Inotiv, Inc. Files Chapter 11; Enters Restructuring Support Agreement

What Happened
Inotiv, Inc. announced on June 2–3, 2026 that it entered a Restructuring Support Agreement with key lenders and noteholders and filed voluntary Chapter 11 petitions on June 3, 2026 to implement the agreed restructuring plan. The plan contemplates a $65.4 million debtor-in-possession (DIP) financing and conversion to an exit term loan facility on emergence, along with a restructuring of prepetition debt and cancellation of existing equity.

Key Details

• Chapter 11 filing date: June 3, 2026; solicitation and Disclosure Statement commenced June 2, 2026.
• DIP Facility: $65.4 million total ( $25.0M new-money senior secured term loans + $40.4M roll-up of prepetition delayed draw loans); interest = SOFR + 9.00% or Alternate Base Rate + 8.00%; 90‑day maturity (subject to lender consent to extend).
• Exit financing: reorganized company expected to enter up to $150 million senior secured first-lien exit term loan (includes PIK, fees, OID). All DIP claims to convert dollar-for-dollar into exit term loans.
• Creditor recoveries: holders of allowed prepetition first‑lien claims to receive ~93% of new equity; PIK noteholders to receive a pro rata share equal to 21% of a defined “Notes Recovery” (including 7% of New Equity and New Warrants); unsecured convertible noteholders to receive 79% of the Notes Recovery.
• Equity and warrants: all existing equity cancelled with no distribution; reorganized company to issue New Equity and New Warrants representing 11% of New Equity (fully diluted), warrants priced off a $350M implied post‑transaction enterprise value and exercisable for four years. Management incentive pool up to 10% of New Equity (fully diluted).
• Milestones: petition/commencement by June 3, 2026; interim DIP/case scheduling order within 3 days of petition; confirmation order by 45 days and Plan Effective Date by 50 days after petition (subject to Bankruptcy Court approval).
• Effect on debt: Chapter 11 filing constitutes an event of default and accelerates prepetition obligations under the first‑lien credit agreement, PIK notes indenture, and convertible notes indenture, though enforcement is stayed by the bankruptcy.
• Company operations: Debtors remain debtors‑in‑possession and sought customary “first day” relief to continue operations; additional case information available at https://restructuring.ra.kroll.com/Inotiv.

Why It Matters
For holders of Inotiv common shares, the filing and Restructuring Support Agreement mean existing equity is expected to be cancelled with no recovery under the proposed Plan, so equity holders could lose their entire investment if the Plan is approved as proposed. Creditors will get new loans and equity allocations per the Plan, and the company’s near‑term liquidity will depend on securing and accessing the DIP Facility and the negotiated exit financing. All transactions are subject to Bankruptcy Court approval and the stated milestones, so outcomes and timing remain conditional on the Chapter 11 process.