Insider filing report for Changes in Beneficial Ownership
- Schedule 13G & 13D forms are used to report a party's ownership of stock which exceeds 5% of a company's total stock issue.
- Schedule 13G is a shorter version of Schedule 13D with fewer reporting requirements.
"Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise"
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- Peter Lynch
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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)
CNS
RESPONSE, INC.
(Name of
Issuer)
Common
Stock, par value $.001 per share
(Title of
Class of Securities)
12619C101
(CUSIP
Number)
George
Kallins, MD.
16
Deerwood Lane,
Newport
Beach, CA 92660
(949)
644 5817
(Name,
Address and Telephone Number of Person
Authorized
to Receive Notices and Communications)
November
3, 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.
o.
NOTE: Schedules filed
in paper format shall include a signed original and five copies of
the schedule, including all exhibits. See
Rule 13d-7 for other parties to whom copies are to be sent.
(Page 1
of 10)
* 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. 12619C101
| 1 | NAMES OF REPORTING PERSONS: BGN ACQUISITION LTD., LP |
||||||||||
| I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY): |
|||||||||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS): |
||||||||||
| (a) o | |||||||||||
| (b) o | |||||||||||
| 3 | SEC USE ONLY: | ||||||||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): | ||||||||||
| o | |||||||||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION: | ||||||||||
| CALIFORNIA | |||||||||||
| 7 | SOLE VOTING POWER: | ||||||||||
| NUMBER OF | 1,262,708 | ||||||||||
| SHARES | 8 | SHARED VOTING POWER: | |||||||||
| BENEFICIALLY | |||||||||||
| OWNED BY | 0 | ||||||||||
| EACH | 9 | SOLE DISPOSITIVE POWER: | |||||||||
| REPORTING | |||||||||||
| PERSON | 1,262,708 | ||||||||||
| WITH | 10 | SHARED DISPOSITIVE POWER: | |||||||||
| 0 | |||||||||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: | ||||||||||
| 1,262,708 | |||||||||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): | ||||||||||
| o | |||||||||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): | ||||||||||
| 2.2% | |||||||||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): | ||||||||||
| PN | |||||||||||
2
CUSIP NO. 12619C101
| 1 | NAMES OF REPORTING PERSONS: DEERWOOD HOLDINGS, LLC |
||||||||||
| I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY): |
|||||||||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS): |
||||||||||
| (a) o | |||||||||||
| (b) o | |||||||||||
| 3 | SEC USE ONLY: | ||||||||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): | ||||||||||
| o | |||||||||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION: | ||||||||||
| CALIFORNIA | |||||||||||
| 7 | SOLE VOTING POWER: | ||||||||||
| NUMBER OF | 1,122,895 | ||||||||||
| SHARES | 8 | SHARED VOTING POWER: | |||||||||
| BENEFICIALLY | |||||||||||
| OWNED BY | 0 | ||||||||||
| EACH | 9 | SOLE DISPOSITIVE POWER: | |||||||||
| REPORTING | |||||||||||
| PERSON | 1,122,895 | ||||||||||
| WITH | 10 | SHARED DISPOSITIVE POWER: | |||||||||
| 0 | |||||||||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: | ||||||||||
| 1,122,895 | |||||||||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): | ||||||||||
| o | |||||||||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): | ||||||||||
| 2.0% | |||||||||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
3
CUSIP NO. 12619C101
| 1 | NAMES OF REPORTING PERSONS: DEERWOOD PARTNERS, LLC |
||||||||||
| I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY): |
|||||||||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS): |
||||||||||
| (a) o | |||||||||||
| (b) o | |||||||||||
| 3 | SEC USE ONLY: | ||||||||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): | ||||||||||
| o | |||||||||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION: | ||||||||||
| CALIFORNIA | |||||||||||
| 7 | SOLE VOTING POWER: | ||||||||||
| NUMBER OF | 1,122,895 | ||||||||||
| SHARES | 8 | SHARED VOTING POWER: | |||||||||
| BENEFICIALLY | |||||||||||
| OWNED BY | 0 | ||||||||||
| EACH | 9 | SOLE DISPOSITIVE POWER: | |||||||||
| REPORTING | |||||||||||
| PERSON | 1,122,895 | ||||||||||
| WITH | 10 | SHARED DISPOSITIVE POWER: | |||||||||
| 0 | |||||||||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: | ||||||||||
| 1,122,895 | |||||||||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): | ||||||||||
| o | |||||||||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): | ||||||||||
| 2.0% | |||||||||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
4
CUSIP NO. 12619C101
| 1 | NAMES OF REPORTING PERSONS: GEORGE KALLINS, M.D. |
||||||||||
| I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY): |
|||||||||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS): |
||||||||||
| (a) o | |||||||||||
| (b) o | |||||||||||
| 3 | SEC USE ONLY: | ||||||||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): | ||||||||||
| o | |||||||||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION: | ||||||||||
| UNITED STATES | |||||||||||
| 7 | SOLE VOTING POWER: | ||||||||||
| NUMBER OF | 1,342,388 | ||||||||||
| SHARES | 8 | SHARED VOTING POWER: | |||||||||
| BENEFICIALLY | |||||||||||
| OWNED BY | 2,245,789 | ||||||||||
| EACH | 9 | SOLE DISPOSITIVE POWER: | |||||||||
| REPORTING | |||||||||||
| PERSON | 1,342,388 | ||||||||||
| WITH | 10 | SHARED DISPOSITIVE POWER: | |||||||||
| 2,245,789 | |||||||||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: | ||||||||||
| 3,588,177 | |||||||||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): | ||||||||||
| o | |||||||||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): | ||||||||||
| 6.0% | |||||||||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): | ||||||||||
| IN | |||||||||||
5
CUSIP NO. 12619C101
| 1 | NAMES OF REPORTING PERSONS: BETTINA KALLINS |
||||||||||
| I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY): |
|||||||||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS): |
||||||||||
| (a) o | |||||||||||
| (b) o | |||||||||||
| 3 | SEC USE ONLY: | ||||||||||
| 4 | SOURCE OF FUNDS (SEE INSTRUCTIONS): | ||||||||||
| OO | |||||||||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): | ||||||||||
| o | |||||||||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION: | ||||||||||
| UNITED STATES | |||||||||||
| 7 | SOLE VOTING POWER: | ||||||||||
| NUMBER OF | 0 | ||||||||||
| SHARES | 8 | SHARED VOTING POWER: | |||||||||
| BENEFICIALLY | |||||||||||
| OWNED BY | 2,245,789 | ||||||||||
| EACH | 9 | SOLE DISPOSITIVE POWER: | |||||||||
| REPORTING | |||||||||||
| PERSON | 0 | ||||||||||
| WITH | 10 | SHARED DISPOSITIVE POWER: | |||||||||
| 2,245,789 | |||||||||||
| 11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: | ||||||||||
| 2,245,789 | |||||||||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS): | ||||||||||
| o | |||||||||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): | ||||||||||
| 3.9% | |||||||||||
| 14 | TYPE OF REPORTING PERSON (SEE INSTRUCTIONS): | ||||||||||
| IN | |||||||||||
6
ITEM
1. SECURITY AND ISSUER.
This Schedule 13D relates to the common
stock, par value $.001 per share (the “Common Stock”), of CNS Response, Inc., a
Delaware corporation (the “Company”), which has its principal executive offices
at 85 Enterprise, Suite 410, Aliso Viejo, CA 92656.
ITEM
2. IDENTITY AND BACKGROUND.
This Schedule 13D is being filed
jointly by BGN Acquisition Ltd., LP, a California limited partnership (“BGN”),
Deerwood Holdings, LLC, a California limited liability
company (“Holdings”), Deerwood Partners, LLC, a California limited
liability company (“Partners”), George Kallins, MD and Bettina Kallins
(collectively, the “Reporting Persons”). BGN’s principal business is
real estate investment. The address of the principal office of BGN is
15747 Woodruff Ave., Bellflower, CA 90706. Holdings’ principal
business is real estate investment. The address of the principal
office of Holdings is 16 Deerwood Lane, Newport Beach, CA
92660. Partners’ principal business is real estate
investment. The address of the principal office of Partners is 16
Deerwood Lane, Newport Beach, CA 92660. Dr. Kallins is the general
partner of BGN and as such may be deemed to beneficially own the securities
owned by BGN. Dr. Kallins and Ms. Kallins are the managing
members of Holdings and Partners and as such may be deemed to
beneficially own the securities owned by Holdings and
Partners. Dr. Kallins has served as President and CEO of ACP
Management, his family’s property management, development and real estate
investment firm since 2004; however, he also continues to practice medicine in
his specialty field of Obstetrics and Gynecology. Ms. Kallins is a
financial consultant with Morgan Stanley
.. The principal business address of each of Mr.
and Ms. Kallins is 16 Deerwood Lane, Newport Beach, CA 92660. During
the last five years, none of the Reporting Persons has been
convicted in a criminal proceeding (excluding traffic
violations and similar misdemeanors) or been a 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 judg
ment, 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.
ITEM
3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On November 3, 2010, BGN, Holdings and
Partners executed a Securities Purchase Agreement with the
Company. In connection therewith, the Company issued convertible
notes (the “Notes”) in the aggregate principal amount of $762,250 and related
warrants (the “Warrants”) to purchase up to 928,916 shares of Common Stock, as
follows: (a) The Company received $250,000 in gross
proceeds from the issuance to BGN of Notes in the aggregate principal amount of
$250,000 and Warrants to purchase up to 416,666 shares. (b) The
Company also issued Notes in the aggregate principal amount of $512,250, and
Warrants to purchase up to 512,250 shares, to Holdings and Partners, in exchange
for the cancellation of the notes originally issued to Holdings and Partners on
July 5, 2010 and August 20, 2010 in the aggregate principal amount of $500,000
(and accrued and unpaid interest on those notes) and warrants to purchase an
aggregate of up to 150,000 shares originally issued to Holdings and Partners on
August 20, 2010.
SAIL Venture Partners, LP (“SAIL”)
issued four separate unconditional guaranties (collectively, the “Guaranties”)
to each of Holdings and Partners, guaranteeing the prompt and complete payment
when due of all principal, interest and other amounts under the Notes issued to
Holdings and Partners. The obligations under each Guaranty are
independent of the Company’s obligations under the Notes and separate actions
may be brought against the guarantor. In connection with the November
3 transactions, SAIL and Holdings and Partners entered into a purchase option
agreement pursuant to which SAIL has the option, which is exercisable at any
time through March 31, 2011, to purchase any or all of the Notes issued to
Holdings and Partners in exchange for the July 5, 2010 and August 20, 2010 notes
from time to time at a price equal to the aggregate principal amount plus all
accrued but unpaid interest.
The Notes mature on November 3, 2011
(subject to earlier conversion or prepayment), earn interest equal to 9% per
year with interest payable at maturity, and are convertible into shares of
common stock of the Company at a conversion price of $0.30. The
conversion price is subject to adjustment upon (1) the subdivision or
combination of, or stock dividends paid on, the common stock; (2) the issuance
of cash dividends and distributions on the common stock; (3) the distribution of
other capital stock, indebtedness or other non-cash assets; and (4) the
completion of a financing at a price below the conversion price then in
effect. The Notes can be declared due and payable upon an event of
default, defined in the Notes to occur, among other things, if the Company fails
to pay principal and interest when due, in the case of voluntary or involuntary
bankruptcy or if the Company fails to perform any covenant or agreement as
required by the Note.
7
The obligations of the Company under
the terms of the Notes are secured by a security interest in the tangible and
intangible assets of the Company, pursuant to a Security Agreement, dated as of
October 1, 2010, by and between the Company and John Pappajohn, as
administrative agent for the holders of the Notes. The agreement and
corresponding security interest terminate if and when holders of a majority of
the aggregate principal amount of Notes issued have converted their Notes into
shares of common stock.
The Warrants expire on November 2, 2017
and are exercisable for shares of common stock of the Company at an exercise
price of $0.30. Exercise price and number of shares issuable upon
exercise are subject to adjustment (1) upon the subdivision or combination of,
or stock dividends paid on, the common stock; (2) in case of any
reclassification, capital reorganization or change in capital stock and (3) upon
the completion of a financing at a price below the exercise price then in
effect.
The beneficial ownership of the
Company’s Common Stock reported in this Schedule 13D by:
|
·
|
BGN
is based on its ownership of 846,042 shares of Common Stock issuable upon
conversion of Notes (including interest thereon through January 3, 2011)
and 416,666 shares of Common Stock issuable upon exercise of Warrants,
with respect to which BGN has sole investment and voting
power;
|
|
·
|
Holdings
is based on its ownership of 866,770 shares of Common Stock issuable upon
conversion of Notes (including interest thereon through January 3, 2011)
and 256,125 shares of Common Stock issuable upon exercise of Warrants,
with respect to which Holdings has sole investment and voting
power;
|
|
·
|
Partners
is based on its ownership of 866,770 shares of Common Stock issuable upon
conversion of Notes (including interest thereon through January 3, 2011)
and 256,125 shares of Common Stock issuable upon exercise of Warrants,
with respect to which Partners has sole investment and voting
power;
|
|
·
|
Dr.
Kallins is based on his ownership of 38,000 shares of Common Stock,
2,579,581 shares of Common Stock issuable upon conversion of Notes held by
BGN, Holdings and Partners (including interest thereon through January 3,
2011), 928,916 shares of Common Stock issuable upon exercise of Warrants
held by BGN, Holdings and Partners, and 41,680 shares issuable upon
exercise of options; and
|
|
·
|
Ms.
Kallins is based on her ownership of 1,733,539 shares of Common Stock
issuable upon conversion of Notes held by Holdings and Partners (including
interest thereon through January 3, 2011) and 512,250 shares of Common
Stock issuable upon exercise of Warrants held by Holdings and
Partners.
|
Beneficial ownership amounts assume an
aggregate of 56,023,921 shares of Common Stock issued and outstanding as of
November 3, 2010, leading to the following beneficial ownership percentages for
the Reporting Persons: BGN: 2.2%, Holdings: 2.0%, Partners: 2.0%, Dr.
Kallins: 6.0% and Ms. Kallins: 3.9%. Each of Dr. Kallins and Ms. Kallins may be
deemed to beneficially own the securities owned by Holdings and Partners insofar
as they share the power to direct the voting or disposition of such
securities. Dr. Kallins may be deemed to beneficially own the
securities owned by BGN insofar as he has sole power to direct the voting or
disposition of such securities. Dr. Kallins also has sole voting
power with respect to the 38,000 shares of Common Stock and 41,680 shares
issuable upon exercise of options held by him. Neither the filing of
this Schedule 13D nor any of its contents shall be deemed to constitute an
admission that either Dr. Kallins or Ms. Kallins as an individual is, for any
purpose, the beneficial owner of any of the securities held by BGN, Holdings and
Partners, and each of Dr. Kallins and Ms. Kallins disclaims beneficial ownership
as to the securities held by BGN, Holdings and Partners.
Dr. Kallins currently serves as a
director of the Company.
ITEM
4. PURPOSE OF TRANSACTION.
All of the shares of Common Stock to
which this Schedule 13D relates, were acquired for and are held by each of the
Reporting Persons as an investment.
8
ITEM 5.
INTEREST IN SECURITIES OF THE ISSUER.
The discussion of the interest in
securities of the Company, as well as of transactions by the Reporting Persons
in the Company’s Common Stock effected in the past 60 days, is included in Item
3 hereof and is hereby incorporated by reference herein.
ITEM
6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT
TO
SECURITIES OF THE ISSUER.
Other than the arrangements discussed
in Item 3 hereof, the discussion of which is incorporated by reference herein,
there are no other contracts, arrangements, understandings or relationships
between the Reporting Persons and any other person, with respect to the
securities of the Company.
ITEM
7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit
No.
1 Joint
Filing Agreement.
9
CUSIP NO.
12619C101
SIGNATURES
After
reasonable inquiry and to the best of their knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: November 17,
2010
BGN
Acquisition Ltd., LP
a
California limited partnership
/s/ George Kallins, MD
By: George
Kallins, MD
Its:
General Partner
Dated: November 17,
2010
Deerwood
Holdings, LLC
a
California limited liability company
/s/ George Kallins, MD
By:
George Kallins, MD
Its:
Managing Member
Dated: November 17,
2010
Deerwood
Partners, LLC
a
California limited liability company
/s/ George Kallins, MD
By:
George Kallins, MD
Its:
Managing Member
Dated: November 17,
2010
/s/ George Kallins, MD
George
Kallins, MD
Dated: November 17,
2010
/s/ Bettina Kallins
Bettina
Kallins
10
EXHIBIT
1
JOINT
FILING AGREEMENT
The
undersigned acknowledge and agree that the
foregoing statement on Schedule 13D
is filed on behalf of each of
the undersigned and that all
subsequent
amendments to this statement on Schedule 13D shall be filed on behalf
of each
of the undersigned without the necessity of
filing additional joint acquisition statements. The undersigned acknowledge that each shall be
responsible
for the timely filing of such amendments, and for the
completeness and
accuracy of the information concerning him or
it contained therein, but shall not
be responsible for the completeness and
accuracy of the information concerning the other, except to
the extent that it knows or has reason to
believe
that such information is inaccurate.
Dated: November 17,
2010
BGN
Acquisition Ltd., LP
a
California limited partnership
/s/ George Kallins, MD
By: George
Kallins, MD
Its:
General Partner
Dated: November 17,
2010
Deerwood
Holdings, LLC
a
California limited liability company
/s/ George Kallins, MD
By:
George Kallins, MD
Its:
Managing Member
Dated: November 17,
2010
Deerwood
Partners, LLC
aCalifornia
limited liability company
/s/ George Kallins, MD
By:
George Kallins, MD
Its:
Managing Member
Dated: November 17,
2010
/s/ George Kallins, MD
George
Kallins, MD
Dated: November 17,
2010
/s/
Bettina Kallins
Bettina
Kallins