As filed with the Securities and Exchange Commission on July 8, 1999.
Registration No. 333-75997
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BRADLEY PHARMACEUTICALS, INC.
(exact name of registrant as specified in its charter)
Delaware 2834 22-2581418
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Code Number) Identification No.)
incorporation
or organization)
383 Route 46 West
Fairfield, New Jersey 07004
(973) 882-1505
(Address, including zip code, and telephone number, including
area code, of registrant's principal offices)
DANIEL GLASSMAN
Chairman of the Board
Bradley Pharmaceuticals, Inc.
383 Route 46 West
Fairfield, New Jersey 07004
(973) 882-1505
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
W. RAYMOND FELTON, ESQ.
Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP
Metro Corporate Campus I
Post Office Box 5600
Woodbridge, New Jersey 07095
(732) 549-5600
Approximate date of commencement of proposed sale to
the public: As soon as practicable after this Registration
Statement becomes effective.
<PAGE>
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box. __
If any of the securities being registered on this Form are to be
offered on a delay or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, check the following box. x
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of each Class of to be Price per Offering Registration
Securities to be Registered Registered1 Share2 Price2 Fee
Class A Common Stock, 2,270,000 $1.1875 $2,695,625 $749.38
par value $.01 per share
</TABLE>
- --------------------------
1 Includes an indeterminate number of shares of common stock
issuable to prevent dilution resulting from stock splits, stock dividends or
similar transactions pursuant to Rule 416 under the Securities Act of 1933, as
amended.
2Estimated pursuant to Rule 457 based upon the closing price
of the common stock on April 5, 1999 as reported on The Nasdaq Stock Market(TM)
solely for the purpose of computing the registration fee.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
SUBJECT TO COMPLETION, DATED JULY 8, 1999
PROSPECTUS
2,270,000 SHARES
BRADLEY PHARMACEUTICALS, INC.
COMMON STOCK
Berlex Laboratories, Inc. and Stern, Stewart & Co., Inc. will sell their
shares from time to time with this prospectus. We will not receive any of the
proceeds from the sale of those shares. We will bear the expenses of this
offering except for brokerage commissions and selling expenses, which Berlex and
Stern Stewart will pay. See "Selling Shareholders" and "Plan of Distribution."
Our common stock is quoted on the Nasdaq Stock Market(TM) under the symbol
"BPRX." On July 7, 1999, the closing price for the common stock was $1.344 as
reported by Nasdaq. An investment in the shares is speculative and only those
purchasers who can afford to lose their entire investment should purchase
shares.
See " Risk Factors" beginning on page 5 for factors to be considered in
connection with purchasing shares.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
The date of this prospectus is July __, 1999.
<PAGE>
TABLE OF CONTENTS
Page
Prospectus Summary 3
Risk Factors 5
Recent Financing Transaction 12
Where You Can Find
More Information 13
Incorporation of Certain
Information by Reference 13
Use of Proceeds 14
Selling Shareholders 14
Plan of Distribution 15
Indemnification 16
Legal Matters 17
Experts 17
No dealer, salesperson or other person is authorized to give any
information or to make any representation not contained in this prospectus, and,
if given or made, you may not rely on such information or representation as
having been authorized by us. This prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any of the shares to any person in any
jurisdiction in which it is unlawful to make such an offer or solicitation to
such person. Neither the delivery of this prospectus nor any sale made hereunder
shall under any circumstances create any implication that the information
contained herein is correct as of any date subsequent to the date hereof.
<PAGE>
PROSPECTUS SUMMARY
The Company
The following summary contains basic information about Bradley
Pharmaceuticals, Inc. and its subsidiaries, and this offering. It may not
contain all the information that may be important to you. You should read this
entire prospectus, the documents incorporated by reference, including the
financial data and related notes, and the documents to which we have referred
you before making an investment decision. The references to "we," "us" and "our"
mean Bradley Pharmaceuticals, Inc. and its subsidiaries, except where it is
clear the context indicates otherwise.
We market over-the-counter and prescription pharmaceutical and
health-related products. Our product line currently includes dermatological
brands, marketed by our wholly-owned subsidiary, Doak Dermatologics, Inc., and
nutritional, respiratory, personal hygiene and internal medicine brands,
marketed by our Kenwood Therapeutics division. All of our product lines are
manufactured and supplied by independent contractors under our quality control
standards and marketed primarily to wholesalers. The wholesalers, in turn,
distribute our products to retail outlets and healthcare institutions throughout
the United States and to distributors in selected international markets.
Our growth strategy has been to make acquisitions of established
products from major pharmaceutical organizations that we believe require
intensified marketing and promotional attention. We believe that significant
growth opportunities exist in this market niche as a result of the divestiture
by major pharmaceutical companies of certain established product lines that have
become less profitable in relation to their other products. As a result, we have
acquired, and intend to continue to acquire, rights to manufacture and market
pharmaceutical and health related products which are effective and for which a
demonstrated market exists, but which are not actively promoted. We generally
acquire products where the surrounding competitive environment does not
necessarily include major pharmaceutical companies.
Our ability to make further product acquisitions will depend, among
other things, on the availability of appropriate acquisition opportunities, the
ability to obtain appropriate financing and our ability to consummate
acquisitions on favorable terms. There can be no assurance that we will be able
to consummate in a timely way attractive acquisitions on favorable terms.
Therefore, we have and will continue to focus on developing and extending our
existing product lines.
Our most significant acquisition to date was in December 1993, when we
purchased the Deconamine(R) cold/flu/allergy product line from Berlex, a
subsidiary of Schering AG. In satisfaction of all outstanding obligations then
owed to Berlex in 1997 (of approximately $2,500,000), and in consideration of
Berlex's release of its lien covering our accounts receivable, we:
<PAGE>
. paid to Berlex $1,150,000 in cash, plus accrued interest;
. issued to Berlex 450,000 shares of our Class A common stock in
addition to the 1,000,000 shares previously issued to Berlex;
and
. agreed to issue Berlex, when permissible in accordance with
applicable state corporate law, warrants entitling Berlex to
purchase, up to an additional 750,000 shares of Class A common
stock at an exercise price of $1.25 per share. These warrants
are subject to anti-dilution provisions and expire two years
after issuance, subject to possible extension.
We were incorporated in New Jersey in January 1985 and subsequently
reincorporated in Delaware in July 1998. Our principal executive offices are
located at 383 Route 46 West, Fairfield, New Jersey 07004, telephone number
(973) 882-1505.
<PAGE>
RISK FACTORS
Before you invest in the shares you should be aware that the value of
the shares in the secondary market is subject to various risks, including those
described below. You should consider carefully these risk factors together with
all of the other information included in this prospectus before you decide to
purchase the shares.
Failure to maintain Deconamine(R) as a significant portion of revenue could
adversely affect our profitability.
For the fiscal years ended December 31, 1997 and 1998, sales of our
Deconamine(R) product line accounted for approximately 45% and 37%,
respectively, of our net sales. Thus, we are dependent on our ability to market
and sell the Deconamine(R) product line. The concentration of our net sales in a
single product line makes us particularly dependent on that line. If demand for
the Deconamine(R) product line decreases and we fail to replace those sales, our
revenues and profitability would decrease.
If our Deconamine(R) line is converted to over-the-counter status, we may
not have the resources to compete.
All over-the-counter cough and cold products are regulated by the
United States Food and Drug Administration pursuant to monographs which specify
permissible active ingredients, labeling and indications. FDA regulations also
establish when specific drug products, such as the Deconamine(R) line of
products, change from prescription to non-prescription or over-the-counter
status. Our Deconamine(R) product line, which currently has prescription status,
falls under these monographs. Once a final monograph is issued by the FDA with
respect to a product, the product historically can remain as a prescription
product for up to one additional year. We anticipate that final monographs for
our Deconamine(R) product line, thereby converting the product line to
over-the-counter status, will be issued by the FDA at some time in the future.
We intend to continue to market and distribute our Deconamine(R) line of
products as prescription products for as long as we may lawfully continue to do
so. We are exploring our marketing and distribution strategy relating to the
Deconamine(R) product line after final monographs covering these products are
issued. We cannot currently predict how our operations and financial condition
will be affected, or whether we will have resources sufficient to aggressively
market the Deconamine(R) line of products, if and when this product line is
converted to over-the-counter status.
We may not be able to afford the FDA filing necessary for the continued
marketing of Deconamine(R).
We must file an Abbreviated New Drug Application with the FDA for our
Deconamine(R) SR product to comply with the regulation that all controlled
release
<PAGE>
products, like Deconamine(R) SR, be the subject of an ANDA. The cost of
this ANDA is approximately $900,000. We entered into an agreement with Phoenix
International to perform the clinical studies required for the issuance of the
ANDA. As of the date of this prospectus, we have paid approximately $350,000
with respect to this project. This project is being deferred until regulatory
and competitive circumstances warrant completion and submission to the FDA.
Completion of this research and development project is subject, however, to our
either generating sufficient cash flow from operations to fund the same or
obtaining requisite financing from outside sources, of which there can be no
assurance. Therefore, we cannot at this time reasonably anticipate the timing of
the expenditure of funds for these purposes. If we are unable to further develop
or file the necessary ANDA for Deconamine(R) SR , we would not be able to market
that product.
Since we rely on independent manufacturers for our products, any regulatory or
production problems could adversely affect our product supply.
We do not own or operate any manufacturing or production facilities.
Rather, all of our products are manufactured and supplied by independent
companies, many of which also manufacture and supply products for some of our
competitors. We do not generally have any licensing or other supply agreements
with manufacturers or suppliers for our products and are currently dependent
upon a limited number of potential suppliers. Any of these suppliers could
terminate their relationship with us at any time. From time to time we have
experienced delays in shipments from some of our vendors. Although we believe we
can obtain replacement manufacturing arrangements, the absence of such
agreements with our present suppliers may, in certain instances, have an adverse
effect upon our sales and marketing efforts. To date, we have not encountered
any problems, or experienced delays, in locating alternative manufacturers and
suppliers. Further, all of our pharmaceutical suppliers must be authorized under
FDA regulations or specific approvals and must manufacture our products in
authorized facilities pursuant to federally regulated current good manufacturing
practices. In the event we were to experience problems complying with CGMPs or
difficulties with our present manufacturers or suppliers, we would experience
delays in obtaining products which would reduce our sales and profitability.
Failure to comply to FDA and foreign regulations could restrict our ability to
conduct our business.
Like all pharmaceutical companies, we are subject to extensive federal
and state regulations. We cannot predict the extent to which we may be affected
in the future by legislative and other regulatory developments concerning our
products. In the United States, drug products we sell are subject to regulation
by the FDA, as well as by other federal and state agencies. The FDA regulates
all aspects of the testing, manufacture, safety, labeling, storage, record
keeping, advertising and promotion of all drugs, including the monitoring of
compliance with CGMP's. Non-compliance with applicable requirements can result
in fines and other sanctions, including the initiation of product seizures,
injunction actions and criminal
<PAGE>
prosecutions based on practices that violate
statutory requirements. In addition, administrative remedies can involve
voluntary recall of products, as well as the withdrawal of approval of products
in accordance with due process procedures. There are similar regulations in most
foreign countries in which our products are distributed or sold. Any restriction
or prohibition of our sales of products could reduce our sales and
profitability.
Price controls set by the U.S. and foreign governments could adversely
affect our profit margins.
U.S. Federal and state governments continue to seek means to reduce
costs of Medicare and Medicaid programs, including placement of restrictions on
reimbursement for, or access to, certain drug products. Major changes were made
in the Medicaid program under the Omnibus Budget Reconciliation Act of 1990. As
a result, we entered into a Medicaid Rebate Agreement with the U.S. Government.
Pursuant to the Rebate Agreement, in order for federal reimbursement to be
available for prescription drugs under state Medicaid plans, we must pay certain
statutorily prescribed rebates on Medicaid purchases. In most other developed
markets in which our products are marketed and sold, governments exert controls
over pharmaceutical prices either directly or indirectly or by controlling
admission to, or levels for, reimbursement by government health programs. The
nature of such controls and their effect on the pharmaceutical industry varies
greatly from country to country. The statutes and regulations that govern our
business and activities are subject to change, and current political and public
interest in pharmaceutical products may lead to changes in federal and state law
may affect us and the way we do business. We cannot anticipate what effect, if
any, such legislation may have on our operations.
Since we rely on a few wholesalers for the majority of our sales, any further
consolidation among wholesalers could adversely affect our pricing.
The pharmaceutical distribution industry has recently experienced a
significant consolidation among wholesalers and chain stores. As a consequence,
channels for wholesale and retail pharmaceutical distribution are less abundant
than historically available. As a consequence, we are dependent on fewer
distributors for our products and our ability to negotiate price terms with such
distributors has been eroded. While we believe that this consolidation among
distributors will ultimately reduce our distribution costs, our inability to
aggressively negotiate price terms with them, over the long term, could inhibit
our efforts to achieve targeted profit margins or sales levels. Notwithstanding
our ability to by-pass the wholesale distribution network by distributing our
products to end-users directly, there can be no assurance that the continued or
future consolidation among pharmaceutical distributors will not materially
adversely affect our ability to compete effectively.
<PAGE>
We may not be able to implement our business strategy because of government
regulations, lack of financing, inability to acquire profitable products, or
inability to retain key management.
Our principal strategy is to continue to expand our business through
the acquisition of businesses and new products, as well as product line
extensions, and increased marketing and distribution activities. We seek
products that we believe can be profitable under our management and which are
not subject to adverse FDA rulings. There are several factors which could limit
or restrict our ability to implement this strategy:
. Products that we might potentially acquire may be found to
be subject to adverse FDA rulings, in which case we would
not purchase such a product;
. We may not have the financing available to acquire an
available product, in part because all of our assets are
subject to a security interest in favor of LaSalle Business
Credit, Inc.;
. We may not be able to achieve our targeted profit margins with
certain products available for acquisition;
. We may not be able to attract and retain additional qualified
personnel to expand our marketing and distribution activities
to accommodate additional products;
. We may not successfully integrate any newly acquired product
into our operation.
There is no guarantee that sales of newly acquired products will be
profitable to us or that such products will meet anticipated sales levels.
Moreover, while we anticipate making future acquisitions in accordance with our
strategic plan, no assurance can be given that we will consummate any future
acquisitions or that we will be able to achieve the same rates of return and
historical sales levels of any product acquired. In addition, expansion of our
marketing and distribution activities will require us to attract and retain
additional qualified personnel. Although, to date, we have attracted and
retained qualified personnel, there is no assurance that we will be able to
continue to recruit or retain personnel of the requisite caliber or in adequate
numbers to enable us to implement our business strategy. Moreover, no assurance
can be given that we will be able to successfully integrate any newly acquired
product or business into our operations. The failure to do so could have a
material adverse effect on the growth of our sales and profitability, and
operations.
To implement our expansion strategy, we will need to finance new
product acquisitions from the new acquisition note to LaSalle, existing working
capital, positive cash flow from operations and new borrowings. While we are not
currently prohibited from other borrowings of money, our ability to grant liens
upon, and security interests in, our assets is restricted by the terms of our
loan agreement with LaSalle, which holds a security interest in substantially
all of our assets. This security interest could adversely affect our ability to
secure new asset-based borrowings if necessary. Accordingly, there can be no
assurance that we will be able to borrow,
<PAGE>
on commercially reasonable terms or otherwise, any additional funds
necessary to finance further acquisitions or support operations.
Competing products and technologies may make some or all of our products
non-competitive or obsolete.
The business of distributing pharmaceutical and health related products
is highly competitive. We compete primarily against established pharmaceutical
and consumer product companies which currently market products that are
equivalent or functionally similar to those we market. We focus our marketing
efforts on products for which the major competition are products sold by
companies that are not major pharmaceutical firms. We seek to compete based on
targeted marketing and promotional programs, lower prices and better service.
There can be no assurance that we will be successful in this regard. Moreover,
there can be no assurance that major pharmaceutical companies will not develop
and market new and innovative products competitive with any of our products.
Further, since most of our products are not protected by patents, products
similar in composition and intended use could be manufactured and distributed by
our competitors. Most of our competitors possess substantially greater
financial, technical and other resources than we do.
If we become subject to a product liability claim, we may not have adequate
insurance coverage.
Pharmaceutical and health related products, such as those we market,
may carry certain health risks. Consequently, we may be exposed to potential
product liability claims by consumers. We maintain a product liability insurance
policy providing direct coverage in the aggregate amount of $3,000,000 and we
are additionally insured under our manufacturers' policies. Our present
insurance may not be adequate in the event of an adverse judgment against us. In
the event that any product liability claim is not fully funded by insurance, or
if we are unable to recover damages from the manufacturer of a product that may
have caused such injury, we will be required to pay such claims from our own
funds. Any such payment could have a material adverse affect on our financial
condition. In addition, there is no assurance that we will be able to maintain
our liability insurance in effect in the future at reasonable premium rates, if
at all.
We are subject to chargebacks and rebates when our products are re-sold to
governmental agencies and managed care buying groups which may reduce our
future profit margins.
Chargebacks and rebates are the difference between the prices at which
we sell our products to wholesalers and the sales price ultimately paid by the
end-users, such as governmental agencies and managed care buying groups,
pursuant to fixed price contracts. We record an estimate of the amount either to
be charged back to us or rebated to the end-users at the time of sale to the
wholesaler. Over recent years, the managed care system of chargebacks and
rebates gained greater acceptance by the pharmaceutical industry in general.
Managed care organizations increasingly began using these chargebacks and
rebates as a method to reduce overall costs in drug procurement. Levels of
chargebacks and rebates have increased momentum and have caused a greater need
for more sophisticated tracking and data gathering to confirm
<PAGE>
sales at contract
prices to end-users with respect to related sales to wholesalers. We have
implemented new procedures, systems and policies which we believe more closely
monitor the managed care and government sales areas of our business. We record
an accrual for chargebacks and rebates based upon factors including current
contract prices, historical chargeback rates and actual chargebacks claimed. The
amount of actual chargebacks claimed could, however, be either higher than the
amounts we accrue and if so would reduce our profit margins.
Our officers and directors control our business and can authorize certain
corporate transactions without concurrence of our other stockholders.
Our executive officers and directors beneficially own 1,654,178 shares
of Class A common stock and 407,821 shares of Class B common stock. The Class B
common stock has five votes per share other than with respect to the election of
directors. At all times while there are at least 325,000 shares of Class B
common stock issued and outstanding, holders of the Class B common stock, voting
as a separate class, have the right to elect a majority of our board of
directors. Accordingly, our executive officers and directors currently have the
ability, and it is anticipated that in the future they will continue to have the
ability, to elect a majority of directors and thereby otherwise authorize
certain corporate transactions without concurrence of our other stockholders.
Loss of our Chairman and CEO could adversely affect how we operate our business.
Our day-to-day operations are managed by our President, Chief Executive
Officer and Chairman, Daniel Glassman. Mr. Glassman does not currently have an
employment agreement with us. The loss of the services of Mr. Glassman would
adversely affect how we operate our business.
The exercise of outstanding warrants and options or the issuance of additional
shares could adversely affect the market price of our stock.
There are currently outstanding a substantial number of options and
warrants entitling the holders thereof to purchase shares of Class A common
stock. In addition, the holders of shares of Class B common stock have the
unilateral right, exercisable at any time, to convert their shares of Class B
common stock into shares of Class A common stock. If all outstanding warrants
and options were exercised and all shares of Class B common stock converted into
shares of Class A common stock, approximately an additional 2,560,000 shares of
Class A common stock would be issued and be outstanding. The sale, or
availability for sale, of such substantial amounts of additional shares of Class
A common stock in the public marketplace could adversely affect the prevailing
market price of our securities and otherwise impair our ability to raise
additional capital through the sale of equity securities.
Because we will most likely not pay dividends, you will only profit from your
investment if stock price appreciates.
<PAGE>
Our credit facility with LaSalle currently prohibits us from paying any
cash dividends at any time while amounts remain outstanding under the LaSalle
credit facility. Moreover, and without giving effect to the terms of the LaSalle
credit facility, we currently do not intend to declare or pay cash dividends in
the foreseeable future. Earnings, if any, are expected to be retained to finance
and used to invest in our business.
Failure to successfully address the Year 2000 issue could adversely affect our
business.
As has been widely reported, many computer systems process dates based
on two digits for the year of transaction and may be unable to process dates in
the year 2000 and beyond. There are many risks associated with the year 2000
compliance issue, including but not limited to the possible failure of our
systems and hardware with embedded applications. Any such failure could result
in
. our inability to source inventory;
. the malfunctioning of our service processes,
. our inability to receive orders, properly bill and collect
payments from our customers; and
. errors or omissions in accounting and financial data, any of which
could have a material adverse effect on our results of operations
and financial condition.
In addition, there can be no guarantee that the systems of other companies,
including our vendors, utilities and customers, will be converted in a timely
manner, or that a failure to convert by another company, or a conversion that is
incompatible with our systems, would not have a material adverse effect on us.
We have not yet developed any contingency plans.
Since our charter includes issuing preferred stock and super-voting rights held
by the Chairman & CEO, it is unlikely we can be acquired by anyone without the
consent of our Board of Directors.
Our charter authorizes us to issue of up to 2,000,000 shares of
preferred stock with such designations, rights and preferences as may be
determined from time to time by the board of directors. The authorization of
such preferred stock empowers the board of directors, without further
stockholder approval, to issue preferred shares with dividend, liquidation,
conversion, voting or other rights which could adversely affect the voting power
or other rights of the holders of our common stock. In the event of issuance,
such preferred stock could be utilized, under certain circumstances, as a method
of discouraging, delaying or preventing a change of control. To date, no shares
of preferred stock have been issued. In addition, we are and will continue to
be, subject to the anti-takeover provisions of the Delaware General Corporation
Law, which could have the effect of delaying or preventing a change of control.
Our charter also provides that at all times while there are at least
325,000 shares of Class B common stock issued and outstanding, the holders of
the Class B common stock have the
<PAGE>
right, voting as a separate class, to elect a
majority of our Board of Directors. As of the date of this Prospectus, 431,552
shares of Class B common stock are issued and outstanding, 316,736 shares of
which are beneficially owned by Daniel Glassman, our President, Chief Executive
Officer and Chairman of the Board. As such, Mr. Glassman effectively controls us
and the existence of these shares of Class B common stock could have the effect
of preventing a change of control.
Our stock price has fluctuated considerably and may depreciate in value.
Stock prices of emerging growth pharmaceutical and micro-cap companies
such as ours are subject to significant fluctuations. The stock price may be
affected by a variety of factors that could cause the price of our common stock
to fluctuate, perhaps substantially, including:
. announcements of developments related to our business;
. quarterly fluctuations in our actual or anticipated operating
results;
. general conditions in the pharmaceutical and health care
industries;
. new products or product enhancements by us or our competitors;
. developments in patents or other intellectual property rights and
litigation; and
. developments in our relationships with our customers and
suppliers.
In addition, in recent years the stock market in general and the market for
shares for small capitalization and emerging growth pharmaceutical companies in
particular, have experienced extreme price fluctuations which may or may not
have been related to the operating performance of affected companies. Any such
fluctuations in the future could adversely affect the market price of our common
stock. There can be no assurance that the market price of our common stock will
not decline.
This prospectus includes forward-looking statements. All statements
other than statements of historical facts included in this prospectus, including
certain statements under the "Prospectus Summary", may constitute
forward-looking statements. We have based these forward-looking statements on
our current expectations and projections about future events. Although we
believe that our assumptions made in connection with the forward-looking
statements are reasonable, we cannot assure you that our assumptions and
expectations will prove to have been correct. Important factors that could cause
our actual results to differ from our expectations are disclosed below. These
risks and uncertainties include those relating to regulatory action, capital
requirements and competing products are described in the following section. We
undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
<PAGE>
RECENT FINANCING TRANSACTION
On April 7, 1999, we entered into a loan agreement with LaSalle that is
comprised of a $5 million revolving asset-based credit facility and a $2.5
million acquisition note for future product acquisitions. In order to close this
new loan agreement with LaSalle, we paid in full the outstanding loan balance
and early termination penalties to The CIT Group/Credit Finance, Inc. of
approximately $1.6 million using a portion of the availability from the new
revolving credit facility. Advances under this new revolving credit facility are
calculated pursuant to a formula which is based on our then "eligible" accounts
receivable and inventory levels. Advances under the $2.5 million acquisition
note are pursuant to having a potential acquisition and LaSalle's final
approval. This new loan agreement has an initial term of three years, requires
an annual facility fee, and is subject to an unused credit line percentage fee.
Interest accrues on amounts outstanding under this new loan agreement at the
rate equal to the prime rate of interest, from time to time, announced by
LaSalle National Bank plus 1% for the revolving credit facility and plus 2% for
the amount outstanding for the acquisition note. Our obligations under this new
loan have been collateralized by our grant to LaSalle of a security interest in
all of our inventory, accounts receivable, intangible assets and other assets.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934, and we therefore file reports, proxy statements and other
information with the Securities and Exchange Commission. Such reports, proxy
statements and other information can be inspected and copies at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the regional offices of the Commission located at
500 West Madison Street, Chicago, Illinois 60601 and 7 World Trade Center, New
York, New York 10048. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. Our common stock is quoted on Nasdaq, and such
reports, proxy statements and other information can also be inspected at the
offices of Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. Such
material may also be accessed electronically by means of the Securities and
Exchange Commission's home page on the Internet (http://www.sec.gov).
We have filed with the Commission a registration statement on Form S-3
with respect to the shares being offered hereby. You may obtain copies of the
registration statement from the Commission at the addresses in the previous
paragraph. This prospectus does not contain all of the information set forth in
the registration statement and its exhibits. We refer you to the registration
statement for further information about us and the shares. While we believe this
prospectus provides the material information regarding the contracts and
documents described herein, the statements contained in this prospectus as to
the contents of any contract or any other documents are not necessarily complete
and, in each such instance, you should refer to the copy of such contract or
document filed as an exhibit to the registration statement.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
<PAGE>
The following documents we filed with the Commission pursuant to the
Exchange Act (File No. 0-18881) are hereby incorporated by reference in this
prospectus, except as otherwise superseded or modified by this prospectus:
The Company's Annual Report on Form 10-KSB/A for the fiscal year ended
December 31, 1998, Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1999 and Form 8K filed April 16, 1999.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the termination
of the offering shall be deemed to be incorporated by reference into
this Prospectus.
Any statement contained in any document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this prospectus to the extent that a statement contained
herein or in any other subsequently filed documents which also is or is deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this prospectus.
We will furnish without charge to each person, including any beneficial
owner to whom this prospectus is delivered, upon his written or oral request, a
copy of any or all of the documents referred to above which have been
incorporated into this prospectus by reference (other than exhibits to such
documents). Requests for such copies should be directed to:
BRADLEY PHARMACEUTICALS, INC.
383 Route 46 West
Fairfield, New Jersey 07004
Attention: Daniel Glassman, Chairman of the Board
(973) 883-1505
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares by
Berlex and Stern Stewart.
SELLING SHAREHOLDERS
The shares are being registered pursuant to registration rights
obligations we have to Berlex and Stern Stewart. Other than the shares offered
hereby, neither Berlex nor Stern Stewart holds more than one (1%) percent of our
common stock nor have they or their principals ever held any position or office
with us. The shares listed for Berlex include 750,000 shares issuable upon the
exercise of warrants for $1.25 per share. All of Stern Stewart's shares are
issuable upon the exercise of warrants for $3.12 per share. We have been advised
that Berlex and Stern Stewart
<PAGE>
intend to sell the shares at unspecified times on
a delayed or continuous basis depending upon, among other things, favorable
market conditions.
The following table sets forth certain information with respect to the
beneficial ownership of the shares by Berlex and Stern Stewart:
<TABLE>
<S> <C> <C> <C>
Beneficial Beneficial
Ownership Number of Ownership
of Shares of Shares of of Shares of
Name of Selling Common Stock Common Stock Common Stock
Shareholder Prior to Offering to be Offered After Offering
- ----------------- ----------------- -------------- --------------
Berlex Laboratories, Inc. 2,200,000 2,200,000 0
Stern, Stewart & Co., Inc. 70,000 70,000 0
</TABLE>
PLAN OF DISTRIBUTION
Berlex and Stern Stewart have advised us that there are presently no
underwriting arrangements with respect to the sale of the shares; however, such
arrangements may exist in the future. Berlex and Stern Stewart, or their
pledges, donees transfers or other successors in interest, may choose to sell
all or a portion of the shares from time to time as market conditions permit in
the over-the-counter market, or otherwise, at prices and terms then prevailing
or at prices related to the then-current market price, or at negotiated prices.
The shares may also be sold by one or more of the following methods,
without limitation:
. block trades in which a broker or dealer so engaged will
attempt to sell the shares as agent but may position and
resell a portion of the block as principal to facilitate
the transaction;
. purchases by a broker or dealer as principal and resale
by such broker and dealer for its account pursuant to
this prospectus;
. ordinary brokerage transactions, which may include long
or short sales, and transactions in which the broker
solicits purchases;
<PAGE>
. "at the market" to or through market makers and into an
existing market for the shares;
. in other ways not involving market makers or established
trading markets, including direct sales to purchasers or
sales effected through agents;
. through transactions in options, swaps or other
derivatives, including transactions with broker-dealers
or other financial institutions that require the
delivery by such broker-dealers or institutions of the
shares, which shares may be resold thereafter pursuant
to this prospectus; or
. any combination of the foregoing, or by any other
legally available means.
In effecting sales, brokers or dealers engaged by Berlex or Stern
Stewart may arrange for other brokers or dealers to participate. Such broker or
dealers may receive commissions or discounts from Berlex and Stern Stewart in
amounts to be negotiated. Such brokers and dealers and any other participating
brokers or dealers may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales.
Notwithstanding the foregoing, we entered into an agreement with
Berlex pursuant to which Berlex has agreed that prior to it offering for sale,
transfer or assignment any of the shares in a private sale either through an
open market sale on Nasdaq or on a national securities exchange or an agreed
upon sale at which the price per share is determined or to be determined by an
agreement, written or otherwise, between Berlex and the prospective buyer of
such shares, not on Nasdaq or on a national securities exchange, Berlex shall
provide us with the opportunity to purchase the shares at the sales price. We
may exercise such opportunity by making payment of cash to Berlex within five
business days from our receipt of notice from Berlex, provided that we must, at
Berlex' request, provide prior to such payment evidence reasonably satisfactory
to Berlex that:
. the purchase of the shares by us will not constitute a
purchase in violation of applicable corporate or other
applicable law; and
. there will not occur within 91 days after the date of
such payment certain events of insolvency or bankruptcy.
In the event Berlex makes such a request, such five business day
period shall be extended by such time as is reasonably required for us to comply
with (1) and (2) above, up to two additional business days. If we fail to pay
for the shares within such time, Berlex may sell the shares during the next 30
days, in the case of an agreed upon sale, or 90 days in the case of an open
market sale, free of our right to purchase the shares; provided however, that
the sale of the shares shall, on an open market sale, be made on Nasdaq or on a
national securities exchange and in the event of an agreed upon sale be made at
the price not less than the offer price. In the event Berlex does not sell the
shares within such 30 or 90 day period, the above-described rights continue to
apply to any proposed private sale by Berlex of the shares.
<PAGE>
For purposes hereof, the sales price means:
. in the case of an open market sale, the price per share
which is equal to the average of the bid and asked price
published in the Wall Street Journal on the business day
before notice is sent by Berlex to us, or if there is no
bid and asked price on such business day, on the most
recent day on which a bid and asked price had been
published in the Wall Street Journal; or
. in the case of an agreed upon sale, the price per share
at which Berlex proposes to sell the shares.
INDEMNIFICATION
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant, we have been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, we will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
express in the Securities Act and will be governed by the final adjudication of
such issue.
LEGAL MATTERS
The legality of the Shares offered by this prospectus has been passed
upon by Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP, Woodbridge, New
Jersey.
EXPERTS
The consolidated financial statements as of December 31, 1998 and for
the year then ended incorporated in this prospectus by reference to the Annual
Report on Form 10-KSB/A have been audited by Grant Thornton, LLP, independent
certified public accountants, to the extent and for the periods set forth in
their reports incorporated herein in reliance upon such report given upon the
authority of said firms as experts in auditing and accounting.
<PAGE>
2,270,000 Shares of Common Stock
BRADLEY
PHARMACEUTICALS, INC.
PROSPECTUS
JULY , 1999
Until August , 1999, all dealers that effect
transactions in these securities, whether or not
participating in this offering, may be required to
deliver a prospectus. This is in addition to the
dealers' obligation to deliver a prospectus when acting
as underwriters and with respect to their unsold
allotments of subscriptions.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The registrant estimates expenses in connection with the offering described in
this Registration Statement will be as follows:
Item Amount
Securities and Exchange Commission Registration Fee $ 749.38
Printing and Engraving Expenses 500.00
Accountants' Fees and Expenses 4,000.00
Legal Fees and Expenses 4,000.00
NASDAQ Listing Fees -
Placement Agent's Fees and Expenses -
Miscellaneous 750.62
--------
Total $10,000.00
----------
----------
Item 15. Indemnification of Directors and Officers.
The description set forth under the caption "Indemnification of
Directors and Officers" in the Company's Registration Statement on Form SB-2,
filed October 15, 1997, No. 33-37935, is incorporated herein by reference.
Item 16. Exhibits.
Exhibit
Numbers Description of Documents
3.1 Certificate of Incorporation of the Company, as amended (Incorporated
by reference from the Company's Proxy Statement for the 1998 Annual
Meeting)
3.2 By-laws of the Registrant, as amended (Incorporated by reference from
the Company's Proxy Statement for the 1998 Annual Meeting)
4.1 Placement Agent's Unit Purchase Option (Incorporated by reference
from the Company's Proxy Statement for the 1998 Annual Meeting)
<PAGE>
10.1 1990 Stock Option Plan, as amended (Incorporated by reference to
Exhibit 10.1 to the Company's Annual Report on Form 10-KSB for the
year ended December 31, 1996.
10.2 Form of 11% Subordinated Note dated June 14, 1990 (Incorporated by
reference to Exhibit 10.6 to the Company's Registration Statement on
Form S-1, Registration No.
33-36120)
10.3 Asset Purchase Agreement between the Company and Hoechst Roussel
Pharmaceuticals Incorporated (Incorporated by reference to Exhibit
10.10 to the Company's Registration Statement on Form S-1,
Registration No. 33-36120)
10.4 Asset Purchase Agreement dated December 15, 1992 between the Company,
Upsher Smith and Kenneth Evenstad (Incorporated by reference to
Exhibit 10.1 to the Company's Current Report on Form 8-K for an event
dated December 15, 1992)
10.5 Manufacturing Agreement dated December 15, 1992 between the Company,
Upsher Smith and Kenneth Evenstad (Incorporated by reference to
Exhibit 10.2 to the Company's Current Report on Form 8-K for an event
dated December 15, 1992)
10.6 Asset Purchase Agreement dated March 30, 1993 between the Company and
Tsumura Medical Inc. (Incorporated by Reference to Exhibit 10.9 to
the Company's Annual Report on Form 10-K for the year ended December
31, 1992
10.7 Trademark Security Agreement dated March 30, 1993 between the Company
and Tsumura International Inc. (Incorporated by reference to Exhibit
10.10 to the Company's Annual Report on Form 10-K for the year ended
December 31, 1993
10.8 Purchase Agreement dated November 10, 1993 between Berlex and the
Company, as amended by Amendments Numbers One and Two thereto, dated
November 19, 1993 and December 9, 1993, respectively (Incorporated by
reference to Exhibits 10.1 through 10.3 to the Company's Current
Report on Form 8-K for an event dated December 10, 1993)
10.9 Trademark Security Agreement dated December 9, 1993 between Berlex
and the Company (Incorporated by reference to Exhibit 10.4 to the
Company's Current Report on Form 8-K for an event dated December 10,
1993)
10.10 Supply and Distribution Agreement dated December 9, 1993 between
Berlex and the Company (Incorporated by reference to Exhibit 10.5 to
the Company's Current Report on Form 8-K for an event dated December
10, 1993)
10.11 Form of Plan of Merger dated as of January 31, 1994 between Doak and
the Company (Incorporated by reference to Exhibit 10.2 to the
Company's Current Report on Form 8-K for an event dated February 14,
1994)
<PAGE>
10.13 Consulting Agreement dated as of January 31, 1994 between the Company
and Dr. Krafchuk (Incorporated by references to Exhibit 10.3 to the
Company's Current Report on Form 8-K for an event dated February 14,
1994)
10.14 Consulting Agreement dated as of January 31, 1994 between the Company
and Mrs. Krafchuk (Incorporated by reference to Exhibit 10.4 to the
Company's Current Report on Form 8-K for an event dated February 14,
1994)
10.15 Lease Modification Agreement dated as of February 1994 between
Dermkraft, Inc. and Doak (Incorporated by reference to Exhibit 10.6
to the Company's Current Report on Form 8-K for an event dated
February 14, 1994)
10.16 Purchase and Assignment Agreement between Upjohn and the Company
(Incorporated by reference to Exhibit 10.21 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1993)
10.17 Amendment No. 4 dated January 6, 1996 to the Asset Purchase Agreement
dated November 10, 1993 between Berlex Laboratories, Inc. and the
Company (Incorporated by reference to Exhibit 10.1 to the Company's
Current Report on Form 8-K for an event dated January 5, 1996)
10.18 Security Agreement dated as of January 5, 1995 between the Company
and Berlex Laboratories, Inc. (Incorporated by reference to Exhibit
10.2 to the Company's Current Report on Form 8-K for an event dated
January 5, 1996)
10.19 Amendment to Trademark Security Agreement dated as of January 5,
1995, between the Company and Berlex Laboratories, Inc. (Incorporated
by reference to Exhibit 10.3 to the Company's Current Report on Form
8-K for an event dated January 5, 1996)
10.20 Settlement Agreement dated as of September 30, 1996 among the
Company, Stiefel Canada, Inc., Trans CanaDerm, Inc. and Louis Vogel
et al. (Incorporated by reference to Exhibit 10.1 to the Company's
Current Report on Form 8-K for an event dated September 30, 1996)
10.21 Amendment No. 5 dated as of December 23, 1996 to the Asset Purchase
Agreement between the Company and Berlex (Incorporated by reference
to Exhibit 10.1 to the Company's Current Report on Form 8-K for an
event dated December 23, 1996)
10.22 Security Agreement and subsidiary Security Agreement dated as of
December 23, 1996 among Doak Dermatologics, Inc. and Berlex
(Incorporated by reference to Exhibit 10.2 to the Company Current
Report on Form 8-K for an event dated December 23, 1996)
10.23 Confession of Judgment from the Company and Doak Dermatologics, Inc.
with respect to the March 1997 payment (Incorporated by reference to
Exhibit 10.3 to the Company's Current Report on Form 8-K for an event
dated December 23, 1996)
<PAGE>
10.24 Amendment No. 6 to Asset Purchase Agreement dated as of September 19,
1997 between the Company and Berlex
10.25 Warrant to Purchase up to 750,000 Shares of Class A Common Stock of
the Company issued to Berlex
10.26 Loan and Security Agreement dated as of September 19, 1997 among CIT,
the Company, Doak, Bradley Pharmaceuticals (Canada), Inc. and Bradley
Pharmaceuticals Overseas, Ltd.
10.27 Assignment, Security Agreement and Mortgage - Trademarks and Patents,
dated as of September 19, 1997 between Doak and CIT
10.28 Assignment, Security Agreement and Mortgage - Trademarks, dated as of
September 19, 1997 between Doak and CIT
10.29 Guaranty dated September 19, 1997 of Daniel Glassman issued to CIT
21.1 Subsidiaries of the Registrant (Incorporated by reference to Exhibit
21.1 to the Company's Annual Report on Form 10-KSB for the year ended
December 31, 1996)
23.2 Consent of Grant Thornton LLP (page II-9)
24.1 Power of Attorney (page II-6)
Item 17. Undertakings.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant, the registrant has been advised that in the opinion the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is
<PAGE>
against public policy as express in the Act and will be governed by the final
adjudication of such issue. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made of the securities registered hereby, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information set forth
in the Registration Statement; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information in the
Registration Statement; provided, however, that the undertakings set forth in
paragraphs (i) and (ii) above do not apply if the Registration Statement is
on Form S-3 or Form S-8 and the information required to be included in
a post-effective amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable ground to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 2 to its Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Fairfield, New Jersey, on the 6th of
July , 1999.
BRADLEY PHARMACEUTICALS, INC.
By: /s/ Daniel Glassman
--------------------------
DANIEL GLASSMAN
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated:
Signature Title Date
/s/ Daniel Glassman Chairman of the Board July 6, 1999
Daniel Glassman President and Chief
Executive Officer
/s/ * Treasurer and Director July 6, 1999
Iris S. Glassman
/s/ * Secretary and Director July 6, 1999
David H. Hillman
/s/ * Director July 6, 1999
Philip W. McGinn, Jr.
/s/ * Director July 6, 1999
Seymour I. Schlager
/s/ * Director July 6, 1999
Alan G. Wolin
*By: /s/ Daniel Glassman
Daniel Glassman, as
attorney-in-fact
<PAGE>
Exhibit 5
Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP
Metro Corporate Campus One
P.O. Box 5600
Woodbridge, NJ 07095-0988
July 7, 1999
Bradley Pharmaceuticals, Inc.
383 Route 46 West
Fairfield, New Jersey 07004
Re: Bradley Pharmaceuticals, Inc.
Gentlemen:
We have acted as counsel to Bradley Pharmaceuticals, Inc., a
Delaware Corporation (the "Company"), in connection with the filing by the
Company of a Registration Statement on Form S-3 (Registration No. 333-75997),
covering the registration of 2,270,000 shares of common stock, par value $.01
per share ("Common Stock"). We have been asked to issue an opinion as to whether
the Common Stock being registered will, when sold, be legally issued, fully
paid, non-assessable, and binding obligations of the Company.
As counsel to the Company, we have examined the Certificate of
Incorporation and By-Laws, as amended to date, and other corporate records of
the Company and have made such other investigations as we have deemed necessary
in connection with the opinion hereinafter set forth. We have relied, to the
extent we deem such reliance proper, upon certain factual representations of
officers and directors of the Company given in certificates, in answer to our
written inquiries and otherwise, and, although we have not independently
verified all of the facts contained therein, nothing has come to our attention
that would cause us to believe that any of the statements contained therein are
untrue or misleading.
In making the aforesaid examinations, we have assumed the genuineness
of all signatures and the conformity to original documents of all copies
furnished to us. We have assumed that the corporate records of the Company
furnished to us constitute all of the existing corporate records of the Company
and include all corporate proceedings taken by it.
Based solely upon and subject to the foregoing, we are of the opinion
that the shares of Common Stock are duly authorized, issued and full paid and
non-assessable, and the issuance of such shares by the Company is not subject to
any preemptive or similar rights.
<PAGE>
We hereby consent to the filing of this opinion as an Exhibit to the
aforesaid Registration Statement and to the reference to our firm under the
caption "Legal Matters" in the Prospectus.
Very truly yours,
Greenbaum, Rowe, Smith,
Ravin, Davis & Himmel LLP
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated March 9, 1999 accompanying the consolidated
financial statements of Bradley Pharmaceuticals, Inc. appearing in the Annual
Report on Form 10-KSB/A for the year ended December 31, 1998 which is
incorporated by reference in this Registration Statement. We consent to the
incorporation by reference in the Registration Statement of the aforementioned
report and to the use of our name as it appears under the caption "Experts."
GRANT THORNTON LLP
Parsippany, New Jersey
July 7, 1999
