-----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, S/AblSpXBh1wV2WmHnQff9gVJiTCA/k9G5h+mm43Y+GNXe7HyoZhM/KETDNQPa1W IJWFhsJWzzF/le76FsvltQ== 0001104659-11-009742.txt : 20110224 0001104659-11-009742.hdr.sgml : 20110224 20110224155636 ACCESSION NUMBER: 0001104659-11-009742 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20110224 DATE AS OF CHANGE: 20110224 GROUP MEMBERS: BRADLEY P. BAUER GROUP MEMBERS: CAROL B. BAUER GROUP MEMBERS: GEORGE P. BAUER GROUP MEMBERS: GUY SHANON GROUP MEMBERS: KINGSTOWN CAPITAL MANAGEMENT L.P. GROUP MEMBERS: KINGSTOWN MANAGEMENT GP LLC GROUP MEMBERS: KINGSTOWN PARTNERS II, L.P. GROUP MEMBERS: KINGSTOWN PARTNERS MASTER LTD. GROUP MEMBERS: KTOWN, LP GROUP MEMBERS: MICHAEL BLITZER SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CPEX Pharmaceuticals, Inc. CENTRAL INDEX KEY: 0001418919 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 261172076 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-84092 FILM NUMBER: 11636222 BUSINESS ADDRESS: STREET 1: 2 HOLLAND WAY CITY: EXETER STATE: NH ZIP: 03833 BUSINESS PHONE: (603) 658-6100 MAIL ADDRESS: STREET 1: 2 HOLLAND WAY CITY: EXETER STATE: NH ZIP: 03833 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: KINGSTOWN CAPITAL PARTNERS, LLC CENTRAL INDEX KEY: 0001418673 IRS NUMBER: 743125312 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 535 MADISON AVENUE STREET 2: 30TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-319-1309 MAIL ADDRESS: STREET 1: 535 MADISON AVENUE STREET 2: 30TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D 1 a11-6564_1sc13d.htm SC 13D

 

 

UNITED STATES

 

 

SECURITIES AND EXCHANGE COMMISSION

 

 

Washington, D.C. 20549

 

 

 

 

 

SCHEDULE 13D

(Rule 13d-101)

 

 

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

 

CPEX Pharmaceuticals, Inc.

(Name of Issuer)

 

Common Stock, par value $0.01 per share

(Title of Class of Securities)

 

12620N104

(CUSIP Number)

 

Michael Blitzer

Kingstown Capital Partners, LLC

11 East 44th Street, 7th Floor

New York, NY 10017

(212)319-1309

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

 

February 17, 2010

(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. x (See explanatory note to this Schedule 13D)

 

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.   12620N104

 

 

1

Name of Reporting Person
KINGSTOWN PARTNERS MASTER LTD.

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
WC

 

 

5

Check box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
CAYMAN ISLANDS

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
139,214

 

8

Shared Voting Power
139,214

 

9

Sole Dispositive Power
139,214

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
139,214

 

 

12

Check box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
5.3%

 

 

14

Type of Reporting Person
CO

 

2



 

CUSIP No.   12620N104

 

 

1

Name of Reporting Person
KINGSTOWN PARTNERS II, L.P.

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
WC

 

 

5

Check box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
DELAWARE

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
13,357

 

8

Shared Voting Power
13,357

 

9

Sole Dispositive Power
13,357

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
13,357

 

 

12

Check box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
0.5%

 

 

14

Type of Reporting Person
PN

 

3



 

CUSIP No.   12620N104

 

 

1

Name of Reporting Person
KTOWN, LP

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
WC

 

 

5

Check box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
DELAWARE

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
6,585

 

8

Shared Voting Power
6,585

 

9

Sole Dispositive Power
6,585

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
6,585

 

 

12

Check box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
0.3%

 

 

14

Type of Reporting Person
PN

 

4



 

CUSIP No.   12620N104

 

 

1

Name of Reporting Person
KINGSTOWN CAPITAL PARTNERS, LLC

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
AF

 

 

5

Check box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
DELAWARE

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
159,156

 

8

Shared Voting Power
159,156

 

9

Sole Dispositive Power
159,156

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
159,156

 

 

12

Check box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.1%

 

 

14

Type of Reporting Person
OO

 

5



 

CUSIP No. 12620N104

 

 

1

Name of Reporting Person
KINGSTOWN CAPITAL MANAGEMENT L.P.

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds

AF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
DELAWARE

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
159,156

 

8

Shared Voting Power
159,156

 

9

Sole Dispositive Power
159,156

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
159,156

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares  o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.1%

 

 

14

Type of Reporting Person
PN

 

6



 

 

 

CUSIP No. 12620N104

 

 

1

Name of Reporting Person
KINGSTOWN MANAGEMENT GP LLC

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
AF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
DELAWARE

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
159,156

 

8

Shared Voting Power
159,156

 

9

Sole Dispositive Power
159,156

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
159,156

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares  o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.1%

 

 

14

Type of Reporting Person
OO

 

7



 

 

CUSIP No. 12620N104

 

 

1

Name of Reporting Person
MICHAEL BLITZER

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
AF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
USA

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
159,156

 

8

Shared Voting Power
159,156

 

9

Sole Dispositive Power
159,156

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
159,156

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares  o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.1%

 

 

14

Type of Reporting Person
IN

 

8



 

 

CUSIP No. 12620N104

 

 

1

Name of Reporting Person
GUY SHANON

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
AF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
USA

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
159,156

 

8

Shared Voting Power
159,156

 

9

Sole Dispositive Power
159,156

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
159,156

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares  o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.1%

 

 

14

Type of Reporting Person
IN

 

9



 

 

CUSIP No. 12620N104

 

 

1

Name of Reporting Person
GEORGE P. BAUER

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 x

 

 

(b)

 o

 

 

3

SEC Use Only

 

 

4

Source of Funds
PF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
USA

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
- 0 -

 

8

Shared Voting Power
164,372

 

9

Sole Dispositive Power
- 0 -

 

10

Shared Dispositive Power
5,216

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
164,372

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares  o

 

 

13

Percent of Class Represented by Amount in Row (11)
6.3%

 

 

14

Type of Reporting Person
IN

 

10



 

CUSIP No.   12620N104

 

 

1

Name of Reporting Person
CAROL B. BAUER

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 o

 

 

(b)

x

 

 

3

SEC Use Only

 

 

4

Source of Funds
PF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
USA

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
- 0 -

 

8

Shared Voting Power
5,216

 

9

Sole Dispositive Power
- 0 -

 

10

Shared Dispositive Power
5,216

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
5,216

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
0.2%

 

 

14

Type of Reporting Person
IN

 

11



 

CUSIP No.   12620N104

 

 

1

Name of Reporting Person
BRADLEY P. BAUER

 

 

2

Check the Appropriate Box if a Member of a Group

 

 

(a)

 o

 

 

(b)

x

 

 

3

SEC Use Only

 

 

4

Source of Funds
PF

 

 

5

Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Item 2(d) or 2(e)     o

 

 

6

Citizenship or Place of Organization
USA

 

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

7

Sole Voting Power
- 0 -

 

8

Shared Voting Power
- 0 -

 

9

Sole Dispositive Power
- 0 -

 

10

Shared Dispositive Power
- 0 -

 

 

11

Aggregate Amount Beneficially Owned by Each Reporting Person
- 0 -

 

 

12

Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares   o

 

 

13

Percent of Class Represented by Amount in Row (11)
0%

 

 

14

Type of Reporting Person
IN

 

12



 

CUSIP No.   12620N104

 

EXPLANATORY NOTE

 

Certain of the shares of the Common Stock, par value $0.01 per share (“Shares”) of CPEX Pharmaceuticals, Inc. (the “Issuer”) to which this Schedule 13D relates were previously reported by George P. Bauer, Carol B. Bauer and Bradley P. Bauer on Schedule 13G, the last amendment of which was filed on February 14, 2011.  This Schedule 13D shall be deemed to be a conversion of the Schedule 13G set forth above pursuant to Rule 13d-1(e) under the Exchange Act.

 

Item 1.                            Security and Issuer.

 

This statement relates to the Shares of the Issuer.  The address of the principal executive offices of the Issuer is 2 Holland Way, Exeter, New Hampshire 03833.

 

Item 2.                            Identity and Background.

 

(a)           This statement is filed by Kingstown Capital Management L.P., a Delaware limited partnership (“Kingstown Capital”), Kingstown Management GP LLC, a Delaware limited liability company (“Kingstown Management”), Kingstown Capital Partners, LLC, a Delaware limited liability company (“General Partner”), Kingstown Partners Master Ltd., a Cayman Islands corporation (“Master Fund”), Kingstown Partners II, L.P. a Delaware limited partnership (“Fund II”), Ktown, LP a Delaware limited partnership (“Ktown,” and together with Master Fund and Fund II, the “Funds”), Michael Blitzer, Guy Shanon, George P. Bauer, Carol B. Bauer and Bradley P. Bauer.  Each of the foregoing is referred to as a “Reporting Person” and collectively as the “Reporting Persons. 48;  Kingstown Capital, Kingstown Management, General Partner, the Funds, Michael Blitzer and Guy Shanon are collectively referred to as the “Kingstown Reporting Persons”.  George P. Bauer, Carol B. Bauer and Bradley P. Bauer are collectively referred to as the “Bauer Reporting Persons”.  Each of the Reporting Persons is party to that certain Joint Filing Agreement as further described in Item 6.

 

General Partner is the general partner of each of the Funds.  Kingstown Capital is the investment manager of each of the Funds.  Kingstown Management is the general partner of Kingstown Capital.  Each of Mr. Blitzer and Mr. Shanon is a managing member of Kingstown Management.  By virtue of these relationships, each of Kingstown Capital, Kingstown Management, Mr. Blitzer and Mr. Shanon may be deemed to beneficially own the Shares owned by the Funds.  Accordingly, the Kingstown Reporting Persons are hereby filing a joint Schedule 13D.

 

(b)           The principal business address of each of Kingstown Capital, Kingstown Management, Fund II, Ktown, Michael Blitzer and Guy Shanon is 11 East 44th Street, 7th Floor, New York, New York 10017.  The principal business address of Master Fund is c/o Mourant Ozannes Corporate Services, 42 North Church Street, P.O. Box 1348, Grand Cayman KY1-1208, Cayman Islands.  The officers and directors of Master Fund and their principal occupations and business addresses are set forth on Schedule A and incorporated by reference in this Item 2.  The residence address of George P. Bauer and Carol B. Bauer is 206 Dudley Road, Wilton, CT 06897.  The residence address of Bradley P. Bauer is  S6553 Spring Valley Road, Loganville, WI 53943.

 

(c)           The principal business of each of the Funds is acquiring, holding and disposing of investments in various companies.  The principal business of Kingstown Capital is acting as the investment manager of Master Fund.  The principal business of Kingstown Management is acting as the general partner of Kingstown Capital.  The principal occupation of each of Mr. Blitzer and Mr. Shanon is acting as a managing member of Kingstown Management.  The principal occupations of Mr. George P. Bauer, Ms. Bauer and Mr. Bradley P. Bauer are private investor, homemaker and student, respectively.

 

13



 

(d)           No Reporting Person, nor any person listed on Schedule A annexed hereto, has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(e)           No Reporting Person, nor any person listed on Schedule A annexed hereto, has, during the last five years, been party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

 

(f)           Mr. Blitzer, Mr. Shanon, Mr. George P. Bauer, Ms. Bauer and Mr. Bradley P. Bauer are citizens of the United States of America.

 

Item 3.                            Source and Amount of Funds or Other Consideration.

 

The aggregate purchase price of the 139,214 Shares owned by Master Fund is approximately $3,758,778.00.  The aggregate purchase price of the 13,357 Shares owned by Fund II is approximately $360,639.00.  The aggregate purchase price of the 6,585 Shares owned by Master Fund is approximately $177,795.00.  The aggregate purchase price of the 5,216 Shares owned by Ms. Bauer is $73,806.40, including brokerage commissions, acquired using her personal funds.

 

Item 4.                            Purpose of Transaction.

 

On January 3, 2011, the Issuer entered into a merger agreement with FCB I Holdings Inc. (“FCB I”) and FCB I Acquisition Corp. (“Merger Sub”), a wholly-owned subsidiary of FCB I (the “Merger Agreement”), pursuant to which Merger Sub would merge with and into the Issuer (the “Merger”).  The Issuer has called a special meeting of stockholders for the purpose of voting on a proposal to adopt and approve the Merger Agreement.  The Issuer’s board of directors has fixed the close of business on February 1, 2011, as the record date for determining stockholders entitled to notice of and to vote at the special meeting (the “Special Meeting”).  If stockholders representing at least a majority of the outstanding shares of the Issuer’s common stock adopt and approve the Merger Agreement and the Merger is completed, the Issu er would become a wholly-owned subsidiary of FCB I, and each outstanding share of common stock would be entitled to receive $27.25 in cash, without interest and less any applicable withholding taxes, for each share of the Issuer’s common stock held by it (the “Offer Price”).

 

On February 23, 2011, the Kingstown Reporting Persons acquired all of the Shares now owned by them (the “Kingstown Shares”) from George P. Bauer.  In connection with that transaction, Mr. Bauer agreed to vote the Kingstown Shares as directed by Kingstown Management, as described in Item 6.

 

The Reporting Persons do not currently believe that the Merger is in the best interest of the Issuer’s stockholders or that that the Offer Price fully values the Kingstown Shares.  Accordingly, the Kingstown Reporting Persons currently intend to direct George P. Bauer to vote the Kingstown Shares against the adoption of the Merger Agreement and the Bauer Reporting Persons currently intend to vote the their Shares against the adoption of the Merger Agreement.

 

The Reporting Persons purchased the Shares based on the Reporting Persons’ belief that the Shares, when purchased, were undervalued and represented an attractive investment opportunity.  Depending upon overall market conditions, other investment opportunities available to the Reporting Persons, and the availability of Shares at prices that would make the purchase or sale of Shares desirable, the Reporting Persons may endeavor to increase or decrease their position in the Issuer through, among other things, the purchase or sale of Shares on the open market or in private transactions or otherwise, on such terms and at such times as the Reporting Persons may deem advisable.

 

No Reporting Person and, to the best of the Reporting Persons’ knowledge, none of the persons listed on Schedule A, who are not also Reporting Persons, has any present plan or proposal which

 

14



 

would relate to or result in any of the matters set forth in subparagraphs (a) - (j) of Item 4 of Schedule 13D except as set forth herein or such as would occur upon completion of any of the actions discussed herein.  The Reporting Persons intend to review their investment in the Issuer on a continuing basis.  Depending on various factors including, without limitation, the Issuer’s financial position and investment strategy, the price levels of the Shares, conditions in the securities markets and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, communications with management and the Board of the Issuer regarding, among other things, the strategic direction and capital allocation of the Issuer, engaging in discussions with thi rd parties, including other stockholders of the Issuer, about the Issuer and the Reporting Persons’ investment, making proposals to the Issuer concerning changes to the capitalization, ownership structure, board structure (including seeking board representation) or operations of the Issuer, purchasing additional Shares, selling some or all of their Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares, or changing their intention with respect to any and all matters referred to in Item 4.

 

Item 5.                            Interest in Securities of the Issuer.

 

(a)           The aggregate percentage of Shares reported owned by each person named herein is based upon 2,616,936 Shares outstanding, which is the total number of Shares outstanding as of January 31, 2011, as reported in the Issuer’s Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on February 4, 2011.

 

As of the close of business on February 23, 2011, Master Fund owned directly 139,214 Shares, constituting approximately 5.3% of the Shares outstanding, Fund II owned directly 13,357 Shares, constituting approximately 0.5% of the Shares outstanding and Ktown owned directly 6,585 Shares, constituting approximately 0.3% of the Shares outstanding.  By virtue of their respective relationships with the Funds discussed in further detail in Item 2, each of Kingstown Capital, Kingstown Management, General Partner and Messrs. Blitzer and Shanon may be deemed to beneficially own the Shares owned directly by the Funds.

 

As of the close of business on February 23, 2011, Carol B. Bauer owned directly in her brokerage account 5,216 Shares, constituting approximately 0.2% of the Shares outstanding.

 

(b)           Each of Master Fund, General Partner, Kingstown Capital, Kingstown Management, Mr. Blitzer and Mr. Shanon have shared voting and dispositive power over the Shares owned directly by Master Fund.  Each of Fund II, General Partner, Kingstown Capital, Kingstown Management, Mr. Blitzer and Mr. Shanon have shared voting and dispositive power over the Shares owned directly by Fund II.  Each of Ktown, General Partner, Kingstown Capital, Kingstown Management, Mr. Blitzer and Mr. Shanon have shared voting and dispositive power over the Shares owned directly by Ktown.

 

George P. Bauer has shared control over the brokerage accounts of Carol B. Bauer and Bradley P. Bauer, including shared voting and dispositive power over the Shares held therein.  George P. Bauer disclaims beneficial ownership of the Shares reported herein except to the extent of his pecuniary interest therein.

 

(c)           Schedule B annexed hereto lists all transactions in securities of the Issuer during the past 60 days by the Reporting Persons.

 

(d)           No person other than the Reporting Persons is known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Shares.

 

(e)           Not applicable.

 

15



 

Item 6.                    Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

 

On February 24, 2011, the Reporting Persons entered into a Joint Filing Agreement (the “Joint Filing Agreement”), in which the Reporting Persons agreed to the joint filing on behalf of each of them of statements on Schedule 13D with respect to the securities of the Issuer to the extent required by applicable law.  The Joint Filing Agreement is attached as Exhibit 99.1 hereto and is incorporated herein by reference.

 

On February 22, 2011, in connection with the sale of the Kingstown Shares by George P. Bauer to Kingstown Reporting Persons, Mr. Bauer agreed to timely vote the Kingstown Shares (or consent in any action by written consent of stockholders in lieu of a meeting) in connection with the special meeting of stockholders and otherwise in the manner directed by Kingstown Management.

 

To the best of the Reporting Persons’ knowledge, none of the persons listed on Schedule A, who are not also Reporting Persons, is a party to any contract, agreement or understanding required to be disclosed herein.

 

Item 7.                    Material to be Filed as Exhibits.

 

99.1

Joint Filing Agreement, dated February 24, 2011, by and among Kingstown Capital Management L.P., Kingstown Management GP LLC, Kingstown Capital Partners, LLC, Kingstown Partners Master Ltd., Kingstown Partners II, L.P., Ktown, LP, Michael Blitzer, Guy Shanon, George P. Bauer, Carol B. Bauer and Bradley P. Bauer.

99.2

Letter agreement, dated February 22, 2010, by and between Kingstown Capital Partners, LLC and George P. Bauer.

 

16



 

CUSIP No.  12620N104

 

SIGNATURES

 

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

 

Date: February 24, 2011

KINGSTOWN CAPITAL MANAGEMENT L.P.

 

 

 

 

 

 

 

By:

Kingstown Management GP LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN MANAGEMENT GP LLC

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN CAPITAL PARTNERS, LLC

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN PARTNERS MASTER LTD.

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Director

 

 

 

 

 

 

 

KINGSTOWN PARTNERS II, L.P.

 

 

 

 

 

 

 

By:

Kingstown Capital Partners LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

17



 

 

KTOWN, LP

 

 

 

 

 

 

 

By:

Kingstown Capital Partners, LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

/s/ Michael Blitzer

 

MICHAEL BLITZER

 

 

 

 

 

/s/ Guy Shanon

 

GUY SHANON

 

 

 

 

 

/s/ George P. Bauer

 

GEORGE P. BAUER

 

 

 

 

 

/s/ Carol B. Bauer

 

CAROL B. BAUER

 

 

 

 

 

/s/ Bradley P. Bauer

 

BRADLEY P. BAUER

 

18



 

CUSIP No.  12620N104

 

SCHEDULE A

 

Directors and Officers of Kingstown Partners Master Ltd.

 

Name and Position

 

Principal Occupation

 

Principal Business Address

 

Citizenship

 

 

 

 

 

 

 

Michael Blitzer

Director

 

Managing Member,

Kingstown Management GP LLC

 

11 East 44th Street, 7th Floor,

New York, New York 10017

 

United States

 

 

 

 

 

 

 

Guy Shanon

Director

 

Managing Member,

Kingstown Management GP LLC

 

11 East 44th Street, 7th Floor,

New York, New York 10017

 

United States

 

 

 

 

 

 

 

Warren Keens

Director

 

Director of Close Brothers (Cayman) Limited

and Managing Director of Close Fund Services

 

Harbour Place, 4th Floor

103 South Church Street

Grand Cayman, Cayman Islands

 

United Kingdom

 

19



 

CUSIP No.  12620N104

 

SCHEDULE B

 

Transactions in the Shares by the Reporting Persons During the Past 60 Days

 

Transaction Date

 

Shares of Common Stock
Purchased (Sold)

 

Price Per
Share ($)

 

 

 

 

 

 

 

KINGSTOWN PARTNERS MASTER LTD.

 

 

 

 

 

 

2/17/2011

 

139,214

 

$

27.00

 

 

 

 

 

 

 

KINGSTOWN PARTNERS II, L.P.

 

 

 

 

 

 

2/17/2011

 

13,357

 

$

27.00

 

 

 

 

 

 

 

KTOWN, LP

 

 

 

 

 

 

2/17/2011

 

6,585

 

$

27.00

 

 

 

 

 

 

 

GEORGE P. BAUER

 

 

 

 

 

 

2/18/2011

 

(100

)

$

27.05

 

2/17/2011

 

(159,156

)

$

27.00

 

2/3/2011

 

(9,715

)

$

26.93

 

 

 

 

 

 

 

CAROL B. BAUER

 

 

 

 

 

 

2/3/2011

 

(5,000

)

$

26.93

 

 

 

 

 

 

 

BRADLEY P. BAUER

 

 

 

 

 

 

2/17/2011

 

(1,145

)

$

28.00

 

2/7/2011

 

(125

)

$

26.70

 

2/4/2011

 

(9,830

)

$

26.95

 

 

20


EX-99.1 2 a11-6564_1ex99d1.htm EX-99.1

Exhibit 99.1

 

JOINT FILING AGREEMENT

 

In accordance with Rule 13d-1(k)(1)(iii) under the Securities Exchange Act of 1934, as amended, the persons named below agree to the joint filing on behalf of each of them of a Statement on Schedule 13D (including additional amendments thereto) with respect to the shares of Common Shares, without par value, of CPEX Pharmaceuticals, Inc.  This Joint Filing Agreement shall be filed as an Exhibit to such Statement.

 

 

Date: February 24, 2011

KINGSTOWN CAPITAL MANAGEMENT L.P.

 

 

 

 

 

 

 

By:

Kingstown Management GP LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN MANAGEMENT GP LLC

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN PARTNERS MASTER LTD.

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Director

 

 

 

 

 

 

 

KINGSTOWN CAPITAL PARTNERS, LLC

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

KINGSTOWN PARTNERS II, L.P.

 

 

 

 

 

 

 

By:

Kingstown Capital Partners LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 



 

 

KTOWN, LP

 

 

 

 

 

 

 

By:

Kingstown Capital Partners, LLC

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

Managing Member

 

 

 

 

 

 

 

/s/ Michael Blitzer

 

MICHAEL BLITZER

 

 

 

 

 

 

 

/s/ Guy Shanon

 

GUY SHANON

 

 

 

 

 

 

 

/s/ George P. Bauer

 

GEORGE P. BAUER

 

 

 

 

 

 

 

/s/ Carol B. Bauer

 

CAROL B. BAUER

 

 

 

 

 

 

 

/s/ Bradley P. Bauer

 

BRADLEY P. BAUER

 


EX-99.2 3 a11-6564_1ex99d2.htm EX-99.2

Exhibit 99.2

 

George P. Bauer

206 Dudley Road

Wilton, CT 06897

 

February 22, 2011

 

Kingstown Capital Partners, LLC

11 East 44th Street, 7th Floor

New York, NY 10017

 

To Whom It May Concern:

 

This letter serves as an agreement and trade confirmation for the sale by the undersigned of shares of CPEX Pharmaceuticals, Inc. (the “Company”) common stock, par value $0.01 per share (the “Shares”) to Kingstown Capital Partners, LLC and its affiliates (to be allocated among them as determined by Kingstown Capital Partners, LLC in its sole and absolute discretion) (the “Buyer”), as follows:

 

Trade Date

 

Settlement
Date

 

Security

 

Quantity

 

Price /
Share

 

Total Price

 

2/17/2011

 

2/22/2011

 

CPEX

 

159,156

 

$

27.00

 

$

4,297,212.00

 

 

The undersigned hereby represents to the Buyer that the undersigned is the record and sole beneficial owners of the Shares free and clear of all encumbrances and has so owned the Shares at all times since (and including) February 1, 2011 and that the undersigned are entitled to vote the Shares at the special meeting of stockholders of the Company (the “Special Meeting”) currently scheduled to take place on March 24, 2011.

 

As a condition and material inducement to the purchase of the Shares by the Buyer, undersigned hereby agrees that he shall: (i) timely vote the Shares (or consent in any action by written consent of stockholders in lieu of a meeting) in connection with the Special Meeting and otherwise in the manner directed by the Buyer (as determined by the Buyer in its sole and absolute discretion); (ii) promptly provide to the Buyer copies of any written materials provided to the undersigned by or on behalf of the Company as a stockholder of the Company (including any materials relating to the Special Meeting) and (iii) provide the Buyer with reasonably satisfactory evidence that the Shares were voted (or consented) as provided in clause (i) above, as soon as is reasonably practicable.  The covenants contained in this paragraph are conditioned upon the payment by Buyer to the undersigned of the purc hase price for the Shares as described above.

 

The undersigned agrees to reasonably cooperate in connection with any filings requested under the federal securities laws in respect of the foregoing.

 



 

 

Best regards,

 

 

 

 

 

/s/ George P. Bauer

 

George P. Bauer

 

 

ACCEPTED AND AGREED:

 

KINGSTOWN CAPITAL PARTNERS, LLC

 

 

By:

/s/ Michael Blitzer

 

 

Michael Blitzer

 

Managing Member

 

2


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