Jun 2 2010
Synergetics USA, Inc. (NASDAQ: SURG) ("Synergetics" or the "Company") today announced its preliminary results for the third fiscal quarter ended April 30, 2010 related to the allocation of proceeds from the settlement, license and supply agreement with Alcon Laboratories, Inc. and the expected gain from the sale of the Omni® product line to Stryker Corporation. The Company stated during an investor conference call on April 28, 2010 that it would pre-announce the impact of these transactions as soon as the results were available:
- The Company announced on April 27, 2010 that it had entered into a Settlement and License Agreement with Alcon Laboratories, Inc. pursuant to which Alcon paid to Synergetics $32 million. The net proceeds to Synergetics are $21.5 million after payments to contingency attorneys. The Company expects to recognize a gain from this agreement of approximately $2.4 million pre-tax or approximately $0.06 per diluted share in the third fiscal quarter. The remaining portion of the $21.5 million has been accounted for as an up-front fee under the License Agreement and will be deferred and recognized as earned over a period of up to fifteen years based upon the units shipped to Alcon.
- In addition, the Company expects the gain from the sale of the Omni® product line to Stryker (announced on April 1, 2010) to be approximately $800,000 pre-tax, or approximately $0.02 per diluted share in the third fiscal quarter of 2010.
- The Company plans to utilize proceeds from the sale of the Omni® product line and the Alcon agreements to pay-down debt, expand its production capabilities, accelerate development efforts and explore strategic opportunities. The Company anticipates having a significantly improved cash position after the payment of the related taxes and debt pay-downs.