Unilife Corporation (NASDAQ: UNIS; ASX: UNS) today announced that it has commenced a formal proceeding to restructure its balance sheet or to sell its assets as a going concern in order to better position the business for the future. To facilitate this restructuring or sale, the Company filed voluntary petitions under chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the "Court"). Unilife's foreign affiliates in Australia are not included in the filing but are expected to be included in the restructuring or sale. Unilife's operations will remain ongoing during the chapter 11 process.
The Company has obtained a commitment for a $7 million debtor-in-possession ("DIP") financing facility underwritten by an affiliate of OrbiMed Advisors. Subject to Court approval, this DIP financing, combined with the Company's cash from operations, is expected to provide sufficient liquidity during the chapter 11 cases to support the company's continuing business operations and minimize disruption.
"We have conducted an extensive review of alternatives to address Unilife's capital structure, and we believe pursuing a balance sheet restructuring or sale through chapter 11 is the best path forward at this time," said John Ryan, Chief Executive Officer of Unilife. "We expect that restructuring Unilife's balance sheet or the sale of its assets as a going concern through the chapter 11 process will best position Unilife's business for future success."
As part of Unilife's comprehensive assessment of options to address its capital structure, the company, in consultation with its financial and legal advisors, has determined to simultaneously pursue both a balance sheet restructuring of its debt and equity and a going concern sale of its assets.
"This is a critical step in our ongoing transformation to a successful wearable injector-focused business. Unilife's current capital structure was put in place to support our business model as a diffuse drug delivery system company, and our business has evolved significantly as we have focused on our wearable injector technology. Now, in light of the terms of the company's debt obligations and its inability to continue to finance the business outside of bankruptcy, we need to restructure the company's debt and equity or sell the assets as a going concern," continued Mr. Ryan.
"We are fortunate to have a world-class group of employees focused on developing our industry-leading wearable injectors, and we are confident that our business can emerge from this process ready to focus on delivering for our customers and their patients. We are keenly focused on minimizing disruption to our customers, partners, and employees and do not expect to experience any material disruptions during the chapter 11 proceedings."
Contemporaneously with the filing of the voluntary petitions, the Company filed a number of "first-day" motions with the Court designed to facilitate a smooth transition into chapter 11 and minimize any business disruption. Among other things, the motions request authorization to obtain financing to continue certain customer and partner programs, and to honor certain employee compensation and benefit obligations.
SSG Capital Advisors, LLC is the Company's restructuring advisor and M&A investment banker. Cozen O'Connor is the Company's restructuring counsel and Duane Morris LLP is the Company's corporate counsel.
For more information about the chapter 11 cases, including access to Court documents, please visit: http://www.omnimgt.com/unilife.
About Unilife Corporation
Unilife Corporation (NASDAQ:UNIS / ASX: UNS) is a U.S.-based developer and commercial supplier of injectable drug delivery systems. Unilife has a portfolio of innovative, differentiated products with a primary focus on wearable injectors. Products within each platform are customizable to address specific customer, drug and patient requirements. For more information, visit www.unilife.com.
