LAKE FOREST, Ill., Feb. 12, 2020 /PRNewswire/ -- Akorn, Inc.
(Nasdaq: AKRX), a leading specialty pharmaceutical company, today
announced it has reached an agreement with certain of its lenders
to extend the standstill period. The agreement defines a path
forward and outlines milestones to execute a sale of Akorn's
business, potentially using Chapter 11 protection in order to
address Akorn's litigation-related overhangs and execute a
transaction that maximizes value.
Doug Boothe, Akorn's President
and Chief Executive Officer, commented, "Akorn is a fundamentally
strong business with exciting opportunities ahead. Our efforts to
stabilize and strengthen our business have already achieved
meaningful results. The decision to pursue a sale of the Company
gives Akorn the opportunity to address its capital structure and
litigation-related overhangs by seeking a new owner that will
continue to invest in our business and future growth. I believe
that this decisive action is the right path for our business and
will deliver greater financial security in the long term."
The Company plans to continue to operate as usual throughout the
sale process, including delivering safe and effective
pharmaceutical products to customers and fulfilling contractual
obligations, including payments to vendors.
A copy of the amendment was filed with the SEC on the Company's
Form 8-K today.
About Akorn
Akorn, Inc. is a specialty pharmaceutical company engaged in
the development, manufacture and marketing of multisource and
branded pharmaceuticals. Akorn has manufacturing
facilities located in Decatur, Illinois; Somerset, New
Jersey; Amityville, New York;
Hettlingen, Switzerland and Paonta
Sahib, India that manufacture ophthalmic, injectable and
specialty sterile and non-sterile pharmaceuticals. Additional
information is available on Akorn's website
at www.akorn.com.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains forward-looking
statements, including statements regarding a path and milestones
for executing a sale of Akorn's business, potential Chapter 11
protection, addressing litigation-related overhangs, maximization
of value, investment in the business and future growth, greater
financial security in the long-term, continuing to operate as usual
throughout the sale. When used in this document, the words "will,"
"target," "expect," "continue," "believe," "seek, "anticipate,"
"estimate," "intend," "could," "would," "strives" and similar
expressions are generally intended to identify forward-looking
statements. These statements are made pursuant to the safe harbor
provisions of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. A number of important factors could cause actual results
of the Company and its subsidiaries to differ materially from those
indicated by such forward-looking statements. These factors
include, but are not limited to: (i) the effect of the
Delaware Court of Chancery's
October 1, 2018 decision against the
Company and the Delaware Supreme Court's December 7, 2018 order affirming the Chancery
Court's decision on the Company's ability to retain and hire key
personnel, its ability to maintain relationships with its
customers, suppliers and others with whom it does business, or its
operating results and business generally, (ii) the risk that
ongoing or future litigation against the defendants or related to
the court's decision may result in significant costs of defense,
indemnification and/or liability, (iii) the outcome of the
investigation conducted by the Company, with the assistance of
outside consultants, into alleged breaches of FDA data integrity
requirements relating to product development at the Company and any
actions taken by the Company, third parties or the FDA as a result
of such investigations, (iv) the difficulty of predicting the
timing or outcome of product development efforts, including FDA and
other regulatory agency approvals and actions, if any, (v) the
timing and success of product launches, (vi) difficulties or delays
in manufacturing, (vii) the Company's increased indebtedness and
obligation to comply with certain covenants and other obligations
under its standstill agreement with its first lien term loan
lenders (the "Standstill Agreement"), which create material
uncertainties and risks to its growth and business
outlook, (viii) the Company's obligation under the Standstill
Agreement to pay certain fees and expenses and increased interest
margin, (ix) the Company's exploration of strategic alternatives,
including the alternatives of seeking to restructure its
indebtedness and/or implement a strategic transaction (including a
sale of its assets) with the protections of a filing under Chapter
11 of the U.S. Bankruptcy Code, (x) the risk that the holders of a
significant number of shares have opted out of and elected not to
participate in or be bound by the settlement agreement with the
putative class members in the pending securities class action (the
"Settlement Agreement"), (xi) the risk that the Settlement
Agreement may not obtain the necessary approval by the court or may
be terminated in accordance with its terms, (xii) the risk that
insurance proceeds, common shares or other consideration
contemplated to be exchanged pursuant to the proposed settlement is
not available at the appropriate time and (xiii) such other risks
and uncertainties outlined in the risk factors detailed in Part I,
Item 1A, "Risk Factors," of the Company's Annual Report on Form
10-K for the fiscal year ended December 31,
2018 (as filed with the Securities and Exchange Commission
("SEC") on March 1, 2019) and in Part
II, Item 1A, "Risk Factors," of the Company's Quarterly Reports on
Form 10-Q for the fiscal quarters ended March 31, 2019 (as filed with the SEC on
May 9, 2019), June 30, 2019 (as filed with the SEC on
August 2, 2019) and September 30, 2019 (as filed with the SEC on
October 31, 2019) and other risk
factors identified from time to time in the Company's filings with
the SEC. Readers should carefully review these risk factors, and
should not place undue reliance on the Company's forward-looking
statements. These forward-looking statements are based on
information, plans and estimates at the date of this Current Report
on Form 8-K. The Company undertakes no obligation to update any
forward-looking statements to reflect changes in underlying
assumptions or factors, new information, future events or other
changes.
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SOURCE Akorn, Inc.