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| APRI > SEC Filings for APRI > Form 8-K on 3-Jan-2013 | All Recent SEC Filings |
3-Jan-2013
Entry into a Material Definitive Agreement, Costs Associated with Exit
Entry into Agreement for Sale of Property
On December 28, 2012, NexMed (U.S.A.), Inc., a wholly-owned subsidiary of Apricus Biosciences, Inc. (the "Company"), entered into a Real Estate Purchase Agreement (the "Purchase Agreement") whereby the Company agreed to sell the Company's real property located at 89 Twin Rivers Drive and 113 Milford Road, East Windsor, NJ (the "Property") for a total of $4.125 million (the "Transaction").
Pursuant to the Purchase Agreement, the purchaser has a 30-day due diligence period to inspect the Property. During the due diligence period, the purchaser may terminate the Purchase Agreement for any reason. Additionally, the purchaser may terminate the Purchase Agreement if it is unable to obtain financing within 45 days. The Transaction is expected to close on or about February 26, 2013, subject to the satisfaction of the foregoing conditions, as well as other customary closing conditions. The Company may incur additional charges of approximately $0.4 million based on the current sales price and taking into account costs to sell the building.
A copy of the Purchase Agreement will be filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.
Entry into Separation Agreement
On December 28, 2012, the Company entered into a Separation Agreement and Mutual Release (the "Separation Agreement") with Bassam Damaj, Ph.D. ("Damaj"). Damaj served as the Company's President and Chief Executive Officer until November 6, 2012, at which time he tendered his resignation as an officer and director of the Company. Pursuant to the Separation Agreement, the Company has agreed to pay Damaj: (a) the sum of $463,950, which will be payable over a period of 8 months in equal monthly installments, and (b) $73,882 in lieu of Damaj's pro rated bonus for fiscal 2012, which amount was paid on December 28, 2012. Additionally, the vesting of Damaj's outstanding equity awards will be accelerated, which results in: (x) the issuance to him of 46,667 shares of common stock underlying restricted stock units, and (y) the accelerated vesting of options to purchase up to a total of 300,000 shares of common stock at exercise prices ranging from $3.23 to $3.89 per share (the "Options"). The Options will expire if not exercised prior to February 4, 2013.
In addition to the foregoing payments, the Separation Agreement contains a
mutual release of claims, with Damaj releasing the Company and its affiliates
from any claims relating to his service and termination thereof, and the Company
releasing Damaj from any claims that the Company may have against him (other
than claims relating to actions that would constitute criminal conduct or
violation of securities laws, rules or regulations). Damaj has further agreed to
a standstill for a period of 18 months, during which time he will refrain from:
acquiring shares of the Company's common stock (other than on exercise of
compensatory option awards), participating in any solicitation of proxies,
making any public announcements regarding proposed business transactions with
the Company, forming or joining a "group" to engage in any of the foregoing
activities, or taking certain other related actions with regard to the Company.
Any disputes arising under the Separation Agreement will be resolved by binding arbitration. In the event that the Company is found to have materially breached the Separation Agreement, Damaj will be entitled to receive any withheld payments (with interest) and accelerated payment of any remaining amounts due. In the event that Damaj is found to have materially breached the Separation Agreement, the Company will be entitled to recover: (a) all payments made after such breach (and shall not be required to make any further payments under the Separation Agreement), as well as (b) up to $200,000 in liquidated damages, which shall be recovered as reimbursement of certain payments made prior to the breach. The prevailing party in any dispute shall also be entitled to recovery of its fees and expenses (including reasonable attorneys' fees), as well as any economic damages that the arbitrator may award.
The foregoing summary of the Separation Agreement is qualified with reference to the full text of the Separation Agreement, which is incorporated herein by reference. A copy of the Separation Agreement will be filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.
The disclosure set forth below under the caption "Item 8.01 Other Events" is incorporated herein by reference.
On January 3, 2013, the Company announced that it is streamlining its corporate strategy to focus on its assets with potential for the greatest return, such as Vitaros® for erectile dysfunction and Femprox® for female sexual arousal disorder, and plans to seek a buyer for its oncology supportive care business. Apricus Pharmaceuticals (U.S.A.), Inc. ("Apricus Pharma"), which is currently a
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