Schedule 13D Amendment No. 2

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WOj7xBb5UqS5rKbIYjNlOdhKYBZrIwUcDnmgYio93Zs5SLNcX0VVoGv9SiyCOmgW /H+BfKf4yNbrActca9+t4w== 0001193125-06-184278.txt : 20060901 0001193125-06-184278.hdr.sgml : 20060901 20060901125832 ACCESSION NUMBER: 0001193125-06-184278 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20060901 DATE AS OF CHANGE: 20060901 GROUP MEMBERS: ARGERIS KARABELAS GROUP MEMBERS: CDC OPERATING LLC GROUP MEMBERS: DAVID R. RAMSAY GROUP MEMBERS: JAN LESCHLY SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: BIODELIVERY SCIENCES INTERNATIONAL INC CENTRAL INDEX KEY: 0001103021 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 352089858 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-57907 FILM NUMBER: 061070883 BUSINESS ADDRESS: STREET 1: 2501 AERIAL CENTER PARKWAY STREET 2: SUITE 205 CITY: MORRISVILLE STATE: NC ZIP: 27560 BUSINESS PHONE: 919-653-5160 MAIL ADDRESS: STREET 1: 2501 AERIAL CENTER PARKWAY STREET 2: SUITE 205 CITY: MORRISVILLE STATE: NC ZIP: 27560 FORMER COMPANY: FORMER CONFORMED NAME: MAS ACQUISITION XXIII CORP DATE OF NAME CHANGE: 20000111 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CDC IV LLC CENTRAL INDEX KEY: 0001365385 IRS NUMBER: 204153867 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 47 HULFISH STREET STREET 2: SUITE 310 CITY: PRINCETON STATE: NJ ZIP: 08542 BUSINESS PHONE: 609-683-8300 MAIL ADDRESS: STREET 1: 47 HULFISH STREET STREET 2: SUITE 310 CITY: PRINCETON STATE: NJ ZIP: 08542 SC 13D/A 1 dsc13da.htm SCHEDULE 13D AMENDMENT NO. 2 Schedule 13D Amendment No. 2


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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 2)¹

BIODELIVERY SCIENCES INTERNATIONAL, INC.

(Name of Issuer)

Common Stock, $0.001 par value per share

(Title of Class of Securities)

09060J106

(CUSIP Number)

David R. Ramsay

CDC IV, LLC

47 Hulfish Street, Suite 310

Princeton, New Jersey 08542

609-683-8300

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

August 30, 2006

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).


CUSIP No. 09060J106		13D		Page 2 of 10 Pages


1	NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

	CDC IV, LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS* (SEE INSTRUCTIONS)

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	State of Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		0
		8 SHARED VOTING POWER

		3,541,120
		9 SOLE DISPOSITIVE POWER

		0
		10 SHARED DISPOSITIVE POWER

		3,541,120


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	3,541,120 shares of common stock comprised of: (i) a warrant to purchase 601,120 shares of the Issuer’s common stock, issued in February 2006; and (ii) 2,000,000 shares of the Issuer’s common stock and a warrant to purchase 940,000 shares of the Issuer’s common stock, issued in May, 2006.
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)*	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	26.3%
14	TYPE OF REPORTING PERSON*

	OO


CUSIP No. 09060J106		13D		Page 3 of 10 Pages


1	NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

	CDC Operating LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS* (SEE INSTRUCTIONS)

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	State of Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		0
		8 SHARED VOTING POWER

		3,541,120
		9 SOLE DISPOSITIVE POWER

		0
		10 SHARED DISPOSITIVE POWER

		3,541,120


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	3,541,120 shares of common stock comprised of: (i) a warrant to purchase 601,120 shares of the Issuer’s common stock, issued in February 2006; and (ii) 2,000,000 shares of the Issuer’s common stock and a warrant to purchase 940,000 shares of the Issuer’s common stock, issued in May, 2006.
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)*	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	26.3%
14	TYPE OF REPORTING PERSON*

	OO


CUSIP No. 09060J106		13D		Page 4 of 10 Pages


1	NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

	David R. Ramsay
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS* (SEE INSTRUCTIONS)

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	United States of America


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		0
		8 SHARED VOTING POWER

		3,541,120
		9 SOLE DISPOSITIVE POWER

		0
		10 SHARED DISPOSITIVE POWER

		3,541,120


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	3,541,120 shares of common stock comprised of: (i) a warrant to purchase 601,120 shares of the Issuer’s common stock, issued in February 2006; and (ii) 2,000,000 shares of the Issuer’s common stock and a warrant to purchase 940,000 shares of the Issuer’s common stock, issued in May, 2006.
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)*	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	26.3%
14	TYPE OF REPORTING PERSON*

	IN


CUSIP No. 09060J106		13D		Page 5 of 10 Pages


1	NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

	Argeris Karabelas
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS* (SEE INSTRUCTIONS)

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	United States of America


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		0
		8 SHARED VOTING POWER

		3,541,120
		9 SOLE DISPOSITIVE POWER

		0
		10 SHARED DISPOSITIVE POWER

		3,541,120


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	3,541,120 shares of common stock comprised of: (i) a warrant to purchase 601,120 shares of the Issuer’s common stock, issued in February 2006; and (ii) 2,000,000 shares of the Issuer’s common stock and a warrant to purchase 940,000 shares of the Issuer’s common stock, issued in May, 2006.
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)*	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	26.3%
14	TYPE OF REPORTING PERSON*

	IN


CUSIP No. 09060J106		13D		Page 6 of 10 Pages


1	NAMES OF REPORTING PERSONS. I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

	Jan Leschly
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
	(a) ¨
	(b) ¨
3	SEC USE ONLY

4	SOURCE OF FUNDS* (SEE INSTRUCTIONS)

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)	¨


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	United States of America


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7 SOLE VOTING POWER

		0
		8 SHARED VOTING POWER

		3,541,120
		9 SOLE DISPOSITIVE POWER

		0
		10 SHARED DISPOSITIVE POWER

		3,541,120


11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	3,541,120 shares of common stock comprised of: (i) a warrant to purchase 601,120 shares of the Issuer’s common stock, issued in February 2006; and (ii) 2,000,000 shares of the Issuer’s common stock and a warrant to purchase 940,000 shares of the Issuer’s common stock, issued in May, 2006.
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)*	¨


13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	26.3%
14	TYPE OF REPORTING PERSON*

	IN

EXPLANATORY NOTE

This Amendment No. 2 to the Schedule 13D amends and supplements Items 4 and 7 of the Schedule 13D, filed June 12, 2006, by CDC IV, LLC, a Delaware limited liability company (“CDC IV”) relating to the Common Stock, $0.001 par value per share, of BioDelivery Sciences International, Inc., a Delaware corporation (the “Issuer”) and Amendment No. 1 to the Schedule 13D, filed August 22, 2006, by CDC IV relating to the Common Stock, $0.001 par value per share, of Issuer.

Item 4. Purpose of Transaction

On August 30, 2006, CDC IV sent Issuer a Notice of Breach and Termination (the “Notice”) advising Issuer of several material breaches by Issuer under the Clinical Development and License Agreement, dated as of July 14, 2005, among the Issuer, CDC IV, as successor in interest to Clinical Development Capital LLC, and Arius Pharmaceuticals, Inc., as amended (the “CDLA”), and advising Issuer of CDC IV’s termination of the CDLA. A copy of this Notice is attached hereto as Exhibit G.

Additionally, CDC IV sent a letter to the members of Issuer’s Board of Directors (the “Letter”) expressing CDC IV’s continued belief in the potential of Issuer’s BEMA™ Fentanyl product and, despite CDC IV’s dissatisfaction with current operations and management and Issuers material breaches under the CDLA, CDC IV’s willingness to provide further funding for such development, subject to a change in management. A copy of this Letter is attached hereto as Exhibit H.

Item 7. Material to Be Filed as Exhibits


Exhibit		Name
G		Notice of Breach and Termination, dated as of August 30, 2006, from CDC IV, LLC to BioDelivery Sciences International, Inc.

H		Letter from CDC IV, LLC to the Members of the Board of Directors of BioDelivery Sciences International, Inc., dated as of August 30, 2006

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. The undersigned hereby express our agreement that this Schedule 13D/A is filed on behalf of each of us pursuant to Rule 13d-1(k) under the Securities Exchange Act.


Dated: September 1, 2006	CDC IV, LLC

	By:	/s/ David R. Ramsay
	Name:	David R. Ramsay
	Title:	Authorized Signatory

Dated: September 1, 2006	CDC OPERATING LLC

	By:	/s/ David R. Ramsay
	Name:	David R. Ramsay
	Title:	Authorized Signatory

Dated: September 1, 2006	/s/ David R. Ramsay
	David R. Ramsay

Dated: September 1, 2006	/s/ Argeris Karabelas
	Argeris Karabelas

Dated: September 1, 2006	/s/ Jan Leschly
	Jan Leschly

Attention: Intentional misstatements or omissions of fact constitute Federal criminal violations

(See 18 U.S.C. 1001)

EX-99.(G) 2 dex99g.htm NOTICE OF BREACH AND TERMINATION, DATED AS OF AUGUST 30, 2006 Notice of Breach and Termination, dated as of August 30, 2006

Exhibit G

NOTICE OF BREACH AND TERMINATION

We make reference to the Clinical Development and License Agreement dated as of July 14, 2005 among BioDelivery Sciences International, Inc. (“BDSI”), Clinical Development Capital LLC (together with its successors and assigns, “CDC”), and Arius Pharmaceuticals, Inc. (such agreement, as amended, the “CDLA”).

CDC hereby gives notice to BDSI that (i) BDSI is in material breach of the CDLA and (ii) CDC is terminating the CDLA pursuant to Section 10.2 of the CDLA. BDSI’s breaches are not curable, such that the termination of the CDLA is effective immediately. If one or more of these breaches are subject to cure, then this Notice of Breach and Termination (“Notice”) also serves as a notice for purposes of starting any applicable cure period under the CDLA.

The natures of BDSI’s defaults are as follows:

On August 15 2006, BDSI submitted to the United States Food and Drug Administration (“FDA”), without CDC’s approval, an amended agenda that changed the protocols and end-point of the clinical trials in violation of, inter alia, Sections 2.1 and 2.3 of the CDLA.

On July 26, 2006, BDSI was notified by the Research Advisory Panel of California that BDSI had failed to comply with applicable laws and protocols in obtaining informed patient consents, which failures are in violation of, inter alia, Sections 4.1 and 4.5 of the CDLA.

BDSI failed until August 22, 2006 to notify CDC of the failures to comply identified in item 2 above, in violation of, inter alia, Section 4.5 of the CDLA.

CDC hereby demands that BDSI immediately comply with its obligations under Section 10.5 of the CDLA, including its obligations to transfer the specified assets and rights to CDC. CDC reserves all its rights and remedies against BDSI and its officers and directors, including with respect to breaches not enumerated.


CDC IV, LLC, As successor and assign of Clinical Development Capital LLC

By:		/s/ David R.Ramsay
Name:		David R.Ramsay
Title:		Authorized Signatory

EX-99.(H) 3 dex99h.htm LETTER FROM CDC IV, LLC Letter from CDC IV, LLC

Exhibit H

August 30, 2006

The Board of Directors

BioDelivery Sciences International, Inc.

2501 Aerial Center Parkway, Suite 205

Morrisville, NC 27560

Dear Directors:

We again write to you regarding the current state of affairs at BioDelivery Sciences International, Inc. (“BDSI” or the “Company”). As you are well aware, we have voiced our serious concerns over the Company’s operations and development plan on multiple occasions to Chairman Frank O’Donnell and in correspondence to you and management.

We have attempted to work cooperatively with the Board and the management of the Company. However, BDSI has failed to comply with its legal obligations under the Clinical Development and License Agreement, dated as of July 14, 2005 (as amended, the “CDLA”). As such, simultaneous with this letter we are delivering to the Company a Notice of Breach and Termination (the “Notice”) citing various material breaches by BDSI under the CDLA.

It is regrettable that our efforts to work with the Company have been rejected, as we continue to believe in the potential of the BEMA Fentanyl product. Even now, if we were able to agree on mutually acceptable terms (which would necessarily include a change in the current CEO of the Company), we would still be prepared to offer $5 million of financing to BDSI. Should the Laurus Master Fund, Ltd. (“Laurus”) choose to accelerate its currently outstanding debt in response to the Notice, we would permit a portion of that $5 million in financing to be used to take out the Laurus debt if we could take over its position on the same terms as Laurus’ current agreement.

As you know, we are required under our consent from QLT, Inc. to inform it of the Notice. We will also be complying with our obligations under Section 13d of the Securities Exchange Act of 1934 and Rule 13d-2 promulgated thereunder.

Sincerely,

/s/ David R. Ramsay

David R. Ramsay

Authorized Signatory of CDC IV, LLC

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