Combined net sales of the Products during the twelve month period ending August 31, 2014 were approximately CDN$10.8 million.
Fiorinal and Fiorinal C are indicated for the relief of tension-type headache and Visken /Viskazide for the treatment of mild-moderate hypertension. Visken is also indicated for the prevention of angina pectoris.
The Company funded the acquisition of the Products with cash on hand and with US$6 million of debt provided by SWK Holdings Corporation ("SWK") (SWKH.OB).
"We are very pleased with this acquisition for a multitude of reasons," stated Rob Harris, President and CEO of Tribute.
"This acquisition becomes immediately accretive and the Company expects to report positive EBITDA beginning as early as Q4 2014 and expects to be EBITDA positive in 2015. Fiorinal and Fiorinal C are very complimentary with Tribute’s existing product Cambia . Cambia, indicated for acute migraine and Fiorinal and Fiorinal C for the relief of tension-type headache are very synergistic. The acquisition of Fiorinal and Fiorinal C strengthens Tribute’s promotional and marketing presence in the Canadian headache/migraine market and will immediately result in increased market share while Visken and Viskazide complement our cardiovascular presence with Bezalip SR."
Mr. Harris went on to say that "the addition of these Products is very strategic for Tribute and we can significantly increase promotion of both product lines within the capacity of our existing sales force. We are delighted to conclude this transaction with Novartis, a global leader in the pharmaceutical market and we look forward to transitioning these Products with Novartis into our existing business."
In connection with the transaction the Company increased its existing debt facility with SWK by up to US$9 million, US$6 million of which was drawn upon in connection with the acquisition of the Products. The additional advances by SWK will be governed by the terms of the credit agreement entered into between the Company and SWK in August 2013 with certain revisions thereto as set forth in the Form 8-K to be filed with U.S. and Canadian securities regulatory authorities. In connection with the funding of the first tranche SWK was issued an aggregate of 740,000 common share purchase warrants with each such warrant entitling the holder thereof to acquire, at any time before October 1, 2019, one common share of Tribute at a price of US$0.70 per share. The warrants and common shares issuable on exercise of the warrants will be subject to a hold period expiring on February 2, 2015, pursuant to Canadian securities laws.
The management of Tribute will host a conference call to further discuss the details of this transaction in conjunction with its upcoming third quarter financial results. Details of the call will be provided closer to the actual date of the call.