Company: NOTV
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001628280-25-039017
Chunk: 54

Company: Inotiv, Inc.
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 1
Chunk 54
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 not change production capacity and would provide annual cost savings of approximately $4,000 to $5,000 from reduced repair and maintenance expense on facilities and lower cost of production, along with improved service for clients.

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We have continued to refine our plans for Phase Two and now anticipate that Phase Two will require a capital investment of approximately $6,500, which will include the use of tenant improvement dollars and a portion of the settlement payment received during March 2025. We also now expect that Phase Two will reduce production capacity and create operating efficiencies, while supporting our animal welfare objectives, and provide net annual savings of $6,000 to $7,000. Additionally, we believe Phase Two will allow us to remain agile and to increase capacity in the future, if needed. We are in the process of executing Phase Two, which we now plan to complete by March 2026, approximately six months earlier than we originally planned. Further, we anticipate beginning to see savings benefits as early as the fourth quarter of fiscal 2025.

In connection with Phase Two, the sale of one U.S. property was completed in June 2025 and the net proceeds were used to repay principal on our term loans, as required by the Credit Agreement (as defined below). Additionally, one U.S. property continued to meet the held for sale criteria as of June 30, 2025. The net proceeds from the sale of the U.S. property that is held for sale will also be used to repay principal on our term loans. 

Refer to Note 8 – Restructuring and Assets Held for Sale in our condensed consolidated financial statements contained in Part I, Item 1 for more information related to the site optimizations.

Securities Class Action and Derivative Lawsuits

Although no agreements have been reached, based on current negotiations with the plaintiffs, the Company has recorded a $10,000 liability for the Securities Class Action, Federal Derivative and State Derivative lawsuits (as defined in Note 12 - Contingencies and Commitments) as of June 30, 2025 and a $10,000 receivable, as the Company currently expects to recover the full amount of the accrual under its existing insurance policies. Refer to Note 5 - Supplemental Balance Sheet for further information on balance sheet presentation of the liability and the receivable. Although these amounts have been recorded to date, there can be no assurance that final agreements will be reached, on these or other terms. Final amounts payable or recoverable related to these lawsuits