Lannett Company, Inc. -- Moody's Affirms Lannett's B2 CFR; Senior Secured Rating Downgraded to B2; Stable outlook

New York, June 15, 2016 -- Moody's Investors Service, ("Moody's") affirmed the B2 Corporate Family Rating of Lannett Company, Inc. (Lannett) and downgraded the rating on the senior secured revolver and Term Loans to B2 from B1. The actions follow the announcement that the company will repay its 12% unsecured notes with proceeds of additional secured debt, namely an increase in the Term Loan B of $150 million and Lannett's fully drawn $125 million revolver. The change in capital structure removes the benefit of first loss absorption provided by the unsecured notes to senior secured lenders. As a consequence of the now all first lien capital structure, Moody's downgraded the Probability of Default Rating to B3-PD from B2-PD.

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