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<DIV><BR>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><STRONG>SECURITIES
AND EXCHANGE COMMISSION</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><STRONG>WASHINGTON,
D.C.&nbsp;&nbsp;20549</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><STRONG>FORM
8-K</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><STRONG>CURRENT
REPORT</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Pursuant
to Section 13 OR 15(d) of the Securities Exchange Act of
1934</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">DATE OF
REPORT - FEBRUARY 25, 2005</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Date of
Earliest Event Reported)</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 86.4pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><STRONG><U>COLUMBIA
LABORATORIES, INC.</U></STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
name of registrant as specified in its charter)</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Commission
File No. 1-10352</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV align=left>
<TABLE cellSpacing=0 cellPadding=0 width="100%">
  <TR>
    <TD style="BORDER-BOTTOM: black thin solid" vAlign=top align=middle
    width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Delaware</FONT></DIV></TD>
    <TD vAlign=top align=left width="33%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: black thin solid" vAlign=top align=middle
    width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">59-2758596</FONT></DIV></TD></TR>
  <TR>
    <TD vAlign=top align=middle width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(State
      of Incorporation)</FONT></DIV></TD>
    <TD vAlign=top align=left width="33%">&nbsp;</TD>
    <TD vAlign=top align=middle width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(I.R.S.
      Employer</FONT></DIV>
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Identification
      No.)</FONT></DIV></TD></TR>
  <TR>
    <TD vAlign=top align=middle width="33%">&nbsp;</TD>
    <TD vAlign=top align=left width="33%">&nbsp;</TD>
    <TD vAlign=top align=middle width="33%">&nbsp;</TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: black thin solid" vAlign=top align=middle
    width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">354
      Eisenhower Parkway</FONT></DIV>
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Livingston,
      New Jersey</FONT></DIV></TD>
    <TD vAlign=top align=left width="33%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: black thin solid" vAlign=top align=middle
    width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center>&nbsp;</DIV>
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">07039</FONT></DIV></TD></TR>
  <TR>
    <TD vAlign=top align=middle width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
      of principal</FONT></DIV>
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">executive
      offices)</FONT></DIV></TD>
    <TD vAlign=top align=left width="33%">&nbsp;</TD>
    <TD vAlign=top align=middle width="33%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 21.6pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zip
      Code</FONT></DIV></TD></TR></TABLE></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Registrant&#8217;s
telephone number, including area code: (973) 994-3999</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">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):</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><FONT
face=Wingdings>o </FONT>Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><FONT
face=Wingdings>o </FONT>Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><FONT
face=Wingdings>o </FONT>Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><FONT
face=Wingdings>o </FONT>Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV><BR>
<DIV id=PGBRK style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
<DIV id=FTR>
<DIV id=GLFTR style="WIDTH: 100%" align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV>
<DIV id=PN style="PAGE-BREAK-AFTER: always">
<DIV style="WIDTH: 100%; TEXT-ALIGN: center"><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt" face="Times New Roman"></FONT></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center">
<HR color=#000000 noShade SIZE=2>
</DIV></DIV>
<DIV id=HDR>
<DIV id=GLHDR style="WIDTH: 100%" align=right><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV></DIV><BR>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Item
1.01.</STRONG></FONT><FONT id=TAB2
style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Entry
into a Material Definitive Agreement.</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A.
Employment Agreement with Robert S. Mills. </FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
February 25, 2005, Columbia Laboratories, Inc. (the &#8220;Company&#8221;) entered into an
employment agreement (the &#8220;Agreement&#8221;) with Robert S. Mills defining the terms
of his employment with the Company as its Senior Vice President and Chief
Operating Officer. The initial term of Mr. Mills&#8217; employment under the Agreement
is through March 31, 2007, with automatic one-year renewals unless either party
gives written notice of nonrenewal at least sixty (60) days prior to the end of
the then current term. If the Company elects not to renew the Agreement, it is
obligated to pay severance equal to one year&#8217;s base salary to Mr. Mills.
</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Mr.
Mills&#8217; annual base salary is $300,000 subject to annual review and, within the
discretion of the Board of Directors, upward adjustment. He received a signing
bonus of $20,000. Mr. Mills will also receive $30,000 upon FDA approval on or
before December 31, 2005, of an NDA supplement providing for a second
manufacturing site for Striant&#174; (testosterone buccal system) and $50,000 upon
completion on or before December 31, 2005, of subject enrollment in the PROTERM&#8482;
study.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Mr. Mills
is eligible to receive a target annual bonus of 40% of his base salary, as then
in effect, based upon the parameters and criteria contained in the Company&#8217;s
bonus plan, within the discretion of the Board of Directors and in consultation
with the Company&#8217;s President. Mr. Mills&#8217; actual bonus award may be higher or
lower than the target bonus amount based upon achievement of the objectives by
Mr. Mills and the Company. Mr. Mills is also entitled to participate in the
benefit programs generally available to Company employees.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
provided in the Agreement, Mr. Mills received a grant to purchase 175,000 shares
of the Company&#8217;s Common Stock under the Company&#8217;s 1996&nbsp;Long-term
Performance Plan. The options, which vest at the rate of 25% per year over four
years subject to Mr. Mills&#8217; continued employment, have an exercise price of
$2.05 per share, which is equal to the average of the high and low price of the
Company&#8217;s Common Stock on February 25, 2005, on the Nasdaq National
Market.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Mr. Mills
has the right, under the Agreement, to resign his employment for "Good Reason,"
as that term is defined in the Agreement. The Company has the right, under the
Agreement, to terminate Mr. Mills&#8217; employment with or without "Cause," as that
term is defined in the Agreement. </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Termination
for Cause for certain act(s) or failure(s) to act would not take effect unless
and until the Company gives Mr. Mills written notice of the Company&#8217;s intention
to terminate his employment for Cause, stating in detail the particular act(s)
or failure(s) to act that constitute the grounds on which the proposed
termination for Cause is based, and an opportunity to cure such conduct, if
possible. </FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT id=TAB1 style="MARGIN-LEFT: 36pt"></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"></FONT>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If Mr.
Mills&#8217; employment is terminated by the Company without Cause or by Mr. Mills
with Good Reason, the Agreement provides for payment of Mr. Mills&#8217; base salary
through the date of termination and a lump sum cash payment of one year's annual
base salary plus </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
greater of the amount of the cash bonus paid to Mr. Mills in the preceding year
pursuant to </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
Company&#8217;s bonus plan </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">or his
target bonus in effect at the time of the termination</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">. Mr.
Mills will also be entitled to receive the medical and dental coverage in effect
on his Termination Date for a period of twelve (12) months
thereafter.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV id=PGBRK style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
<DIV id=FTR>
<DIV id=GLFTR style="WIDTH: 100%" align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV>
<DIV id=PN style="PAGE-BREAK-AFTER: always">
<DIV style="WIDTH: 100%; TEXT-ALIGN: center"><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt" face="Times New Roman"></FONT></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center">
<HR color=#000000 noShade SIZE=2>
</DIV></DIV>
<DIV id=HDR>
<DIV id=GLHDR style="WIDTH: 100%" align=right><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Agreement incorporates without change Mr. Mills&#8217; </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Executive
Change in Control Severance Agreement dated as of April 8, 2004.</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"> In the
event of a &#8220;Change in Control&#8221; of the Company, as that term is defined in the
</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Executive
Change in Control Severance Agreement, and</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"> Mr.
Mills&#8217; employment is terminated by the Company without &#8220;Cause&#8221; or by Mr. Mills
with &#8220;Good Reason&#8221;, as those terms are defined in the </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Executive
Change in Control Severance Agreement</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"> (and
within the time periods provided)</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">,</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"> Mr.
Mills&#8217; would receive a lump sum cash payment equal to one year's annual base
salary, plus </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
greater of the cash bonus paid to Mr. Mills in the preceding year pursuant to
</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
Company&#8217;s bonus plan </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">or his
target bonus in effect at the time of the termination</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">, plus
the value of fringe benefits provided to him for the year prior to the Change in
Control.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A copy of
Mr. Mills&#8217; Agreement is attached as Exhibit 99.1 to this Form 8-K and is
incorporated herein by reference. </FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">B. Awards
to Executive Officers under the Columbia Laboratories Inc. Incentive Plan,
2004.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Columbia Laboratories, Inc. Incentive Plan (the &#8220;Plan&#8221;), in effect for 2004, is
intended to encourage and reward participants for achievement of the Company&#8217;s
financial, tactical and strategic objectives; to reinforce a strong performance
orientation with variability in awards based upon individual contribution and
teamwork; and, to provide a fully competitive compensation package that will
enable the Company to attract, reward and retain high caliber
employees.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
general, all employees are eligible to participate in the Plan, except employees
who are eligible for another incentive plan (e.g., sales incentives). Employees
hired after February 28, but before October 1, are eligible for a pro-rated
incentive award based on their hire date. Employees hired on or after October 1,
are not eligible to participate that year. To be eligible for an incentive
award, an employee must be actively employed on the date of distribution of
awards for the year. </FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
Plan, each eligible employee has an incentive target that is expressed in units
as a percentage of the employee&#8217;s base salary. The incentive target relates to
the employee&#8217;s position level and ranges from 4% for hourly employees to 30% for
executive officers, with the exception of the Company&#8217;s President and Chief
Executive Officer, G. Frederick Wilkinson, whose employment contract establishes
an incentive target of 50%. The performance criteria and relative weightings of
each performance factor are approved by the Board of Directors. A target
incentive pool is established annually in relation to the sum of the target
incentive award opportunities for all employees. The number of units in the
final incentive pool available for payout is a function of Company performance
against the performance criteria, which consist of pre-determined financial and
strategic objectives. The total number of units in the pool may be more or less
than the target incentive pool based on Company performance. Individual awards
take into account both the number of units in the final incentive pool available
for payout and individual performance. Awards may be made in cash, stock
options, or a combination thereof.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV id=PGBRK style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
<DIV id=FTR>
<DIV id=GLFTR style="WIDTH: 100%" align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV>
<DIV id=PN style="PAGE-BREAK-AFTER: always">
<DIV style="WIDTH: 100%; TEXT-ALIGN: center"><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt" face="Times New Roman"></FONT></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center">
<HR color=#000000 noShade SIZE=2>
</DIV></DIV>
<DIV id=HDR>
<DIV id=GLHDR style="WIDTH: 100%" align=right><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For the
fiscal year ended December 31, 2004, the Board fixed specified financial and
strategic performance goals for funding the incentive pool, and assigned
financial goals a 50% weighting and strategic goals a 50% weighting. The Company
did not fully meet the performance goals and the Board therefore funded the
incentive pool at 45% of the target incentive pool. </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth the a</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">wards
under the Plan for the </FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Company's
Chief Executive Officer ("CEO") and each of the four other most highly
compensated executive officers of the Company in 2004.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><BR></DIV>
<DIV>
<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=middle
    width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Name
      and Position</STRONG></FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=middle
    width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Award
      in Cash</STRONG></FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=middle
    width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=center><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Award
      in Stock Options **</STRONG></FONT></DIV></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=top align=left width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">G.
      Frederick Wilkinson,</FONT></DIV>
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">President
      &amp; Chief Executive Officer</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">None</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">56,250</FONT></DIV></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=top align=left width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Robert
      S. Mills, Senior Vice President &amp; Chief Operating
    Officer</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">None</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">31,350</FONT></DIV></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=top align=left width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">James
      J. Apostolakis, Vice President, Investor Relations</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">*</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">*</FONT></DIV></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=top align=left width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Michael
      McGrane, Vice President, General Counsel &amp; Secretary</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$25,500</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12,435</FONT></DIV></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: medium none" vAlign=top align=left width="35%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=left><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">David
      L. Weinberg, Vice President &amp; Chief Financial Officer</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$15,000</FONT></DIV></TD>
    <TD style="BORDER-BOTTOM: medium none" vAlign=center align=right
width="22%">
      <DIV
      style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
      align=right><FONT
      style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7,315</FONT></DIV></TD></TR></TABLE></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">*
Effective December 31, 2004, Mr. Apostolakis' role as Vice President, Investor
Relations, was terminated, making him ineligible for an award under the
Plan.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">**
Options were granted on February 25, 2005, under the Company&#8217;s
1996&nbsp;Long-term Performance Plan, vest immediately, and have an exercise
price of $2.05 per share, which is equal to the average of the high and low
price of the Company&#8217;s Common Stock on February 25, 2005, on the Nasdaq National
Market.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A copy of
the Columbia Laboratories Inc. Incentive Plan, 2004, is attached as Exhibit 99.2
to this Form 8-K and is incorporated herein by reference. </FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Item
9.01</STRONG></FONT><FONT id=TAB2
style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><STRONG>Financial
Statements and Exhibits</STRONG></FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</FONT><FONT
id=TAB2 style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;<FONT id=TAB2
style="LETTER-SPACING: 9pt">&nbsp;&nbsp;&nbsp;</FONT>&nbsp;</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exhibits.&nbsp;
</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"></FONT>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1<FONT
id=TAB2 style="LETTER-SPACING: 9pt">&nbsp;&nbsp;&nbsp;</FONT>&nbsp;</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Employment
Agreement by and between Columbia Laboratories, Inc., and Robert S. Mills dated
February 25, 2005.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"></FONT>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.2<FONT
id=TAB2 style="LETTER-SPACING: 9pt">&nbsp;&nbsp;&nbsp;</FONT>&nbsp;</FONT><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Columbia
Laboratories Inc. Incentive Plan, 2004</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV><BR>
<DIV id=PGBRK style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
<DIV id=FTR>
<DIV id=GLFTR style="WIDTH: 100%" align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV>
<DIV id=PN style="PAGE-BREAK-AFTER: always">
<DIV style="WIDTH: 100%; TEXT-ALIGN: center"><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt" face="Times New Roman"></FONT></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center">
<HR color=#000000 noShade SIZE=2>
</DIV></DIV>
<DIV id=HDR>
<DIV id=GLHDR style="WIDTH: 100%" align=right><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV></DIV><BR>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=center></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 72pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=center><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><U>SIGNATURE</U></FONT></DIV><BR></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">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.</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
align=justify>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:
March 1, 2005</FONT></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left>
<TABLE cellSpacing=0 cellPadding=0 width="100%" align=center bgColor=#ffffff
border=0>
  <TR vAlign=top bgColor=#ffffff>
    <TD width="50%"><FONT face="Times New Roman" size=2>&nbsp;</FONT></TD>
    <TD width="1%"><FONT face="Times New Roman" size=2>&nbsp;</FONT></TD>
    <TD width="49%"><FONT face="Times New Roman" size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top bgColor=#ffffff>
    <TD><FONT face="Times New Roman" size=2>&nbsp;</FONT></TD>
    <TD colSpan=2><FONT face="Times New Roman" size=2><STRONG>COLUMBIA
      LABORATORIES, INC.</STRONG></FONT></TD></TR>
  <TR vAlign=top bgColor=#ffffff>
    <TD><FONT face="Times New Roman" size=2>&nbsp;<BR>&nbsp;</FONT></TD>
    <TD><FONT face="Times New Roman" size=2>&nbsp;<BR>&nbsp;</FONT></TD>
    <TD><FONT face="Times New Roman" size=2>&nbsp;<BR>&nbsp;</FONT></TD></TR>
  <TR vAlign=top bgColor=#ffffff>
    <TD><FONT face="Times New Roman" size=2></FONT></TD>
    <TD><FONT face="Times New Roman" size=2>By:&nbsp;&nbsp;</FONT></TD>
    <TD><FONT face="Times New Roman" size=2>/S/ David L. Weinberg</FONT></TD></TR>
  <TR vAlign=top bgColor=#ffffff>
    <TD colSpan=2><FONT face="Times New Roman" size=1>&nbsp;</FONT></TD>
    <TD align=left>
      <HR align=left width="80%" color=#000000 noShade SIZE=2>
      <FONT size=2>David L. Weinberg</FONT></TD></TR>
  <TR vAlign=top bgColor=#ffffff>
    <TD colSpan=2><FONT face="Times New Roman" size=2>&nbsp;</FONT></TD>
    <TD><FONT face="Times New Roman" size=2>Vice President and Chief Financial
      Officer </FONT></TD></TR></TABLE></DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left><STRONG><FONT size=2></FONT></STRONG>&nbsp;</DIV>
<DIV
style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 50.4pt"
align=left>&nbsp;</DIV>
<DIV id=PGBRK style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
<DIV id=FTR>
<DIV id=GLFTR style="WIDTH: 100%" align=left><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman"></FONT></DIV></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center"><FONT
style="DISPLAY: inline; FONT-SIZE: 8pt" face="Times New Roman"></FONT></DIV>
<DIV style="WIDTH: 100%; TEXT-ALIGN: center">
<HR color=#000000 noShade SIZE=2>
</DIV></DIV>
<DIV id=HDR>
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{"company-data": {"conformed-name": "COLUMBIA LABORATORIES INC", "cik": "0000821995", "assigned-sic": "2834", "irs-number": "592758596", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-10352", "film-number": "05650299"}, "business-address": {"street1": "354 EISENHOWER PARKWAY", "city": "LIVINGSTON", "state": "NJ", "zip": "07039", "phone": "9739943999"}, "mail-address": {"street1": "354 EISENHOWER PARKWAY", "city": "LIVINGSTON", "state": "NJ", "zip": "07039"}}
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 - FEBRUARY 25, 2005
(Date of
Earliest Event Reported)
COLUMBIA
LABORATORIES, INC.
(Exact
name of registrant as specified in its charter)
Commission
File No. 1-10352
Delaware
59-2758596
(State
      of Incorporation)
(I.R.S.
      Employer
Identification
      No.)
354
      Eisenhower Parkway
Livingston,
      New Jersey
07039
(Address
      of principal
executive
      offices)
Zip
      Code
Registrant's
telephone number, including area code: (973) 994-3999
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):
o
Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
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.
A.
Employment Agreement with Robert S. Mills.
On
February 25, 2005, Columbia Laboratories, Inc. (the "Company") entered into an
employment agreement (the "Agreement") with Robert S. Mills defining the terms
of his employment with the Company as its Senior Vice President and Chief
Operating Officer. The initial term of Mr. Mills' employment under the Agreement
is through March 31, 2007, with automatic one-year renewals unless either party
gives written notice of nonrenewal at least sixty (60) days prior to the end of
the then current term. If the Company elects not to renew the Agreement, it is
obligated to pay severance equal to one year's base salary to Mr. Mills.
Mr.
Mills' annual base salary is $300,000 subject to annual review and, within the
discretion of the Board of Directors, upward adjustment. He received a signing
bonus of $20,000. Mr. Mills will also receive $30,000 upon FDA approval on or
before December 31, 2005, of an NDA supplement providing for a second
manufacturing site for Striant® (testosterone buccal system) and $50,000 upon
completion on or before December 31, 2005, of subject enrollment in the PROTERM™
study.
Mr. Mills
is eligible to receive a target annual bonus of 40% of his base salary, as then
in effect, based upon the parameters and criteria contained in the Company's
bonus plan, within the discretion of the Board of Directors and in consultation
with the Company's President. Mr. Mills' actual bonus award may be higher or
lower than the target bonus amount based upon achievement of the objectives by
Mr. Mills and the Company. Mr. Mills is also entitled to participate in the
benefit programs generally available to Company employees.
As
provided in the Agreement, Mr. Mills received a grant to purchase 175,000 shares
of the Company's Common Stock under the Company's 1996 Long-term
Performance Plan. The options, which vest at the rate of 25% per year over four
years subject to Mr. Mills' continued employment, have an exercise price of
$2.05 per share, which is equal to the average of the high and low price of the
Company's Common Stock on February 25, 2005, on the Nasdaq National
Market.
Mr. Mills
has the right, under the Agreement, to resign his employment for "Good Reason,"
as that term is defined in the Agreement. The Company has the right, under the
Agreement, to terminate Mr. Mills' employment with or without "Cause," as that
term is defined in the Agreement.
Termination
for Cause for certain act(s) or failure(s) to act would not take effect unless
and until the Company gives Mr. Mills written notice of the Company's intention
to terminate his employment for Cause, stating in detail the particular act(s)
or failure(s) to act that constitute the grounds on which the proposed
termination for Cause is based, and an opportunity to cure such conduct, if
possible.
If Mr.
Mills' employment is terminated by the Company without Cause or by Mr. Mills
with Good Reason, the Agreement provides for payment of Mr. Mills' base salary
through the date of termination and a lump sum cash payment of one year's annual
base salary plus
the
greater of the amount of the cash bonus paid to Mr. Mills in the preceding year
pursuant to
the
Company's bonus plan
or his
target bonus in effect at the time of the termination
. Mr.
Mills will also be entitled to receive the medical and dental coverage in effect
on his Termination Date for a period of twelve (12) months
thereafter.
The
Agreement incorporates without change Mr. Mills'
Executive
Change in Control Severance Agreement dated as of April 8, 2004.
In the
event of a "Change in Control" of the Company, as that term is defined in the
Executive
Change in Control Severance Agreement, and
Mr.
Mills' employment is terminated by the Company without "Cause" or by Mr. Mills
with "Good Reason", as those terms are defined in the
Executive
Change in Control Severance Agreement
(and
within the time periods provided)
,
Mr.
Mills' would receive a lump sum cash payment equal to one year's annual base
salary, plus
the
greater of the cash bonus paid to Mr. Mills in the preceding year pursuant to
the
Company's bonus plan
or his
target bonus in effect at the time of the termination
, plus
the value of fringe benefits provided to him for the year prior to the Change in
Control.
A copy of
Mr. Mills' Agreement is attached as Exhibit 99.1 to this Form 8-K and is
incorporated herein by reference.
B. Awards
to Executive Officers under the Columbia Laboratories Inc. Incentive Plan,
2004.
The
Columbia Laboratories, Inc. Incentive Plan (the "Plan"), in effect for 2004, is
intended to encourage and reward participants for achievement of the Company's
financial, tactical and strategic objectives; to reinforce a strong performance
orientation with variability in awards based upon individual contribution and
teamwork; and, to provide a fully competitive compensation package that will
enable the Company to attract, reward and retain high caliber
employees.
In
general, all employees are eligible to participate in the Plan, except employees
who are eligible for another incentive plan (e.g., sales incentives). Employees
hired after February 28, but before October 1, are eligible for a pro-rated
incentive award based on their hire date. Employees hired on or after October 1,
are not eligible to participate that year. To be eligible for an incentive
award, an employee must be actively employed on the date of distribution of
awards for the year.
Under the
Plan, each eligible employee has an incentive target that is expressed in units
as a percentage of the employee's base salary. The incentive target relates to
the employee's position level and ranges from 4% for hourly employees to 30% for
executive officers, with the exception of the Company's President and Chief
Executive Officer, G. Frederick Wilkinson, whose employment contract establishes
an incentive target of 50%. The performance criteria and relative weightings of
each performance factor are approved by the Board of Directors. A target
incentive pool is established annually in relation to the sum of the target
incentive award opportunities for all employees. The number of units in the
final incentive pool available for payout is a function of Company performance
against the performance criteria, which consist of pre-determined financial and
strategic objectives. The total number of units in the pool may be more or less
than the target incentive pool based on Company performance. Individual awards
take into account both the number of units in the final incentive pool available
for payout and individual performance. Awards may be made in cash, stock
options, or a combination thereof.
For the
fiscal year ended December 31, 2004, the Board fixed specified financial and
strategic performance goals for funding the incentive pool, and assigned
financial goals a 50% weighting and strategic goals a 50% weighting. The Company
did not fully meet the performance goals and the Board therefore funded the
incentive pool at 45% of the target incentive pool.
The
following table sets forth the a
wards
under the Plan for the
Company's
Chief Executive Officer ("CEO") and each of the four other most highly
compensated executive officers of the Company in 2004.
Name
      and Position
Award
      in Cash
Award
      in Stock Options **
G.
      Frederick Wilkinson,
President
      & Chief Executive Officer
None
56,250
Robert
      S. Mills, Senior Vice President & Chief Operating
    Officer
None
31,350
James
      J. Apostolakis, Vice President, Investor Relations
*
*
Michael
      McGrane, Vice President, General Counsel & Secretary
$25,500
12,435
David
      L. Weinberg, Vice President & Chief Financial Officer
$15,000
7,315
*
Effective December 31, 2004, Mr. Apostolakis' role as Vice President, Investor
Relations, was terminated, making him ineligible for an award under the
Plan.
**
Options were granted on February 25, 2005, under the Company's
1996 Long-term Performance Plan, vest immediately, and have an exercise
price of $2.05 per share, which is equal to the average of the high and low
price of the Company's Common Stock on February 25, 2005, on the Nasdaq National
Market.
A copy of
the Columbia Laboratories Inc. Incentive Plan, 2004, is attached as Exhibit 99.2
to this Form 8-K and is incorporated herein by reference.
Item
9.01
Financial
Statements and Exhibits
(c)
Exhibits.
99.1
Employment
Agreement by and between Columbia Laboratories, Inc., and Robert S. Mills dated
February 25, 2005.
99.2
Columbia
Laboratories Inc. Incentive Plan, 2004
SIGNATURE
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.
Date:
March 1, 2005
COLUMBIA
      LABORATORIES, INC.
By:
/S/ David L. Weinberg
David L. Weinberg
Vice President and Chief Financial
      Officer