UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------
FORM 8-K
CURRENT REPORT
Pursuant To Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 29, 2007
BRADLEY PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-31680 22-2581418
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
383 Route 46 West, Fairfield, New Jersey 07004
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (973) 882-1505
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|X| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry Into a Material Definitive Agreement
On October 29, 2007, Bradley Pharmaceuticals, Inc. (the "Company") entered into
a definitive merger agreement (the "Merger Agreement") with Nycomed US Inc.
("Nycomed US") and Phase Merger Sub Inc., a wholly owned subsidiary of Nycomed
US ("Merger Sub"). Nycomed US is an indirect subsidiary of Nycomed S.C.A.,
SICAR. The Merger Agreement provides that, upon the terms and subject to the
conditions set forth in the Merger Agreement, Merger Sub will merge with and
into the Company (the "Merger"), with the Company continuing as the surviving
corporation. Upon consummation of the Merger, the Company will become a wholly
owned subsidiary of Nycomed US.
At the effective time of the Merger, all shares of the Company's common stock,
par value $.01 per share, and Class B common stock, par value $.01 per share,
then outstanding (other than shares as to which dissenters' rights have been
properly exercised) will be converted into $20.00 per share in cash.
The Company and Nycomed US have made customary representations, warranties and
covenants in the Merger Agreement, including, among others: (i) covenants
generally requiring the Company to conduct its business prior to the closing of
the Merger in the ordinary course consistent with past practice; (ii) subject to
the Company's Board of Directors' right to exercise its fiduciary duties,
covenants restricting the solicitation of competing acquisition proposals, and
(iii) covenants relating to obtaining the required approval of the Company's
stockholders. The transaction is conditioned on receipt of approval by holders
of a majority of the outstanding shares of the Company's common stock and Class
B common stock, voting together as one class. The transaction is also subject to
the expiration or termination of applicable waiting periods under United States
and foreign anti-trust laws and other customary closing conditions. There is no
financing condition, and the obligations of Nycomed US are guaranteed by Nycomed
S.C.A., SICAR. The transaction is expected to be completed in the first quarter
of 2008.
Under the Merger Agreement, each of the Company and Nycomed has certain rights
to terminate the Merger Agreement and the Merger. Upon the termination of the
Merger Agreement under certain specified circumstances, the Company must pay
Nycomed a termination fee equal to 3% of the aggregate Merger Consideration (as
defined in the Merger Agreement).
The Company's Board of Directors approved the Merger Agreement and recommended
that Bradley's stockholders vote in favor of the Merger Agreement. Mr. Daniel
Glassman, a director as well as the founder, President and Chief Executive
Officer of the Company and the holder of substantially all of its Class B common
stock, did not participate in the Board's consideration and approval of the
Merger Agreement.
The description contained in this Item 1.01 of certain terms of the Merger
Agreement and the Guaranty of Nycomed S.C.A., SICAR and the transactions
contemplated by the Merger Agreement and such Guaranty is qualified in its
entirety by reference to the full text of the Merger Agreement, a copy of which
is attached hereto as Exhibit 2.1, and the Guaranty, a copy of which is attached
hereto as Exhibit 2.2. The Merger Agreement has been included to provide
investors and security holders with information regarding its terms and
conditions. It is not
intended to provide any other factual information about the Company. The Merger
Agreement contains representations and warranties that the parties to the Merger
Agreement made to and solely for the benefit of each other. The assertions
embodied in the Company's representations and warranties are also qualified by
information contained in its confidential disclosure schedule delivered in
connection with signing the Merger Agreement. Accordingly, investors and
security holders should not rely on such representations and warranties as
characterizations of the actual state of facts or circumstances, since they were
only made as of the date of the Merger Agreement and are modified in important
part by the underlying disclosure schedules. Moreover, information concerning
the subject matter of such representations and warranties may change after the
date of the Merger Agreement, which subsequent information may or may not be
fully reflected in the Company's public disclosures.
Additional Information About the Proposed Transaction and Where You Can Find It
In connection with the proposed Merger, the Company intends to file a proxy
statement and other relevant materials with the Securities and Exchange
Commission ("SEC"). BEFORE MAKING ANY VOTING DECISION WITH RESPECT TO THE
PROPOSED TRANSACTION, STOCKHOLDERS OF BRADLEY PHARMACEUTICALS ARE URGED TO READ
THE PROXY STATEMENT, WHEN IT BECOMES AVAILABLE, AND THE OTHER RELEVANT MATERIALS
FILED BY THE COMPANY WITH THE SEC BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. The proxy statement and other
relevant materials, when available, and any other documents filed by the Company
with the SEC, may be obtained free of charge at the SEC's website at
www.sec.gov. In addition, Company stockholders may obtain free copies of the
documents filed with the SEC on the Company's website (www.bradpharm.com) or by
contacting the Company at Bradley Pharmaceuticals, Inc., Investor Relations at
383 Route 46 West, Fairfield, NJ 07004, Telephone: (973) 882-1505, ext 252. You
may also read and copy any reports, statements and other information filed by
the Company with the SEC at the SEC public reference room at 100 F Street, N.E.
Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 or
visit the SEC's website for further information on its public reference room.
The Company and its directors, executive officers and other members of its
management may be deemed to be soliciting proxies from the Company's
stockholders in favor of the Merger. Investors and stockholders may obtain more
detailed information regarding the direct and indirect interests in the merger
of persons who may, under the rules of the SEC, be considered participants in
the solicitation of the Company's stockholders in connection with the Merger by
reading the preliminary and definitive proxy statements regarding the Merger,
which will be filed with the SEC. Information about the Company's directors and
executive officers may be found in the Company's definitive proxy statement
filed with the SEC on May 17, 2007. These documents will be available free of
charge once available at the SEC's web site at www.sec.gov or by directing a
request to the Company as provided above.
On October 30, 2007, the Company issued a press release announcing the merger
transaction described in Item 1.01 above. A copy of the press release is
attached as Exhibit 99.1 hereto and is incorporated herein by reference.
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Item 5.01 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On October 29, 2007, the Board of Directors, upon the recommendation of its
Compensation Committee, offered an employment agreement to Ralph Landau, PhD,
the Company's Vice President and Chief Scientific Officer. The Company and Dr.
Landau executed the employment agreement (the "Employment Agreement") as of
October 30, 2007. The Employment Agreement is substantially identical to the
employment agreements executed by the other executive officers of the Company in
December 2005. The Employment Agreement did not make any changes in Dr. Landau's
compensation arrangements. The primary effects of the Employment Agreement are
to provide a term of employment that ends on December 6, 2008, the same time as
that in the Company's employment agreements with the other executive officers,
and to provide certain benefits upon termination of employment. The "change of
control" provisions in the Employment Agreement are identical to those in Dr.
Landau's existing Change of Control Agreement previously filed with the SEC,
which agreement has been terminated upon execution of the Employment Agreement.
A copy of the Employment Agreement is filed herewith as Exhibit 10.1 and a
summary description of the material terms of the Employment Agreement is set
forth below, which summary is qualified in its entirety by reference to the
attached Employment Agreement.
Under the Employment Agreement, Dr. Landau will serve in his position until
December 6, 2008 (the "Expiration Date"), unless sooner terminated by the
Company or him. The Employment Agreement renews automatically for an additional
one year on the Expiration Date and each anniversary of the Expiration Date
unless the Company or Dr. Landau gives written notice to the other to the
contrary at least 90 days prior to the end of the term or renewal term, as the
case may be. Dr. Landau will receive an annual base salary of $280,500. From
time to time during the term of the Employment Agreement, Dr. Landau will be
entitled to receive such options to purchase shares of the Company's common
stock and other similar securities of the Company on such terms and conditions
as the board and Compensation Committee of the board may establish.
Additionally, Dr. Landau is eligible to participate in all of the Company's
bonus and benefit plans, including without limitation the Company's EVA Bonus
Plan, in which senior executives of the Company are generally entitled to
participate.
Upon a termination of employment without "cause" or for "good reason" (as
defined in the Employment Agreement), Dr. Landau will be entitled to: (i) a lump
sum cash payment equal to the sum of (a) any accrued but unpaid salary as of the
date of such termination, (b) any accrued but unpaid annual cash bonus payable
under the Company's EVA Bonus Plan for any annual period ended prior to the date
of such termination, and (c) all expenses incurred for which documentation has
been or will be provided in accordance with the Company's policies but not yet
reimbursed; (ii) a lump sum cash payment equal to the amount payable under the
Company's EVA Bonus Plan for the annual period in which such termination occurs,
prorated through the date of such termination; (iii) continuation of all
perquisites and other Company-related benefits to which he was entitled as of
the date of his termination through the end of the second calendar year
following the year in which his employment terminates; (iv) immediate vesting of
all of his
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stock options or any other equity awards based on the Company's securities; (v)
continued participation in, and continuation by the Company of the payment of
the relevant premiums applicable to, the life insurance and health, welfare and
medical insurance plans of the Company through the end of the second calendar
year following the year in which his employment terminates; and (vi) continued
participation by him and his dependents in all other Company-sponsored health,
welfare and benefit plans through the end of the second calendar year following
the year in which his employment terminates. In addition to the foregoing
payments and benefits continuation, upon termination without "cause" or for
"good reason", Dr. Landau will be entitled to a lump sum cash payment equal to
two times the sum of his then current annual salary and the average amount paid
to him under the Company's EVA Bonus Plan with respect to the most recent three
calendar years.
If a "change of control" of the Company (as defined in the Employment Agreement)
occurs during the term of the Employment Agreement, and if, during such term and
within twelve months after the date on which the "change of control" occurs, his
employment is terminated by the Company without "cause" or by him for any
reason, then Dr. Landau will be entitled to the payments and benefits described
in the preceding paragraph for a termination without "cause" or for "good
reason."
In the event that any payment under the Employment Agreement is subject to the
excise tax for golden parachute payments, the Company will provide Dr. Landau
with a gross-up payment as may be necessary to put him in the same after-tax
position as if the payments had not been subject to the excise tax.
Dr. Landau has agreed that he will not compete with the Company for a period of
12 months immediately following the term of the Employment Agreement; provided,
however, that such restriction will not apply if his employment is terminated
without "cause" or he terminates his employment for "good reason," regardless of
whether a "change of control" has occurred.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
Number Description
2.1 *Agreement and Plan of Merger, dated as of October 29, 2007 by
and among the Company, Nycomed US Inc. and Phase Merger Sub
Inc.
2.2 Guaranty, dated as of October 29, 2007 from Nycomed S.C.A.,
SICAR in favor of the Company
10.1 Employment Agreement, dated as of October 30, 2007 between the
Company and Ralph Landau
99.1 Press Release dated October 30, 2007
*Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of
Regulation S-K. Bradley Pharmaceuticals, Inc. hereby undertakes to furnish
supplementally copies of any of the omitted schedules and exhibits upon request
by the SEC.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BRADLEY PHARMACEUTICALS, INC.
By: /s/ R. Brent Lenczycki
---------------------------
R. Brent Lenczycki, CPA
Chief Financial Officer and
Vice President
Dated: October 30, 2007
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