UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): January 6, 2005
DOV Pharmaceutical, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware 000-49730 22-3374365
(State or Other Jurisdiction of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
433 Hackensack Avenue, Hackensack, NJ 07601
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (201) 968-0980
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:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| 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.
See Item 2.03, which is incorporated herein by reference.
ITEM 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
On January 4, 2005, DOV Pharmaceutical, Inc. (the "Company") announced that the
Initial Purchasers (as defined below) exercised their option in full to purchase
an additional $15 million aggregate principal amount of the Company's 2.50%
convertible subordinated debentures due 2025 (the "Debentures"). The Company's
press release issued pursuant to Rule 135c under the Securities Act of 1933, as
amended (the "Securities Act"), is attached hereto and incorporated herein by
reference.
On December 22, 2004, the Company entered into an Indenture (the "Indenture"),
between the Company, as Issuer, and Wells Fargo Bank, National Association, as
Trustee. A copy of the Indenture was filed as Exhibit 4.1 to the Company's
Current Report on Form 8-K filed with the Securities and Exchange Commission on
December 23, 2004. In connection with the Indenture, the Company issued and sold
$65 million aggregate principal amount of the Debentures on December 22, 2004
pursuant to the purchase agreement (the "Purchase Agreement") entered into
between the Company and the initial purchasers (the "Initial Purchasers"). In
connection with the exercise of the Initial Purchasers' option, the Company
issued and sold an additional $15 million aggregate principal amount of the
Debentures pursuant to the Purchase Agreement on January 6, 2005. The Initial
Purchasers received a discount of 3% of the par value of the Debentures.
The Debentures were offered and sold to the Initial Purchasers in reliance on
the exemption from registration provided by Section 4(2) of the Securities Act.
The Initial Purchasers of the Debentures then offered and sold the Debentures
only to qualified institutional buyers, as defined in Rule 144A under the
Securities Act. The Debentures and the common stock issuable upon conversion of
the Debentures have not been registered under the Securities Act or any state
securities laws, and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration requirements of
the Securities Act and applicable state securities laws.
The Debentures were issued at a price of 100% of the principal amount of the
Debentures, or $1,000 per Debenture, plus accrued interest from December 22,
2004. The Debentures will bear interest at a rate of 2.50% per year. The Company
will pay interest on the Debentures on January 15th and July 15th of each year,
beginning on July 15, 2005. The Debentures will mature on January 15, 2025. The
Debentures are unsecured and subordinated in right of payment to all of the
Company's existing and future senior indebtedness and are effectively
subordinated to all debt and other liabilities of the Company's subsidiaries.
The Debentures are convertible at any time prior to the close of business on the
business day immediately preceding the maturity date or, if the Debentures are
called for redemption, on the business day prior to the redemption date. The
initial conversion rate is 43.9560 shares of the Company's common stock per
$1,000 principal amount of Debentures (subject to adjustment in certain events).
This is equivalent to a conversion price of $22.75 per share of common stock. In
addition, if certain corporate transactions that constitute a change of control
occur on or prior to January 15, 2012, the Company will increase the conversion
rate in certain circumstances. Such increase in conversion rate will not be
required if the transaction constitutes a public acquirer change of control and
the Company elects to modify the conversion into public acquirer common stock.
In addition, if certain transactions that constitute a change of control occur
on or prior to January 15, 2012, under certain circumstances, the Company will
increase the conversion rate by a number of additional shares for any conversion
of Debentures in connection with such transactions.
The Indenture does not contain any financial covenants or any restrictions on
the payment of dividends, the making of investments, the incurrence of senior
debt or other indebtedness, the granting of liens or mortgages, or the issuance
or repurchase of securities by the Company. The Indenture does not contain any
covenants or other provisions to protect holders of the Debentures in the event
of a highly leveraged transaction or a fundamental change, except to the extent
described in the immediately preceding paragraph.
The Company may redeem for cash the Debentures in whole or in part at any time
beginning on January 15, 2008 and prior to January 15, 2012, at a redemption
price equal to 100% of the principal amount of the Debentures to be redeemed,
plus accrued and unpaid interest, including liquidated damages, if any, to but
excluding the redemption date, if the last reported sale price of the Company's
common stock has exceeded 140% of the conversion price for at least 20 trading
days in any consecutive 30-day trading period ending on the trading day prior to
the date of mailing of the notice of redemption. On or after January 20, 2012,
the Company may redeem for cash some or all of the Debentures at any time at a
redemption price equal to 100% of the principal amount of the Debentures to be
redeemed, plus any accrued and unpaid interest, including liquidated damages, if
any, to but excluding the redemption date.
Holders of the Debentures may require the Company to repurchase some or all of
their Debentures on January 15, 2012, January 15, 2015 and January 15, 2020, or
upon the occurrence of a fundamental change, at 100% of the principal amount of
the Debentures to be repurchased, plus any accrued and unpaid interest,
including liquidated damages, if any, to but excluding the repurchase date.
Each of the following will constitute an event of default under the Indenture:
o the Company's failure to pay when due the principal on any of the
Debentures at maturity, upon redemption or exercise of a repurchase right
or otherwise;
o the Company's failure to pay an installment of interest (including
liquidated damages, if any) on any of the Debentures for 30 days after the
date when due;
o the Company's failure to deliver shares of its common stock, together with
cash in lieu thereof in respect of any fractional shares, upon conversion
of a Debenture, and that failure continues for 10 days;
o the Company's failure to perform or observe any other term, covenant or
agreement contained in the Debentures or the Indenture for a period of 60
consecutive days after written notice of such failure, requiring the
Company to remedy the same, shall have been given to the Company by the
trustee or to the Company and the trustee by the holders of at least 25%
in aggregate principal amount of the Debentures then outstanding;
o the Company's failure to make any payment by the end of the applicable
grace period, if any, after the maturity of any indebtedness for borrowed
money in an amount in excess of $10.0 million, or if there is an
acceleration of indebtedness for borrowed money in an amount in excess of
$10.0 million because of a default with respect to such indebtedness
without such indebtedness having been discharged or such acceleration
having been withdrawn, cured, waived, rescinded or otherwise annulled, in
either case, for a period of 30 days after written notice to the Company
by the trustee or to the Company and the trustee by holders of at least
25% in aggregate principal amount of the Debentures then outstanding;
o the Company's failure to give timely notice of a fundamental change; and
o certain events of the Company's bankruptcy, insolvency or reorganization
or any significant subsidiary of the Company.
If an event of default specified in the last bullet point above occurs and is
continuing, then the principal of all the Debentures and the interest thereon
shall automatically become immediately due and payable. If an event of default
shall occur and be continuing, other than an event of default specified in the
last bullet point above, the trustee or the holders of at least 25% in aggregate
principal amount of the Debentures then outstanding may declare the Debentures
due and payable at their principal amount together with accrued interest.
In connection with the initial sale of the Debentures, the Company entered into
a Registration Rights Agreement, dated as of December 22, 2004 (the
"Registration Rights Agreement"), with the Initial Purchasers, under which the
Company has agreed to file a shelf registration statement with the Securities
and Exchange Commission covering resales of the Debentures and the common stock
issuable upon conversion of the Debentures within 100 days after the first date
of original issuance of the Debentures, and thereafter to use its reasonable
best efforts to cause such shelf registration statement to become effective
under the Securities Act within 240 days after the first date of original
issuance of the Debentures. If the Company does not comply with its registration
obligations it will be required to pay liquidated damages to the holders of the
Debentures. The Registration Rights Agreement was attached as Exhibit 4.3 to the
Company's Current Report on Form 8-K filed with the Securities and Exchange
Commission on December 23, 2004.
ITEM 3.02. UNREGISTERED SALES OF EQUITY SECURITIES.
See Item 2.03, which is incorporated herein by reference.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. The following exhibits are filed with this Current Report on Form
8-K.
Exhibit No. Title
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99.1 Press Release, dated January 4, 2005, of DOV
Pharmaceutical, Inc.
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 thereunto duly authorized.
DOV Pharmaceutical, Inc.
Date: January 6, 2005 By: /s/ Arnold Lippa
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Arnold Lippa
Chief Executive Officer
EXHIBIT INDEX
Exhibit No. Title
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99.1 Press Release, dated January 4, 2005, of DOV
Pharmaceutical, Inc.