Total
|
$
|
2.6
|
|
|
|
|
December 31,
|
||||||
|
2014
|
|
2013
|
||||
Accounts payable trade
|
$
|
9.9
|
|
|
$
|
4.2
|
|
Accrued tax, audit, and legal fees
|
1.6
|
|
|
1.2
|
|
||
Clinical trials
|
0.4
|
|
|
0.3
|
|
||
Accrued other including warranty
|
8.5
|
|
|
4.8
|
|
||
Acquisition-related liabilities
|
—
|
|
|
3.6
|
|
||
Total
|
$
|
20.4
|
|
|
$
|
14.1
|
|
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Accrued paid time off
|
|
$
|
3.2
|
|
|
$
|
2.7
|
|
Accrued wages, bonus and taxes
|
|
12.5
|
|
|
11.3
|
|
||
Other accrued employee benefits
|
|
1.5
|
|
|
1.1
|
|
||
Total
|
|
$
|
17.2
|
|
|
$
|
15.1
|
|
|
Years Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
Beginning balance
|
$
|
0.9
|
|
|
$
|
0.3
|
|
Charges to costs and expenses
|
5.2
|
|
|
4.1
|
|
||
Costs incurred
|
(4.8
|
)
|
|
(3.5
|
)
|
||
Ending balance
|
$
|
1.3
|
|
|
$
|
0.9
|
|
|
Fair Value Measurements Using
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents
|
$
|
—
|
|
|
$
|
54.3
|
|
|
$
|
—
|
|
|
$
|
54.3
|
|
Marketable securities, available for sale
|
|
|
|
|
|
|
|
||||||||
U.S. government agencies
|
—
|
|
|
9.1
|
|
|
—
|
|
|
9.1
|
|
||||
Corporate debt
|
—
|
|
|
2.3
|
|
|
—
|
|
|
2.3
|
|
||||
Commercial paper
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
||||
Total marketable securities, available for sale
|
$
|
—
|
|
|
$
|
11.8
|
|
|
$
|
—
|
|
|
$
|
11.8
|
|
Restricted cash
|
$
|
1.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.0
|
|
|
Fair Value Measurements Using
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents
|
$
|
—
|
|
|
$
|
28.7
|
|
|
$
|
—
|
|
|
$
|
28.7
|
|
Marketable securities, available for sale
|
|
|
|
|
|
|
|
||||||||
U.S. government agencies
|
—
|
|
|
8.9
|
|
|
—
|
|
|
8.9
|
|
||||
Corporate debt
|
—
|
|
|
2.5
|
|
|
—
|
|
|
2.5
|
|
||||
Total marketable securities, available for sale
|
$
|
—
|
|
|
$
|
11.4
|
|
|
$
|
—
|
|
|
$
|
11.4
|
|
Restricted cash
|
$
|
1.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.0
|
|
Contingent consideration - liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.2
|
|
|
$
|
4.2
|
|
|
Twelve Months Ended
December 31, |
||||||
|
2014
|
|
2013
|
||||
Fair value measurement at the beginning of period
|
$
|
4.2
|
|
|
$
|
1.7
|
|
Changes in fair value measurement included in operating expenses
|
(0.2
|
)
|
|
2.5
|
|
||
Contingent consideration settled
|
(4.0
|
)
|
|
—
|
|
||
Fair value measurement at end of period
|
$
|
—
|
|
|
$
|
4.2
|
|
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Net operating loss carryforwards
|
|
$
|
132.2
|
|
|
$
|
132.8
|
|
Capitalized research and development expenses
|
|
5.0
|
|
|
7.2
|
|
||
Tax credits
|
|
9.0
|
|
|
7.3
|
|
||
Share-based compensation
|
|
15.5
|
|
|
12.2
|
|
||
Fixed and intangible assets
|
|
1.2
|
|
|
1.1
|
|
||
Other, net
|
|
7.0
|
|
|
5.4
|
|
||
Total gross deferred tax assets
|
|
169.9
|
|
|
166.0
|
|
||
Less: valuation allowance
|
|
(169.0
|
)
|
|
(164.7
|
)
|
||
Deferred tax liability related to acquired intangibles assets
|
|
(1.0
|
)
|
|
(1.4
|
)
|
||
Net deferred tax liability
|
|
$
|
(0.1
|
)
|
|
$
|
(0.1
|
)
|
|
|
December 31,
|
|||||||
|
|
2014
|
|
2013
|
|
2012
|
|||
Income taxes at statutory rates
|
|
35.00
|
%
|
|
35.00
|
%
|
|
35.00
|
%
|
State income tax, net of federal benefit
|
|
(1.56
|
)%
|
|
2.70
|
%
|
|
2.74
|
%
|
Permanent items
|
|
(0.80
|
)%
|
|
(3.64
|
)%
|
|
(0.84
|
)%
|
Research and development credits
|
|
7.50
|
%
|
|
6.17
|
%
|
|
1.43
|
%
|
Stock and officers compensation
|
|
(15.93
|
)%
|
|
(2.23
|
)%
|
|
(3.01
|
)%
|
Rate change
|
|
(1.66
|
)%
|
|
7.11
|
%
|
|
(2.13
|
)%
|
Other
|
|
(3.97
|
)%
|
|
0.08
|
%
|
|
(1.15
|
)%
|
Change in valuation allowance
|
|
(19.24
|
)%
|
|
(45.15
|
)%
|
|
(29.76
|
)%
|
|
|
(0.66
|
)%
|
|
0.04
|
%
|
|
2.28
|
%
|
|
|
||
Balance at January 1, 2012
|
$
|
4.4
|
|
Increases related to current year tax positions
|
0.5
|
|
|
Decreases due to statute of limitation expiration
|
(0.1
|
)
|
|
Balance at December 31, 2012
|
4.8
|
|
|
Adjustments related to prior year tax positions
|
0.5
|
|
|
Increases related to current year tax positions
|
0.9
|
|
|
Balance at December 31, 2013
|
6.2
|
|
|
Increases related to current year tax positions
|
1.4
|
|
|
Balance at December 31, 2014
|
$
|
7.6
|
|
|
|
Number of
Shares
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Remaining
Contractual
Term
(years)
|
|
Aggregate Intrinsic
Value
|
|||||
Outstanding at December 31, 2013
|
|
5.9
|
|
|
$
|
7.94
|
|
|
|
|
|
||
Exercised
|
|
(2.8
|
)
|
|
7.92
|
|
|
|
|
|
|||
Forfeited
|
|
—
|
|
|
11.53
|
|
|
|
|
|
|||
Outstanding at December 31, 2014
|
|
3.1
|
|
|
$
|
7.95
|
|
|
3.53
|
|
$
|
147.5
|
|
Exercisable at December 31, 2014
|
|
3.1
|
|
|
$
|
7.95
|
|
|
3.53
|
|
$
|
147.5
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Intrinsic value of options exercised
|
|
$
|
99.0
|
|
|
$
|
29.8
|
|
|
$
|
2.7
|
|
Fair value of options vested
|
|
$
|
0.4
|
|
|
$
|
1.3
|
|
|
$
|
3.7
|
|
|
|
Shares
|
|
Weighted Average
Grant Date
Fair Value
|
|||
|
|
(in millions)
|
|
|
|||
Nonvested at December 31, 2013
|
|
0.1
|
|
|
$
|
4.60
|
|
Vested
|
|
(0.1
|
)
|
|
4.60
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Nonvested at December 31, 2014
|
|
—
|
|
|
$
|
—
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Cost of sales
|
|
$
|
4.5
|
|
|
$
|
2.6
|
|
|
$
|
2.1
|
|
Research and development
|
|
17.0
|
|
|
8.5
|
|
|
6.2
|
|
|||
Selling, general and administrative
|
|
28.5
|
|
|
13.5
|
|
|
10.1
|
|
|||
Share-based compensation expense included in operating expenses
|
|
$
|
50.0
|
|
|
$
|
24.6
|
|
|
$
|
18.4
|
|
|
|
Years Ended December 31,
|
|||||
|
|
2014
|
|
2013
|
|
2012
|
|
Risk free interest rate
|
|
n/a
|
|
n/a
|
|
1.2
|
%
|
Dividend yield
|
|
n/a
|
|
n/a
|
|
—
|
%
|
Expected volatility of the Company’s stock
|
|
n/a
|
|
n/a
|
|
0.70
|
|
Expected life (in years)
|
|
n/a
|
|
n/a
|
|
6.1
|
|
|
|
Years Ended December 31,
|
|||||||
|
|
2014
|
|
2013
|
|
2012
|
|||
Risk free interest rate
|
|
0.10 – 0.12
|
|
|
0.13 – 0.17
|
|
|
0.11 – 0.19
|
|
Dividend yield
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Expected volatility of the Company’s stock
|
|
0.41 – 0.50
|
|
|
0.30 – 0.39
|
|
|
0.39 – 0.70
|
|
Expected life (in years)
|
|
1
|
|
|
1
|
|
|
1
|
|
|
|
Shares
|
|
Weighted Average
Grant Date
Fair Value
|
|
Aggregate
Intrinsic Value
|
|||||
Nonvested at December 31, 2013
|
|
3.6
|
|
|
$
|
15.13
|
|
|
|
||
Granted
|
|
2.6
|
|
|
46.19
|
|
|
|
|||
Vested
|
|
(1.8
|
)
|
|
15.47
|
|
|
|
|||
Forfeited
|
|
(0.2
|
)
|
|
28.10
|
|
|
|
|||
Nonvested at December 31, 2014
|
|
4.2
|
|
|
$
|
33.35
|
|
|
$
|
233.7
|
|
|
|
December 31,
|
||||
|
|
2014
|
|
2013
|
||
Stock options and awards under our plans:
|
|
|
|
|
||
Stock options granted and outstanding
|
|
3.1
|
|
|
5.9
|
|
Unvested restricted stock units
|
|
4.2
|
|
|
3.6
|
|
Reserved for future grant
|
|
0.3
|
|
|
0.5
|
|
Employee Stock Purchase Plan
|
|
2.5
|
|
|
2.6
|
|
Total
|
|
10.1
|
|
|
12.6
|
|
|
|
For the Three Months Ended
|
||||||||||||||
|
|
December 31
|
|
September 30
|
|
June 30
|
|
March 31
|
||||||||
Year ended December 31, 2014
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
84.3
|
|
|
$
|
69.0
|
|
|
$
|
58.8
|
|
|
$
|
47.1
|
|
Gross profit
|
|
59.4
|
|
|
47.2
|
|
|
39.9
|
|
|
29.8
|
|
||||
Total operating expenses
|
|
57.8
|
|
|
52.2
|
|
|
45.7
|
|
|
42.1
|
|
||||
Net income (loss)
|
|
1.3
|
|
|
(5.2
|
)
|
|
(6.0
|
)
|
|
(12.5
|
)
|
||||
Basic net income (loss) per share (a)
|
|
$
|
0.02
|
|
|
$
|
(0.07
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(0.17
|
)
|
Diluted net income (loss) per share (a)
|
|
$
|
0.02
|
|
|
$
|
(0.08
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.17
|
)
|
Year ended December 31, 2013
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
51.7
|
|
|
$
|
42.9
|
|
|
$
|
35.8
|
|
|
$
|
29.6
|
|
Gross profit
|
|
34.1
|
|
|
27.6
|
|
|
21.9
|
|
|
16.5
|
|
||||
Total operating expenses
|
|
36.4
|
|
|
33.4
|
|
|
31.8
|
|
|
27.4
|
|
||||
Net loss
|
|
(2.6
|
)
|
|
(6.0
|
)
|
|
(10.1
|
)
|
|
(11.1
|
)
|
||||
Basic and diluted net loss per share
|
|
$
|
(0.04
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.16
|
)
|
|
|
||
Allowance for doubtful accounts
|
|
||
Balance December 31, 2011
|
$
|
0.6
|
|
Provision for doubtful accounts
|
1.2
|
|
|
Write-off and adjustments
|
(0.7
|
)
|
|
Recoveries
|
0.1
|
|
|
Balance December 31, 2012
|
$
|
1.2
|
|
|
|
||
Allowance for doubtful accounts
|
|
||
Balance December 31, 2012
|
$
|
1.2
|
|
Provision for doubtful accounts
|
2.7
|
|
|
Write-off and adjustments
|
(1.4
|
)
|
|
Recoveries
|
0.1
|
|
|
Balance December 31, 2013
|
$
|
2.6
|
|
|
|
||
Allowance for doubtful accounts
|
|
||
Balance December 31, 2013
|
$
|
2.6
|
|
Provision for doubtful accounts
|
4.0
|
|
|
Write-off and adjustments
|
(2.6
|
)
|
|
Recoveries
|
0.3
|
|
|
Balance December 31, 2014
|
$
|
4.3
|
|
|
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
2
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
3
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
4
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
5
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
6
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
7
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
8
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
9
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
10
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
Period
|
Annualized
Base Rent |
Monthly
Installment of Base Rent** |
Approximate Monthly
Rental Rate per Rentable Square Foot |
December 1, 2016 to
November 30, 2017 |
$2,782,404.00
|
$231,867.00*
|
$1.800
|
December 1, 2017 to
November 30, 2018 |
$2,872,832.16
|
$239,402.68
|
$1.859
|
December 1, 2018 to
November 30, 2019 |
$2,966,199.12
|
$247,183.26
|
$1.919
|
December 1, 2019 to
November 30, 2020 |
$3,062,600.64
|
$255,216.72
|
$1.981
|
December 1, 2020 to
November 30, 2021 |
$3,162,135.12
|
$263,511.26
|
$2.046
|
December 1, 2021 to
New Expiration Date |
$3,264,904.56
|
$272,075.38
|
$2.112
|
*
Subject to abatement as provided in
Section 4.3
below.
** Based upon 3.25% annual increases.
|
|
-
11
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
Year of New Expansion Term |
Annualized Base Rent |
Monthly
Installment of Base Rent*** |
Approximate Monthly
Rental Rate per Rentable Square Foot |
|
|
1**
|
$972,000.00◊
|
$81,000.00*◊
|
$1.800
|
|
|
2**
|
$1,003,590.00
|
$83,632.50
|
$1.859
|
|
|
3
|
$2,072,520.00
|
$172,710.00
|
$1.919
|
|
|
4
|
$2,139,876.96
|
$178,323.08
|
$1.981
|
|
|
5
|
$2,209,422.84
|
$184,118.57
|
$2.046
|
|
|
6
|
$2,281,229.16
|
$190,102.43
|
$2.112
|
|
|
7
|
$2,355,369.12
|
$196,280.76
|
$2.181
|
|
* If the Expansion Commencement Date falls on a day of the month which is not the first day of such month, the Base Rent for such fractional month shall accrue on a daily basis and shall total an amount equal to the product of (i) a fraction, the numerator of which is the number of days in such fractional month and the denominator of which is the actual number of days occurring in such calendar month, and (ii) the then-applicable monthly installment of Base Rent. Such fractional month shall be added to the first year of the New Expansion Term.
|
|
||||
** The foregoing schedule assumes the 6290 Must-Take Premises Commencement Date occurs on the date which is two (2) years after the Expansion Commencement Date. To the extent the 6290 Must-Take Premises Commencement Date occurs prior to such date, and/or extent Tenant elects to commence Business Operations in increments of the 6290 Must-Take Premises prior to such date, the foregoing schedule shall be updated.
|
|
||||
*** Based upon 3.25% annual increases.
|
|
||||
◊ Subject to abatement as set forth in
Section 4.3
below.
|
|
|
-
12
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
13
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
14
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
15
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
16
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
17
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
18
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
19
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
20
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
21
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
22
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
-
23
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
"LANDLORD":
|
|
"TENANT":
|
|
KILROY REALTY, L.P.,
|
|
DEXCOM, INC.,
|
|
a Delaware limited partnership
|
|
a Delaware corporation
|
|
By:
|
/s/ Robert E. Palmer
|
By:
|
/s/ Kevin Sayer
|
|
Robert E. Palmer
|
|
Kevin Sayer
|
|
Senior Vice President, Operations
|
|
President and Chief Operating Officer
|
|
|
|
|
By:
|
/s/ John T. Fucci
|
By:
|
/s/ Jess Roper
|
|
John T. Fucci
|
|
Jess Roper
|
|
Senior Vice President, Asset Management
|
|
Chief Financial Officer
|
|
-
24
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT A
-1-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
-1-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 2 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 3 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 4 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 5 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 6 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 7 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 8 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 9 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 10 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT B
- 11 - |
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
d.
|
R11 batt sound insulation in partition cavity (portion of walls – corridor, bathrooms & some office).
|
g.
|
Provide minimum opening above ceiling as required for return air, with sound boots.
|
b.
|
1 layer each side 5/8" thick type ‘x’ gypsum wallboard. From floor slab to underside of ceiling grids as applicable. Height may vary.
|
c.
|
Diagonal Bracing: 2-1/2" x 25 gauge metal studs at 45 degree diagonal to structure above staggered @ 4’-0" on center, and at door openings.
|
d.
|
Partition taped and sanded smooth to receive paint to a minimum of Level 4 finish.
|
e.
|
Metal corner bead at terminations of partitions and at the ceiling.
|
f.
|
All demising walls and tenant conference room walls to receive R-11 batt insulation within partition cavity and four foot on either side of partition over ceiling.
|
a.
|
Same as demising partition with fire dampers as required for penetrations and return air.
|
a.
|
2-1/2" x 25 gauge metal studs @ 16" on center.
|
b.
|
1 layer each side and top 5/8" thick type ‘x’ gypsum wallboard.
|
c.
|
Heights vary to maximum of 68" above floor.
|
d.
|
Metal corner beads at all exposed corners.
|
e.
|
Partition taped and sanded smooth to receive paint to a minimum of Level 4 finish.
|
f.
|
Pipe support at free end within partition cavity and every 4’ on center.
|
|
SCHEDULE 1 TO EXHIBIT B
-
1
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
d.
|
Partition taped and sanded smooth to receive paint to a minimum of Level 4 finish.
|
a.
|
Single leaf U.L. rated, 20-minute suite entry door label attached to hinge side of door, 1-3/4" x 3’-0" x 8’-10", solid core wood, clear plain sliced select white maple, book matched edges. Door shall be pre-finished and pre-mortised for hardware.
|
b.
|
Frame: 3’-0" x 8’-10" " Western Integrated prefinished satin aluminum with clear coat with squared edge, 20-minute fire rated.
|
c.
|
Hardware: Butts: two pair per door, Hager 700; Door Hardware: Schlage "L" Series, Lever style #17, A- Wrought Rose- typ.; Entrance Lockset # L9453P-626, Latchset # L9010P-626, and Office Lockset # L9050-626; Door Stop: Hager 236W, concave wall stop; Closer: LCN #1461FC (where required); typical hardware finish: satin aluminum or satin stainless steel throughout unless otherwise noted.
|
d.
|
Closer at entry doors and any rated doors required by code: LCN 1460 Series, 4111 cylinder for accessibility.
|
a.
|
Double leaf U.L. rated 20-minute suite entry doors with label attached to hinge side of doors, 1-3/4" x 6’-0" x 8’-10", solid core wood, clear plain sliced select white maple, book matched edges. Door shall be pre-finished and pre-mortised for hardware. Book match face veneers with premium veneers grade of doors with matching veneer at vertical edge.
|
b.
|
Door shall be pre-finished and mortised for hardware.
|
c.
|
Frame: 6’-0" x 8’-10", ‘Western Integrated’ prefinished satin aluminum with clear coat with squared edge, 20-minute fire rated.
|
d.
|
Hardware: Same as above modified and supplemented for double doors.
|
a.
|
Single leaf, 1-3/4" x 3’-0" x 8’-10", solid core wood, 5 ply, plain sliced maple veneer, clear finish and premium grade.
|
b.
|
Matching veneer at vertical edges.
|
c.
|
20-minute rated with label attached to hinge side of door.
|
d.
|
Door shall be prefinished and mortised for hardware.
|
e.
|
Frame: 3’-0" x 8’-10", ‘Western Integrated’ flush trim clear anodized extruded aluminum, 20-minute fire rated.
|
|
SCHEDULE 1 TO EXHIBIT B
-
2
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
f.
|
Hardware: Schlage "L" Series:
Lever style #17, A- Wrought Rose, finish 626 satin chrome. Corbin Russwin cylinders with an inter-changeable core and keyway. Hinges: AB700, 4.5 x 4.5, ‘Hager’, finish: stainless steel – satin. Stop: ‘Trimco’ 1211 series, finish 626.
|
g.
|
Sidelights shall be provided at all private offices as applicable.
|
a.
|
Double leaf, 1-3/4" x 6’-0" x 8’-10", solid core wood, 5 ply, plain sliced maple veneer, clear finish and premium grade.
|
b.
|
Match face veneers of doors. Matching veneer at vertical edges.
|
c.
|
20-minute rated with label attached to hinge side of the door.
|
d.
|
Door shall be prefinished and mortised for hardware.
|
e.
|
Frame: 6’-0" x 8’-10", ‘Western Intgrated’ flush trim clear anodized extruded aluminum, 20-minute fire rated.
|
f.
|
Hardware: Schlage "L" Series:
Lever style #17, A- Wrought Rose- typ, finish 626 hardware finish 626 satin chrome. Corbin Russwin cylinders with an inter-changeable core and D3 keyway. Hinges: AB700, 4.5 x 4.5, ‘Hager’, finish: stainless steel – satin. Stop: ‘Trimco’ 1211 series, finish 626. Auto flush bolts: DCI No. 942, finish to match 626. Coordinator: DCI No. 600 series, finish to match 626. Closer: LCN 4041 series, parallel arm-heavy duty, finish: to match 626. Closer: LCN 4041 series, parallel arm-heavy duty, finish to match 626. Astragal: ‘Pemco’ 355CV.
|
•
|
Premium Grade wood doors with single glass lites with a stained and lacquered finish. Colors to match building standard, subject to Landlord Approval
|
•
|
Herculite Glass Doors with Stainless Steel Styles at top and bottom and concealed hinges.
|
•
|
Aluminum Storefront Doors with clear anodized finish set in Aluminum frames to match.
|
a.
|
2’ X 2’ x 9/16" Armstrong, Superfine XL 9/16" exposed tee system, finish: matte white, Steel T-bar grid system with wire suspension and seismic bracing per code.
|
b.
|
Tile: 24" X 24" X 7/8" Armstrong acoustical tile; Pattern - Dune with tegular edge detail: Color - white.
|
c.
|
Optional Ceiling Tile and Grid as Selected by the Tenant for the tenant’s interior space may be submitted as outlined below subject to Landlords Approval.
|
d.
|
Premium Grade Architectural Ceiling Tile and Grid subject to code compliance with textures and finishes as selected by tenant, subject to Landlord Approval.
|
e.
|
Tenant may elect to design an open ceiling plan subject to Landlords Approval.
|
f.
|
Open Ceilings may incorporate the following:
|
•
|
Floating Architectural Ceilings with Composo Edges and trims.
|
•
|
Floating Hard lid ceilings.
|
•
|
Painted and Exposed Structure for Loft Style Architectural Impact.
|
|
SCHEDULE 1 TO EXHIBIT B
-
3
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
a.
|
Recessed Columbia 2x4 Direct/Indirect Fluorescent Fixture. (Verify and Match existing)
|
a.
|
STR24-2326-MPO-EB8277
|
b.
|
Micro Perforated Mesh Lamp Shield.
|
c.
|
(2) T-8 lamps per fixture with electronic rapid start ballast
|
d.
|
Lamps: Phillips 32 Watt
|
e.
|
Color 3500K
|
b.
|
Recessed Columbia 2x2 Direct/Indirect Fluorescent Fixture. (Verify and Match existing)
|
a.
|
STR22-217G-MPO-EB8277
|
b.
|
Micro Perforated Mesh Lamp Shield.
|
c.
|
(2) T-8 lamps per fixture with electronic rapid start ballast
|
d.
|
Lamps: (2) 17w WT8-82CRI
|
e.
|
Color 3500K
|
c.
|
Delray Rocket II Pendant Hung Compact Fluorescent Light Fixtures
|
d.
|
Verve II Suspended Linear Indirect Fixture
|
a.
|
Novitas Sensors.
|
b.
|
Wall - #01-DL401.
|
c.
|
Ceiling: One Way 01-100.
|
d.
|
Ceiling: Two Way 01-110
|
|
SCHEDULE 1 TO EXHIBIT B
-
4
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
a.
|
Specification Grade, Leviton 15A, 125V, Decora/single switch.
|
c.
|
Mounted vertically.
|
d.
|
Outlet height at 15" above finish floor to centerline of outlet U.O.N. as required for ADA compliance.
|
a.
|
Mud ring cut into wall - mounted vertically.
|
b.
|
¾" metal conduit stub above ceiling with 6" pigtail at top of wall.
|
c.
|
Cover plate and wiring by Tenant’s telephone vendor.
|
a.
|
Alkco Edge-Glo Exit /Directional signs, recessed ceiling mounted LED housing, green letters on a clear panel background or equivalent.
|
b.
|
Provide exit lights with battery back up at all exits required by code.
|
c.
|
All life safety items including horns & strobes and speaker shall have white covers.
|
a.
|
Fully fire sprinklered building with main and branch distribution lines available for tenant modification.
|
b.
|
Reliable sprinkler model "G" pendant semi-recessed sprinkler with white sprinkler and escutcheon.
|
•
|
165 degree Fahrenheit temperature rating.
|
c.
|
Reliable sprinkler model "G4" concealed sprinkler head with white cover plate. (To be used in all public areas).
|
•
|
165 degree Fahrenheit temperature rating.
|
|
SCHEDULE 1 TO EXHIBIT B
-
5
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
•
|
Lay-in tile ceiling diffusers.
|
•
|
Architectural air-bar linear diffusers.
|
•
|
Light troffer diffusers.
|
a.
|
"Elkay" Pacemaker sink # PSR-1720 - stainless steel, two faucet holes, or equivalent.
|
b.
|
Hi-Arc Dual Handle bar faucet by "Elkay" # LK-2437-BH or equivalent.
|
c.
|
Undercounter Dishwasher: Asko model #D1706, suitable for ADA requirements.
|
d.
|
Garbage Disposal: Insinkerator, Model #77, ¾ horsepower, stainless steel construction.
|
a.
|
Shall be Western Integrated aluminum, 3-3/4" or 4-7/8" throat, pre-finished satin aluminum w/ clear coat with squared edge- to match standard door frames style and color.
|
b.
|
¼" glazing, clear, tempered where required by code.
|
c.
|
Side-lite glazing, size: 1’-6" wide by full height (inside window frame to window frame)
|
d.
|
All private office shall have side-lites.
|
a.
|
Manufacturer: As approved Landlord.
|
c.
|
Include paint on tenant side of demising partition, both sides of interior partition, above and below exterior glazing as required and all column fur outs and perimeter walls.
|
a.
|
Carpet: Loop: 28 oz. or equal, Manufacture as approved Landlord.
|
b.
|
Direct glue down installation for all carpet.
|
|
SCHEDULE 1 TO EXHIBIT B
-
6
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
a.
|
Ceramic tile or Natural stone as selected by tenant subject to Landlord’s approval.
|
a.
|
2-1/2" Rubber Base by Roppe
|
b.
|
2 ½" tile base in tiled areas as approved by Landlord.
|
a.
|
Exterior window covering to be PVC Perforated Vertical Blinds.
|
b.
|
Blinds to be sized to fit inside window module.
|
c.
|
MechoShade –With Landlord’s prior approval, manually operated units are to receive ThermoVeil 0900 Series Privacy Weave ShadeCloth with an approximate openness factor of 0-1%. Color is to match (0910 Light Grey) the fabric used on the shades.
|
|
SCHEDULE 1 TO EXHIBIT B
-
7
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
•
|
Remove compressed air, nitrogen, and vacuum lines throughout the building as well as the associated systems.
|
•
|
Remove ceiling receptacles throughout lab space.
|
•
|
Remove security systems including card access and cameras.
|
•
|
Remove supplemental HVAC systems that are not in good working order as of the New Expiration Date, as the same may be extended (but Tenant shall have no obligation to remove any of the associated steel roof supports).
|
|
SCHEDULE 2 TO EXHIBIT B
-
1
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT C
-
1
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT C
-
2
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT C
-
3
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
EXHIBIT D
-
1
-
|
SEQUENCE TECHNOLOGY CENTER
[Expansion and Extension Amendment] [DexCom, Inc.] |
|
|
SUBSIDIARY
(Name under which subsidiary does business)
|
JURISDICTION OF
INCORPORATION
|
DXCM Sweden AB
|
Sweden
|
SweetSpot Diabetes Care, Inc.
|
Delaware
|
|
|
|
|
February 25, 2015
|
By:
|
|
/s/ Kevin R. Sayer
|
|
|
|
Kevin R. Sayer
|
|
|
|
President & Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
February 25, 2015
|
By:
|
|
/s/ Jess Roper
|
|
|
|
Jess Roper
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
/s/ Kevin R. Sayer
|
Kevin R. Sayer
|
President & Chief Executive Officer
|
(Principal Executive Officer)
|
|
/s/ Jess Roper
|
Jess Roper
|
Chief Financial Officer
|
(Principal Financial and Accounting Officer)
|