Item 1.01Entry into a Material Definitive Agreement
As previously disclosed, on June 10, 2019, Insys Therapeutics, Inc. (the
"Company") and its subsidiaries (collectively, the "Debtors") filed voluntary
petitions (the "Bankruptcy Petitions," and the cases commenced thereby, the
"Chapter 11 Cases") for relief under chapter 11 of title 11 of the United States
Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court"). Also as previously disclosed, on
July 2, 2019, the Bankruptcy Court entered an order that, among other things,
established bidding procedures to sell substantially all of the Debtors' assets
in accordance with Section 363 of the Bankruptcy Code.
As previously disclosed, on October 31, 2019, the Company and Benuvia
Therapeutics Inc. (then known as Chilion Group Holdings US, Inc.) ("Benuvia")
entered into a Transition Services Agreement (as amended, modified and/or
supplemented from time to time, the "Transition Services Agreement"), pursuant
to which the Company agreed to make available to Benuvia (or its affiliates or
designee(s)) certain employees of the Company and/or its affiliates (the
"Employees") for the purpose of providing certain transition services in
consideration for Benuvia's payment to the Company or its designee(s) of fees at
the Company's cost plus a seven and one-half percent (7.5%) mark-up. The term of
the Transition Services Agreement commenced on October 31, 2019 and was to
continue through December 31, 2019, unless earlier terminated or extended in
accordance with the terms of the Transition Services Agreement. Also as
previously disclosed, on December 30, 2019, the Company and Benuvia entered into
an Amendment to Transition Services Agreement (the "TSA Amendment"), which
amended the Transition Services Agreement to, among other things, extend the
term of the Transition Services Agreement to continue through January 31, 2020
and provide that Benuvia would be solely responsible for all costs and expenses
associated with the Employees.
On January 30, 2020, the Company and Benuvia entered into a Second Amendment to
Transition Services Agreement (the "Second TSA Amendment"), which amends the
Transition Services Agreement to, among other things, further extend the term of
the Transition Services Agreement to continue through the earlier of: (i) the
date on which all powers of attorney that are required for Benuvia to operate
under the Company's existing manufacturing and analytical laboratory
registrations issued by the Drug Enforcement Administration and applicable state
agencies, including those related to the Round Rock and Ellis facilities leased
by Benuvia, have been duly executed and have become effective, and (ii) the date
on which Benuvia has obtained all necessary approvals from governmental
entities, including the Drug Enforcement Administration and applicable state
agencies, and third-party providers, unless the Transition Services Agreement is
earlier terminated in accordance with its terms. The Second TSA Amendment also
provides that Benuvia continues to be solely responsible for all costs and
expenses associated with the Employees.
The foregoing descriptions of the Transition Services Agreement, the TSA
Amendment and the Second TSA Amendment do not purport to be complete and are
subject to, and qualified in their entirety by reference to, respectively, the
full text of the Transition Services Agreement filed as Exhibit 2.1 to the
Current Report on Form 8-K that was filed with the U.S. Securities and Exchange
Commission (the "SEC") on November 4, 2019, the TSA Amendment filed as Exhibit
2.1 to the Current Report on Form 8-K that was filed with the SEC on January 6,
2020, and the Second TSA Amendment attached hereto as Exhibit 2.1, all of which
are incorporated herein by reference.
Cautionary Statements Regarding Trading in the Company's Securities
The Company cautions that trading in the Company's securities during the
pendency of the Chapter 11 Cases is highly speculative and poses substantial
risks. Trading prices for the Company's securities may bear little or no
relationship to the actual recovery, if any, by holders of the Company's
securities in the Chapter 11 Cases. As previously disclosed, on the effective
date of the Second Amended Joint Chapter 11 Plan of Liquidation of Insys
Therapeutics, Inc. and Its Affiliated Debtors that was confirmed by the
Bankruptcy Court on January 16, 2020 (as further amended, supplemented or
modified in accordance with its terms, the "Plan"), all existing shares of the
Company's common stock will be cancelled.
Cautionary Statements Regarding Forward-Looking Information
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This Current Report on Form 8-K includes "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. In some cases,
you can identify forward-looking statements by terminology such as "may,"
"will," "should," "could," "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential," "continue," "intend" or the negative of
these terms or other comparable terminology, although not all forward-looking
statements contain these identifying words. All statements, other than
statements of historical facts, included in this filing that address activities,
events or developments that the Company expects, believes, targets or
anticipates will or may occur in the future are forward-looking statements. The
Company's actual results may differ materially from those anticipated in these
forward-looking statements as a result of certain risks and other factors, which
could include the following: risks and uncertainties relating to the Chapter 11
Cases, including but not limited to, the terms of and potential transactions
contemplated by the Plan and the related disclosure statement, the Company's
ability to obtain Bankruptcy Court approval with respect to motions in the
Chapter 11 Cases, the effects of the Chapter 11 Cases on the Company and on the
interests of various constituents, Bankruptcy Court rulings in the Chapter 11
Cases and the outcome of the Chapter 11 Cases in general, risks associated with
third-party motions in the Chapter 11 Cases, the potential adverse effects of
the Chapter 11 Cases on the Company's liquidity or results of operations and
increased legal and other professional costs necessary to execute the Company's
reorganization; uncertainty associated with the Company's ability to complete
the sale of its remaining assets as contemplated by the Bankruptcy Petitions;
trading price and volatility of the Company's common stock as well as other risk
factors set forth in the Company's Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q filed with the SEC in addition to those factors, risks and
uncertainties described in more detail in the Company's risk factors set forth
in Exhibit 99.1 to the Current Report on Form 8-K filed by the Company with the
SEC on August 8, 2019. The Company therefore cautions readers against relying on
these forward-looking statements. All forward-looking statements attributable to
the Company or persons acting on the Company's behalf are expressly qualified in
their entirety by the foregoing cautionary statements. All such statements speak
only as of the date made, and, except as required by law, the Company undertakes
no obligation to update or revise publicly any forward-looking statements,
whether as a result of new information, future events or otherwise.
Additional Information Regarding the Chapter 11 Cases
Bankruptcy Court filings and other information related to the Chapter 11 Cases
are or will be available at a website administered by the Company's noticing and
claims agent, Epiq Corporate Restructuring, LLC, at https://dm.epiq11.com/Insys.
Information contained on, or that can be accessed through, such website or the
Bankruptcy Court's website is not part of this Current Report.
Item 9.01Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. Description
2.1 Second Amendment to Transition Services Agreement, dated as of
January 30, 2020, by and between Benuvia Therapeutics Inc. and
Insys Therapeutics, Inc.
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