Sec Form 13D Filing - ENGINE CAPITAL L.P. filing for PDL BIOPHARMA INC. (PDLI) - 2020-03-10

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)

(Amendment No. 2)¹

PDL BioPharma, Inc.

(Name of Issuer)

Common Stock, $0.01 par value

(Title of Class of Securities)

69329Y104

(CUSIP Number)

ANDREW FREEDMAN, ESQ.

RYAN NEBEL, ESQ.

OLSHAN FROME WOLOSKY LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

 

March 6, 2020

(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.

 

 

1              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).

	1		NAME OF REPORTING PERSON
				ENGINE CAPITAL, L.P.
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	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)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							2,563,854
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							2,563,854
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				2,563,854
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				2.2%
	14		TYPE OF REPORTING PERSON
				PN

  

1

NAME OF REPORTING PERSON

ENGINE JET CAPITAL, L.P.

2

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ☐

(b) ☐

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)

☐

6

CITIZENSHIP OR PLACE OF ORGANIZATION

DELAWARE

NUMBER OF

7

SOLE VOTING POWER

SHARES

BENEFICIALLY

574,716

OWNED BY

8

SHARED VOTING POWER

EACH

REPORTING

- 0 -

PERSON WITH

9

SOLE DISPOSITIVE POWER

574,716

10

SHARED DISPOSITIVE POWER

- 0 -

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

574,716

12

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

☐

13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

Less than 1%

14

TYPE OF REPORTING PERSON

PN

  

 

	1		NAME OF REPORTING PERSON
				ENGINE AIRFLOW CAPITAL, L.P.
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	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)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							1,381,424
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							1,381,424
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				1,381,424
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				1.2%
	14		TYPE OF REPORTING PERSON
				PN

  

 

	1		NAME OF REPORTING PERSON
				ENGINE CAPITAL MANAGEMENT, LP
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				OO
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							4,519,994
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							4,519,994
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				4,519,994
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				4.0%
	14		TYPE OF REPORTING PERSON
				PN

  

 

	1		NAME OF REPORTING PERSON
				ENGINE CAPITAL MANAGEMENT GP, LLC
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				OO
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							4,519,994
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							4,519,994
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				4,519,994
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
																			& #xA0;
				4.0%
	14		TYPE OF REPORTING PERSON
				OO

  

 

	1		NAME OF REPORTING PERSON
				ENGINE INVESTMENTS, LLC
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				OO
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							3,138,570
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							3,138,570
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				3,138,570
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				2.7%
	14		TYPE OF REPORTING PERSON
				OO

  

 

	1		NAME OF REPORTING PERSON
				ENGINE INVESTMENTS II, LLC
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				OO
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							1,381,424
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							1,381,424
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				1,381,424
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				1.2%
	14		TYPE OF REPORTING PERSON
				OO

  

 

	1		NAME OF REPORTING PERSON
				ARNAUD AJDLER
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				OO
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				BELGIUM
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							4,519,994
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							- 0 -
PERSON WITH				9		SOLE DISPOSITIVE POWER
							4,519,994
				10		SHARED DISPOSITIVE POWER
							- 0 -
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				4,519,994
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				4.0%
	14		TYPE OF REPORTING PERSON
				IN

  

The following constitutes Amendment No. 2 to the Schedule 13D filed by the undersigned (“Amendment No. 2”). This Amendment No. 2 amends the Schedule 13D as specifically set forth herein.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended and restated to read as follows:

The Shares purchased by each of Engine Capital, Engine Jet and Engine Airflow were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business). The aggregate purchase price of the 2,563,854 Shares beneficially owned by Engine Capital is approximately $6,255,386, including brokerage commissions. The aggregate purchase price of the 574,716 Shares beneficially owned by Engine Jet is approximately $1,399,778, including brokerage commissions. The aggregate purchase price of the 1,381,424 Shares beneficially owned by Engine Airflow is approximately $3,333,801, including brokerage commissions.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended to add the following:

The sale of Shares reported herein was undertaken to effectuate a rebalancing of the Reporting Persons’ portfolio in light of recent market volatility and the appreciation in the Issuer’s stock price since the Reporting Persons’ investment was made in the Issuer.

Item 5.

Interest in Securities of the Issuer.

Items 5(a) – (c) and (e) are hereby amended and restated to read as follows:

The aggregate percentage of Shares reported owned by each person named herein is based upon 114,184,610 Shares outstanding as of October 31, 2019, which is the total number of Shares outstanding as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 6, 2019.

A.

Engine Capital

(a)

As of the close of business on March 9, 2020, Engine Capital directly owned 2,563,854 Shares.

Percentage: Approximately 2.2%

(b)

1. Sole power to vote or direct vote: 2,563,854 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 2,563,854 4. Shared power to dispose or direct the disposition: 0

 

B.

Engine Jet

(a)

As of the close of business on March 9, 2020, Engine Jet directly owned 574,716 Shares.

Percentage: Less than 1%

(b)

1. Sole power to vote or direct vote: 574,716 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 574,716 4. Shared power to dispose or direct the disposition: 0

 

C.

Engine Airflow

(a)

As of the close of business on March 9, 2020, Engine Airflow directly owned 1,381,424 Shares.

Percentage: Approximately 1.2%

(b)

1. Sole power to vote or direct vote: 1,381,424 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 1,381,424 4. Shared power to dispose or direct the disposition: 0

 

D.

Engine Management

(a)

Engine Management, as the investment manager of each of Engine Capital, Engine Jet and Engine Airflow, may be deemed to beneficially own the 4,519,994 Shares owned in the aggregate by Engine Capital, Engine Jet and Engine Airflow.

Percentage: Approximately 4.0%

(b)

1. Sole power to vote or direct vote: 4,519,994 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 4,519,994 4. Shared power to dispose or direct the disposition: 0

 

E.

Engine GP

(a)

Engine GP, as the general partner of Engine Management, may be deemed to beneficially own the 4,519,994 Shares owned in the aggregate by Engine Capital, Engine Jet and Engine Airflow.

Percentage: Approximately 4.0%

(b)

1. Sole power to vote or direct vote: 4,519,994 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 4,519,994 4. Shared power to dispose or direct the disposition: 0

F.

Engine Investments

(a)

Engine Investments, as the general partner of each of Engine Capital and Engine Jet, may be deemed to beneficially own the 3,138,570 Shares owned in the aggregate by Engine Capital and Engine Jet.

Percentage: Approximately 2.7%

(b)

1. Sole power to vote or direct vote: 3,138,570 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 3,138,570 4. Shared power to dispose or direct the disposition: 0

G.

Engine Investments II

(a)

Engine Investments II, as the general partner of Engine Airflow may be deemed to beneficially own the 1,381,424 Shares owned by Engine Airflow.

Percentage: Approximately 1.2%

(b)

1. Sole power to vote or direct vote: 1,381,424 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 1,381,424 4. Shared power to dispose or direct the disposition: 0

 

H.

Arnaud Ajdler

(a)

Mr. Ajdler, as the managing partner of Engine Management and the managing member of each of Engine GP, Engine Investments and Engine Investments II, may be deemed to beneficially own the 4,519,994 Shares owned in the aggregate by Engine Capital, Engine Jet and Engine Airflow.

Percentage: Approximately 4.0%

(b)

1. Sole power to vote or direct vote: 4,519,994 2. Shared power to vote or direct vote: 0 3. Sole power to dispose or direct the disposition: 4,519,994 4. Shared power to dispose or direct the disposition: 0

Each Reporting Person may be deemed to be a member of a “group” with the other Reporting Persons for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and such group may be deemed the beneficial owner of the Shares directly owned by each of the Reporting Persons. The filing of this Amendment No. 2 to the Schedule 13D shall not be deemed an admission that the Reporting Persons are, for purposes of Section 13(d) of the Exchange Act, the beneficial owners of any securities of the Issuer that he or it does not directly own. Each of the Reporting Persons specifically disclaims beneficial ownership of the securities reported herein that he or it does not directly own.

(c)

The transactions in the Shares by the Reporting Persons since the filing of Amendment No. 1 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference. Such transactions were effected in the open market.

(e)

As of March 2, 2020, the Reporting Persons ceased to be the beneficial owners of more than 5% of the Shares of the Issuer.

 

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.

Dated: March 10, 2020

 

	Engine Capital, L.P.
	By: Engine Investments, LLC,        General Partner
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Jet Capital, L.P.
	By: Engine Investments, LLC,        General Partner
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Airflow Capital, L.P.
	By: Engine Investments II, LLC,        General Partner
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Capital Management, LP
	By: Engine Capital Management GP, LLC,        General Partner
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Capital Management GP, LLC
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Investments, LLC
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	Engine Investments II, LLC
	By:	/s/ Arnaud Ajdler
		Name:	Arnaud Ajdler
		Title:	Managing Member

 

 

	/s/ Arnaud Ajdler
	ARNAUD AJDLER

 

SCHEDULE A

Transactions in the Shares Since the Filing of Amendment No. 1 to the Schedule 13D

Nature of Transaction

Securities Purchased/(Sold)

Price Per Share($)

Date of Purchase/Sale

 

ENGINE CAPITAL, L.P.

Sale of Common Stock	(98,075)	3.3823	02/28/20
Sale of Common Stock	(123,595)	3.3778	02/28/20
Sale of Common Stock	(60,860)	3.5381	03/02/20
Sale of Common Stock	(144,195)	3.5446	03/02/20
Sale of Common Stock	(91,016)	3.5093	03/03/20
Sale of Common Stock	(346,067)	3.5048	03/03/20
Sale of Common Stock	(74,157)	3.5000	03/04/20
Sale of Common Stock	(453,183)	3.4511	03/06/20
Sale of Common Stock	(14,419)	3.3501	03/09/20

 

Engine Jet Capital, L.P.

Sale of Common Stock	(20,952)	3.3823	02/28/20
Sale of Common Stock	(26,405)	3.3778	02/28/20
Sale of Common Stock	(13,002)	3.5381	03/02/20
Sale of Common Stock	(30,805)	3.5446	03/02/20
Sale of Common Stock	(19,444)	3.5093	03/03/20
Sale of Common Stock	(73,933)	3.5048	03/03/20
Sale of Common Stock	(15,843)	3.5000	03/04/20
Sale of Common Stock	(96,817)	3.4511	03/06/20
Sale of Common Stock	(3,081)	3.3501	03/09/20