LAS VEGAS, Feb. 25, 2021 /PRNewswire/ -- JanOne Inc.
(Nasdaq: JAN), a company focused on developing treatments for
conditions that cause severe pain and drugs with non-addictive,
pain-relieving properties, today announced that is has entered into
a definitive agreement to sell its legacy recycling subsidiary,
ARCA Recycling, to Virland Johnson,
JanOne's Chief Financial Officer, for an aggregate purchase price
of approximately $25 million. The
agreement follows JanOne's previously announced intent to divest
its legacy businesses, allowing for a strategic corporate focus on
the Company's core life science assets.
Under terms of the definitive agreement, Mr. Johnson will
acquire substantially all of the assets, and assume certain
liabilities, of ARCA Recycling, Inc. and Customer Connexx LLC.
The purchase price of $25 million is subject to certain
adjustments, including a potential increase in the purchase
price due to an earnout, the assumption of certain
debt of ARCA Recycling, Connexx, and JanOne, and
potential indemnification claims (collectively, the
"Initial Aggregate Consideration"). The transaction is
expected to close on or before August 18,
2021, subject to customary closing conditions. At closing,
$7.5 million of the Initial Aggregate
Consideration will be paid in immediately available funds, and
$17.5 million of
the Initial Aggregate Consideration will be paid pursuant
to the terms of the buyers' subordinated promissory
note in JanOne's favor, which will bear interest at the
rate of 6% per annum on the unpaid balance thereof.
The members of JanOne's Board of Directors voted unanimously in
favor of the transaction, which was approved at a special meeting
of the Board not attended by Mr. Johnson.
"Today's announcement furthers our strategic plan to streamline
our organization and focus on the continuing advancement of our
proprietary, high-value, late-stage biopharma asset, JAN101, for
the treatment of peripheral artery disease, or 'PAD,'" said
Tony Isaac, President and Chief
Executive Officer of JanOne. "Proceeds from the sale will support
our entry into a pivotal Phase 2b
trial for PAD this year. At the same time, we intend to continue
pursuing additional potential indications for JAN101, including
non-addictive pain management and the treatment of vascular
complications associated with COVID-19. Each of these catalysts is
key to maximizing value for our stockholders as a flourishing
biopharma company."
JanOne recently completed production of JAN101 under Current
Good Manufacturing Practices (cGMP) for the anticipated Phase
2b PAD trials. The completion of the
cGMP batch demonstrates the Company's ability to economically scale
up production of JAN101, and sets the stage for exploring JAN101 as
a treatment for both PAD and vascular complications caused by
COVID-19. The Company plans to submit the Phase 2b protocol and related documents to the FDA
under its Investigational New Drug Application (IND) for PAD
in March 2021.
Additional information about JanOne's definitive sale agreement
is available in the Company's Current Report on Form 8-K to be
filed later today with the Securities and Exchange Commission.
About JanOne
JanOne (NASDAQ: JAN) is focused on developing treatments for
diseases that cause severe pain. By alleviating pain at the source,
JanOne aims to reduce the need for opioid prescriptions to treat
disease associated pain that can lead to opioid abuse. The company
is also exploring solutions for non-addictive pain medications. Its
lead candidate JAN101 is for treating peripheral artery disease
("PAD"), a condition that affects over 8.5 million Americans.
JAN101 demonstrated positive results in a Phase 2a clinical trial,
and Phase 2b trials are expected to begin in early 2021.
JanOne is dedicated to funding resources toward innovation,
technology, and education for PAD, associated vascular conditions
and neuropathic pain. For more information,
visit www.janone.com.
Forward-Looking and Cautionary Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. In accordance with the safe harbor provisions of this Act,
statements contained herein that look forward in time that include
everything other than historical information, including statements
relating to the closing of the sale of the recycling business.
These forward-looking statements can be identified by terminology
such as "will," "aims," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements.
JanOne may also make written or oral forward-looking statements in
its periodic reports to the U.S. Securities and Exchange Commission
(the "SEC") on Forms 10-K and 10-Q, Current Reports on Form 8-K, in
its annual report to stockholders, in press releases, and other
written materials and in oral statements made by its officers,
directors or employees to third parties. There can be no assurance
that such statements will prove to be accurate and there are a
number of important factors that could cause actual results to
differ materially from those expressed in any forward-looking
statements made by the company, including, but not limited to,
plans and objectives of management for future operations or
products, the market acceptance or future success of our products,
and our future financial performance. The company cautions that
these forward-looking statements are further qualified by other
factors including, but not limited to, those set forth in the
company's Annual Report on Form 10-K for the fiscal year
ended December 28, 2019 and other SEC filings (available
at http://www.sec.gov). JanOne undertakes no obligation to
publicly update or revise any statements in this release, whether
as a result of new information, future events, or otherwise.
Investor Relations & Media Contact
IR@Janone.com
1 (800) 400-2247
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SOURCE JanOne